PALESTINIAN TERRITORIES

In September 1993, Israel and the PLO issued in Oslo a Declaration of Principles that was expected to start a new process in the Middle East towards a lasting peace and an independent Palestinian state. On the basis of the declaration, the Palestinian Administration was established in 1994. The peace process has made slow progress after that. In September 2000, violence in the Palestinian territories and Israel erupted again taking its toll in both Palestinian and Israeli societies. A new turn took place with the death of Mr. Yasser Arafat in November 2004. A new government headed by Mr. Mahmoud Abbas took office in January 2005 with a renewed hope of ending the cycle of violence. The so-called Quartet co-operation between the USA, EU, Russia and the UN has been pivotal in resolving the conflict. The final outcome of this process remains yet to be seen.

The Palestinian economy remains severely depressed compared to its pre-intifada level. The World Bank estimates that Palestinian Gross Domestic Product is 23 percent lower than in 1999. Taking population growth into account, real GDP per capita is some 35 below its pre-intifada level. Despite economic stabilization in 2003, some 47 percent of Palestinian live below the official poverty line and the economic space of the West Bank and Gaza remains highly fragmented. The coping strategies for the poorest segment of the Palestinian population are being increasingly stretched thin. In addition, the protracted conflict is taking a heavy toll on the mental health of children and youth. Despite commendable efforts, the quality and coverage of basic social services are severely under stress. The PA’s legitimacy and ability to enforce law and order has gradually decayed. Reforms to improve public accountability, transparency and stability, all vital elements for economic recovery, require particular attention. Although PA is not de jure a fully-fledged state it has all the characteristics of a fragile state, which include weak territorial control, safety and security, weak capacity to deliver basic services, weak capability to manage public resources and weak ability to protect and support the ways in which the poorest people sustain themselves.

Development Co-operation

The Middle East peace process forms the basis for the development co-operation between Finland and the Palestinian Authority. Aid is directed towards improving the living conditions of the Palestinian people and reforming the Palestinian administration. Within the framework of bilateral co-operation, Finland has contributed approximately EUR 28 million to the Palestinian Territories. In addition, Finland has supported Palestinian refugees in the Middle East through the United Nations Relief and Works Agency (UNRWA) with a contribution of 47 million euros. Furthermore, as a member state of the European Union, Finland contributes to the European Commission’s development co-operation budget for the Palestinian Territories.

Projects Supported by the Government of Finland

• West Bank and Gaza Water and Sanitation Project – Technical advisors for the Palestinian Water Authority Programme administration Support 1999-2006 EUR 3,88 million
• Primary Education Development Programme – PALFEP I-III 1997-2009 EUR 13 million
• Production of Textbooks 1999-2002 EUR 2,02 million
• The Bethlehem 2000 project – Lutheran Church Cultural Centre 1998-2003 EUR 4,14 million
• World Bank Emergency Support Services Programme 2002-2004 EUR 3,81 million
• Land Administration Project in cooperation with the World Bank 2005-2007 EUR 1,60 million
• World Bank Reform Trust Fund 2005 EUR 1 million
• Fund for Local Cooperation 2003-2006 EUR 715,000
• Training in Digital Media (Bethlehem University) 2002-2004 EUR 230,000
• Support for TV News Production with Palestinian TV 2000-2004 EUR 555,000
• Democracy Study 1998-2004 EUR 420,000
• Support to the Geneve Initiative 2004 EUR 200,000
• School for the Blind in Gaza 1999-2004 EUR 123,000
• Support for the Palestinian Delegation Mission in Helsinki 2003-2004 EUR 130,000
  

Further information on Finnish development co-operation policies and programmes can be obtained from the Ministry for Foreign Affairs website at global.finland.fi