15.3 Sectors in Palestine’s Bioeconomy
Agricultural Sector
Agriculture is a fundamental component of Palestine’s bioeconomy, with a focus on traditional and sustainable farming practices. Olive cultivation, date palms, and various other crops play a significant role in the Palestinian economy (Butterfield, D., 2000).
Palestine’s export economy is fueled by the production of agricultural goods, which also helps the population meet its nutritional needs. 90% of people are employed informally by the agricultural sector, while 13.4% of the population is formally employed in it, according to the Council for European Palestinian Relations. Palestine’s unemployment rate has risen over the last ten years, and the country’s agricultural sector is now the most impoverished. The World Bank claims that extensive use of land for nature reserves, along with military and settler use, negatively affects Palestinian agriculture. The disputes between Israel and Palestine are evident in Palestine’s agriculture, as land is at the core of the conflict.
The fisheries sector in Gaza has played a crucial role in ensuring food security and serves as a vibrant source of employment. Currently, there are 3,982 registered fishermen in the Gaza Strip, directly providing livelihoods for approximately 27,874 individuals. Considering the total population in the Gaza Strip is approximately 2.1 million people, nearly 7% of the population relies on the fisheries sector. Over the years, the number of registered fishermen has steadily increased, from 1,600 in 1995 to 2,305 in 2001, 2,750 in 2007, 3,606 in 2016, and reaching 3,982 in 2020. Unfortunately, a significant proportion of those engaged in the fisheries sector face economic hardships. According to the Department of Fisheries (DOF) in the Ministry of Agriculture, about 90% of fishermen live below the poverty line, currently subsisting on less than $200-250 per month. The per capita income derived from fishing has dwindled from $450-900 before 2007 to less than $200-300 in 2020. In the past, individuals with large vessels, such as trawlers (locally known as “Gar”) and purse seines (locally known as “Shanshula”), favored working in the fishing sector over other fields. However, this preference is no longer the case. It is alarming to note that the unemployment rate in Gaza now exceeds 50%, while the poverty rate has soared to 53%, despite a substantial number of people receiving aid from the government and international organizations. The worsening socioeconomic conditions have made life increasingly challenging in Gaza, with its local economy contracting by 7% in 2018, leading to a 10% decline in per capita income (UNCTAD 2019). The study area encompasses four fish landing sites, spanning from the north to the south, including Gaza City fishing port, the Deir Al-Balah landing site, the Khanyounis landing site, and the Rafah landing site (Hussein et al., 2022).
The Palestinian food and beverage sector has witnessed rapid growth and has become a dynamic part of the Palestinian economy. In 1998, the Investment Encouragement Law eased business restrictions, leading to increased investments in this sector. The Palestinian Territories provide a conducive business environment, making it an attractive location for starting or expanding food and beverage operations. Manufacturing facilities in this sector are equipped with modern, often semi or fully automated technology. Many of these plants hold ISO certifications, emphasizing their commitment to quality and international standards. In recent years, locally produced food and beverages have gained a substantial market share, reaching 65% to 70% in 2016. Government policies promoting local investment and consumption have contributed to this growth. Palestinian food and beverage products are marketed effectively in the West Bank and Gaza, with some reaching East Jerusalem and facing restrictions due to Israeli measures. A significant portion of products is exported to the Middle East and Europe, with about 85% of exports going to the Israeli market, totaling one billion US dollars in 2016.
Vision and development objectives of Palestine’s Bioeconomy
The World Bank’s latest report on Palestine’s bioeconomy development anticipates a moderation in economic growth for 2023. Despite a robust 4% growth rate in 2022, driven by the easing of COVID-19 restrictions and increased private consumption, persistent challenges remain. Ongoing tensions within Palestinian territories and the impact of the Russian invasion of Ukraine pose significant downside risks. The report emphasizes that sustained economic growth is crucial for improving living standards, fiscal sustainability, and reducing unemployment. External factors, such as food and energy price fluctuations, contribute to the challenging economic outlook. The report, set to be presented to the Ad Hoc Liaison Committee in Brussels, highlights fiscal reforms and improved fiscal balances in 2022, but also raises concerns about outstanding arrears and banking sector exposure to the public sector, necessitating ongoing vigilance.