Palestinian economy set to contract 7.6% and requires ‘critical’ aid, World Bank says – The National

Palestinian economy set to contract 7.6% and requires ‘critical’ aid, World Bank says – The National

The Palestinian economy is set to contract by at least 7.6 per cent this year and requires aid to help it deal with the impact of the coronavirus pandemic that may double the government's fiscal deficit to $1.5 billion (Dh5.5bn), the World Bank said.. Output in the West Bank and Gaza may shrink by as much as 11 per cent if the recovery is slower than anticipated or if there are further restrictions, the Washington-based lender said in a new report released on Monday.. The coronavirus "continues to hit the [Palestinian] economy hard," the World Bank said.. A decline in revenues and substantial increase in public spending on people's medical, social and economic needs will strain the fiscal balance of the Palestinian Authority, the bank said.. "Even with reallocations of some expenditures, the financing gap could increase alarmingly, from an already high $800 million in 2019 to over $1.5bn in 2020 to adequately address these needs," the lender said.. More than a quarter of Palestinians lived below the poverty line before the pandemic and are now expected to increase to 30 per cent in the West Bank and 64 per cent in Gaza, according to the bank.. The