President of the Trade and Development Board Ambassador Federico Villegas,
Deputy Secretary-General, Ms. Isabelle Durant,
Distinguished delegates,
Ladies and gentlemen,

First and foremost, I wish to thank the Prime Minister of the State of Palestine, His Excellency Mr. Mohammad Shtayyeh, for his remarks. The Group of 77 and China would like to express its appreciation to UNCTAD for its work on assistance to the Palestinian People, and in particular for this informative report about the economic conditions in the occupied Palestinian territory (OPT), which highlights the severe consequences of the prolonged occupation on the Palestinian people, on their living conditions, on the environment, and on their opportunities for development.

The report also sheds light on the fiscal and economic implications of the prolonged occupation, linking the consequences of this loss of revenue to occupation to the additional spending and lower revenues caused by Covid-19 pandemic and the observed decline in donor support. The combination of these factors resulted in the inability of the Palestinian Government to meet its obligations to public sector employees, private sector contractors and poor households.

Mr. President,

The Group of 77 and China would like to express its deep concern about the finances of the Palestinian government which are on a freefall due to the leakage of Palestinian fiscal resources, amplified by the Israeli unilateral deductions from Palestinian fiscal revenues of 144 million dollars per year. This comes on top of the leakage of 18 per cent of Palestinian fiscal revenues to the occupying power as documented by UNCTAD.

As a result of the deductions, the Palestinian government paid partial salaries, public employees receive only half of their salaries, while accumulating arrears to the private sector and increasing its debt to commercial banks. Compounded with declining donor support, this fiscal shock will have severe socioeconomic consequences that will accelerate the ongoing deterioration in the OPT.

The Group of 77 and China thus concurs with UNCTAD’s report that stemming the leakage of Palestinian fiscal resources is a binding condition for fiscal sustainability and the achievement of Agenda 2030 in the OPT.

The Group 77 and China is concerned about the current economic and social trends in the OPT. The Group takes note of the fact that the economic performance in the OPT, before the onset of the COVID-19 pandemic, was already weak and the overall environment was unfavorable due to the occupation and the resulting restrictions and measures. The Group thus concurs with UNCTAD when it affirms that the occupation remains the main obstacle for socioeconomic development in the OPT.

Mr. President,

UNCTAD’s reports bring to the attention of the international community the demolition of Palestinian assets and structures in the West Bank. These demolitions displace hundreds of people every year and destroy communities and family life. Moreover, it is regrettable that settlements continue to expand. By the end of 2018, there were 150 settlements and 128 outposts. According to Security Council Resolutions 2334 (23 Dec. 2016) and 476 (30 June 1980), these settlements have no legal validity and constitute a flagrant violation of international law.

To expand settlements, Israel makes it impossible for Palestinians to obtain building permits for residential and other purposes. Palestinians are forced to build without permits at the risk of punitive demolition at their own expense. The Group of 77 and China takes note with concern that in 2019 Israel demolished or seized 622 Palestinian structures in the West Bank, including 127 intended for humanitarian assistance.

The Group of 77 and China notes the de facto annexation of parts of the West Bank and further concurs with UNCTAD in considering that this will constitute a severe obstacle to a two-State solution as called for by several United Nations resolutions.

Furthermore, the Group takes note of UNCTAD’s assessment that the Palestinian government lacks the policy space and is ill-equipped to cope with the extensive economic ramifications of the COVID-19 pandemic, and therefore joins the call for the international community to redouble its support for the Palestinian people in the aftermath of the pandemic. In 2008 donor support to the Palestinian budget amounted to 32 percent of GDP, but falling to 3.5 percent of GDP in 2019, while it is forecasted to fall even further in 2020. The international community has the responsibility to reverse the negative trend in donor support to the Palestinian people especially in the wake of the pandemic. In this connection, the Group commends UNCTAD for its continued technical support for the Palestinian people, government and other institutions through various initiatives, advisory services, expertise and overall technical assistance.

Once again, the Group of 77 and China would like to encourage development partners to extend additional resources to UNCTAD’s Programme on Assistance to the Palestinian People so that it can fulfil its mandates derived from paragraph 55(dd) of the Nairobi Maafikiano, as well as paragraph 9 of United Nations General Assembly resolutions 69/20, 70/12, 71/20, 72/13, 73/18 and 74/10, which request UNCTAD to assess and report to the General Assembly on the economic costs of the Israeli occupation for the Palestinian people.

To conclude, the Group of 77 and China reiterates its solidarity with the resilient Palestinian people and their best efforts for achieving just and lasting peace in the Middle East and the establishment of a two-State solution, in line with the relevant General Assembly resolutions.

I thank you, Mr. President.