RAMALLAH, Aug. 20 (Xinhua) -- A report issued by the Palestine Monetary Authority on Sunday forecasts drop in economic growth rate by 0.7 percent in Palestine as compared with last year.
The report mentioned that the growth rate could possibly slow down to nearly 3.4 percent, compared with 4.1 percent in 2016.
This performance is based on the prediction that the current political and economic situation in Palestine will remain unchanged, in terms of Israeli imposed restrictions on crossings and access of people and goods, the continued growth of Palestinian labor force inside Israel and the process of reconstruction of Gaza Strip, according to the report.
The economic growth in 2016 registered an increase of 0.7 percent compared with 2015.
The report also said that Gaza witnessed in the past year the highest growth rate in five years, reaching 7.7 percent, compared with 6.1 in 2015, due to investments.
In the West Bank, however, the growth rate in 2016 reached 3 percent compared with 2.6 percent in 2015, despite "the continued unrest due to popular outrage against Israeli occupation," said the report.
High unemployment rates are still considered one of the main hurdles to economic growth, said the report, especially in Gaza Strip.
Despite the increased economic growth rate in Gaza last year, the unemployment rate in Palestine reached a new high at 26.9 percent of the overall labor force, compared with 25.9 percent in 2015.
According to the new report, the unemployment rates in 2016 reached 18.2 percent in the West Bank and 41.7 percent in Gaza.
Additionally, the report mentioned that the current Palestinian balance of payment showed a 1.35 million U.S. dollars deficit in 2016, with a better performance by 34.8 percent compared with 2015, making 10.1 percent of GDP.
Concerning the finance sector, the report showed an increase of assets in the financial body by 12.7 percent in 2016, compared with 6.6 percent in the end of 2015, standing at 14.196.4 million dollars.
Client deposits in Palestinian banks in 2016 registered an increased by 9.8 percent, besides an increase in ownership of the banking sector by 14.9 percent.
