Asma Marzouq – Palestine Economy Portal

Translated by Tamara Barakat

Governmental data published by the Palestinian Ministry of Finance recently revealed that the public debt increased in 2015 by 11%, reaching more than a billion shekels in comparison to 2014.

The public debt was 9 billion and 700 million shekels ($2 billion and 487 million) until the end of November 2015. At the end of 2014, it reached 8 billion and 646 million shekels ($2 billion and 217 million).

This great increase in public debt can be attributed to the increase in money borrowed by the Government from banks and local institutions in order to cover the current deficit in its budget and the pressing expenses required for the reconstruction of Gaza. Not to mention that only 7% of funds pledged for the reconstruction of Gaza have been received.

The loans borrowed by the Government from banks and local institutions in the first eleven months of 2015 increased by 18 times in comparison to the same period last year. The overall loans reached a billion and 179 thousand shekels ($302 million) in 2015 and 66 million shekels ($17 million) in 2014.

These loans are both long-term and short-term. In addition to borrowing from banks, the Government borrows from public bodies, such as the Petroleum Authority and the Pension Agency.

At the same time, the Palestinian Government was able to decrease its external debt to 130 million shekels (around $33 million).