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U.S. Department of State 
West Bank and Gaza Commercial Guide 
Office of the Coordinator for Business Affairs 
 
 
 
                                 COMMERCIAL GUIDE 
                              FOR WEST BANK AND GAZA 
                                     FY 1996 
 
 
    Prepared by the 
    American Embassy, Tel Aviv and 
    American Consulate General, Jerusalem 
    July 1995 
 
 
Note to the Reader: 
 
This Country Commercial Guide (CCG) presents a comprehensive look at 
Israel's commercial environment through economic, political and market 
analyses. 
 
The CCG's were established by recommendation of the Trade Promotion 
Coordinating Committee (TPCC), a multi-agency task force, to consolidate 
various reporting documents prepared for the U.S. business community.  
Country Commercial Guides are prepared annually at U.S. Embassies 
through the combined efforts of several U.S. government agencies. 
 
 
    TABLE OF CONTENTS 
 
I.     EXECUTIVE SUMMARY 
 
II.    ECONOMIC TRENDS AND OUTLOOK 
 
    Major Trends and Outlook 
    Principal Growth Sectors 
    Government Role in the Economy 
    Balance of Payments Situation 
    Infrastructure Situation 
 
III.  POLITICAL ENVIRONMENT 
 
    Nature of Political Relationship with the United States 
    Major Political Issues Affecting Business Climate 
    Brief Synopsis of Political System, Schedule for Elections, 
       and Orientation of Major Political Parties 
 
IV.    MARKETING U.S. PRODUCTS AND SERVICES 
 
    Distribution and Sales Channels 
    Use of Agents and Distributors; Finding a Partner 
    Franchising 
    Direct Marketing 
    Joint Ventures/Licensing 
    Steps to Establishing an Office 
    Selling Factors/Techniques 
    Advertising and Trade Promotion 
    Pricing Product 
    Sales Service/Customer Support 
    Selling to the Government 
    Protecting Your Product from IPR Infringement 
    Need for a Local Attorney 
 
V.     LEADING SECTORS FOR U.S. EXPORTS AND INVESTMENT 
 
    Best Prospects for Non-Agricultural Goods and Services 
    Best Prospects for Agricultural Goods and Services 
    Significant Investment Opportunities 
 
VI.    TRADE REGULATIONS AND STANDARDS 
 
    Trade Barriers, including Tarrifs, Non-Tariff Barriers, 
       and Import Taxes 
    Customs Valuation 
    Import Licenses 
    Export Controls 
    Import/Export Documentation 
    Temporary Entry 
    Labeling, Marking Requirements 
    Prohibited Imports 
    Standards 
    Free Trade Zones/Warehouses 
    Special Import Provisions 
    Membership in Free Trade Arrangements 
 
VII.   INVESTMENT CLIMATE 
 
    Openness to Foreign Investment 
    Conversion and Transfer Policies 
    Expropriation and Compensation 
    Dispute Settlement 
    Political Violence 
    Performance Requirements/Incentives 
    Right to Private Ownership and Establishment 
    Protection of Property Rights 
    Regulatory System: Laws and Procedures 
    Bilateral Investment Agreements 
    OPIC and Other Investment Insurance Programs 
    Labor 
    Foreign Trade Zones/Free Ports 
    Capital Outflow Policy 
    Major Foreign Investors 
 
VIII.  TRADE AND PROJECT FINANCING 
 
    Brief Description of Banking System 
    Foreign Exchange Controls Affecting Trading 
    General Financing Availability 
    How to Finance Exports/Methods of Payment 
    Types of Available Export Financing and Insurance 
    Project Financing Available 
    List of Banks with Correspondent Banking Arrangements 
 
IX.    BUSINESS TRAVEL 
 
    Business Customs 
    Travel Advisories and Visas 
    Holidays 
    Business Infrastructure 
 
X.    APPENDICES 
 
    Appendix A.    Country Data 
    Appendix B.    Domestic Economy 
    Appendix C.    Trade 
    Appendix D.    Investment Statistics 
    Appendix E.    U.S., West Bank and Gaza Contacts 
    Appendix F.    Market Research 
    Appendix G.    Trade Event Schedule 
 
 
I. EXECUTIVE SUMMARY 
 
Political reconciliation between Israel and the Palestinians beginning 
with the signing of the Declaration of Principles in September, 1993 has 
paved the way for expanded business opportunities for U.S. companies in 
the West Bank and Gaza.  With the signing of the Gaza-Jericho Agreement 
in May, 1994, and ongoing negotiations to reach an interim agreement 
between Israel and the Palestinian Authority (PA), the PA is gradually 
assuming more control over many economic functions. The PA is making 
slow but steady progress in developing transparent legal, regulatory and 
commercial codes. 
 
The best manufacturing export opportunities for U.S. companies exist in 
the sale of power, telecommunications, construction and refurbished 
factory and transportation equipment to support infrastructure and 
commercial development over the next five years. The international donor 
community has pledged $2.4 billion over the five year period between 
1994 and 1999.  A number of large infrastructure projects are still in 
the planning stages and may offer opportunities for U.S. firms. The 
Palestinian Authority plans major projects for power generation, 
telecommunications, water and sewage systems, a port and airport in 
Gaza. Although tenders currently exist only for the Gaza airport, other 
major tenders will be announced in 1995-96. 
 
The population of the West Bank and Gaza is approximately 2.3 million.  
Despite relatively low reported annual incomes, there is a growing 
middle/upper-middle class in the West Bank and Gaza, due in large part 
to the recent influx of diaspora Palestinian investors and technocrats 
who staff PA ministries. This class seeks high quality consumer goods. 
American-made food and consumer items are popular, as is electronic 
equipment such as personal computers. Opportunities for U.S. companies 
also exist in developing franchising, distributorship and sales 
relationships with West Bank and Gaza companies. Potential exists for 
fast food, hardware, and office supply franchising. Palestinians are 
westernized and well-educated and seek American goods, know-how and 
services.  As Palestinian incomes grow, fast food franchising may offer 
new opportunities for U.S. companies. 
 
The Palestinian Authority, Israel and the donor community are discussing 
the establishment of two or more industrial parks, possibly focused on 
export processing, one in Gaza and one in the northern West Bank. 
Although these are in the planning stages, they may offer investment 
incentives for U.S. companies interested in greater accessibility to 
regional, Gulf and European markets, and related exports of U.S. 
products. 
 
Given joint Palestinian/Israeli jurisdiction over some areas of the West 
Bank, and related differing investment, trade and customs regulations, 
U.S. companies who wish to trade with or invest in the West Bank and 
Gaza should contact the U.S. Commercial Service in Tel Aviv and 
Jerusalem to discuss specific arrangements.  American businesses seeking 
to establish investment and joint venture arrangements should work with 
a local partner and the U.S. Commercial Service throughout the approval 
process. 
 
Country Commercial Guides are available on the National Trade Data Bank 
on CD-Rom or through the Internet. Please contact Stat-USA at 1-800-
STAT-USA for more information.  To locate Country Commercial Guides 
through the Internet, please use the following world-wide web address: 
www.stat-usa.gov. CCGs can also be ordered in hard copy or on diskette 
from the National Technical Information Service (NTIS) at 1-800-553-
NTIS. 
 
 
II.  ECONOMIC TRENDS AND OUTLOOK 
 
Please Note: This is a guide on export and investment opportunities in 
the West Bank and Gaza.  U.S. businesses should know that the Israelis 
and Palestinians share jurisdictional and regulatory control over some 
aspects of the West Bank and Gaza economies, such as trade.  Through an 
Interim Status currently being negotiated, the Palestinians will assume 
greater control over many economic and trade functions.  U.S. 
businessmen should contact personnel at the U.S. Embassy in Tel Aviv or 
Consulate General in Jerusalem listed in Appendix E for current 
information regarding economic and trade regulations and procedures. 
 
Major Trends and Outlook 
 
The Palestinians and Israel signed an economic accord as part of the 
Gaza-Jericho Agreement in May, 1994.  As part of this and follow-on 
agreements, the Palestinian Authority (PA) assumed responsibility for 
most key spheres in the Gaza and Jericho economies, including trade and 
investment.  The picture in the West Bank outside Jericho is more 
complex: the PA has assumed authority over key spheres such as taxation, 
health and education.  There is no Palestinian currency, which means 
that inflation in the West Bank and Gaza is tied to that in Israel. 
Negotiations with Israel are ongoing regarding complete transfer of 
authority for the rest of the West Bank.  It is too soon to evaluate the 
influence of the Palestinian Authority over economic conditions in the 
West Bank and Gaza as the economy remains heavily tied to Israel and 
bound by Israeli customs and other regulations. 
 
The West Bank and Gaza market, with a total population of 2.3 million, 
is approximately 5 percent the size of the Israeli economy.  Annual 
population growth is 4.1% in the West Bank, 5.1% in Gaza.  Although 
relatively small, the West Bank/Gaza economy offers potential for U.S. 
exports, investment and regional production.  The Israeli and West 
Bank/Gaza economies remain linked, in part due to the fact that Israel 
purchases almost 85% of West Bank/Gaza exports, and the PA uses the 
Israeli shekel as legal tender and does not have its own currency (the 
Jordanian Dinar is also legal tender in the West Bank but the shekel is 
more widely used.  However, the gradual assumption oby the Palestinians 
of greater control over their economy may involve a gradual de-linking 
of the Israeli and West Bank/Gaza economies, particularly in terms of 
trade sources.  This and the links between local Palestinians and 
diaspora Palestinians in the region and the U.S. may offer important 
export opportunities for U.S. suppliers. 
 
Official statistics suggest that GNP growth has slowed in recent years, 
from 8.5 percent in the West Bank and 6.3 percent in Gaza in the 1970's 
to 3.5 percent in the West Bank and 1.6 percent in Gaza in the 1980's 
and lower in 1995.  This is at least in part due to dislocations of the 
intifada after 1987, and the loss of Gulf remittances (formerly one-
third of West Bank/Gaza GNP) following the Gulf War when Palestinians 
left the Gulf states.  Unemployment in Gaza is estimated by some at 50 
percent, and in the West Bank, about 30 percent. (These figures may not 
reflect actual unreported part-time employment.) 
 
Annual per capita income in the West Bank dropped from $2200 in 1990 to 
$1200 in 1995; in Gaza, per capita income dropped from $1400 in 1990 to 
$600 in 1995. (These figures do not reflect unreported income and the 
"grey" market, which many believe is substantial in the West Bank and 
Gaza and has grown in recent years.)  The substantial decline in 
reported household income between the late 1980's and early 1990's was 
caused by three main factors: the Palestinian uprising (Intifada) 
beginning in 1987 which forced business closings due to politically-
mandated strikes; the expulsion of Palestinian workers who transferred 
money to the West Bank/Gaza from the Gulf states after the Gulf War; and 
Israeli closure of its checkpoint crossings in the West Bank and Gaza in 
response to terrorism, temporarily beginning in 1993 and more 
permanently beginning in late 1994. 
 
Despite official statistics showing a recent economic slowdown in the 
West Bank and Gaza, there has been a substantial increase in imports of 
consumer goods, particularly small electronic appliances, clothing and 
shoes.  This may be due to a growing "grey" market with unreported 
production and income, and to increasing ties between Palestinians 
living in the West Bank and Gaza and those living in the U.S.  Moreover, 
since the beginning of reconciliation between Israel and the 
Palestinians in September, 1993, diaspora Palestinians have begun to 
transfer funds to the area for investment and residential/commercial 
construction. 
 
Investment in housing has remained strong since the 1980's, with 20 
percent of GDP going into this sector, compared to 7 percent in similar 
societies.  There has been a boom in housing construction in Gaza and 
Ramallah in the West Bank since the signing of the Declaration of 
Principles in September, 1993.  Most housing construction is privately 
financed and benefits the middle and upper classes, as well as many 
diaspora Palestinians. Availability of affordable housing remains a 
serious problem for the lower-middle and lower classes, particularly in 
Gaza.  Land prices, especially in urban areas, have skyrocketed since 
September, 1993, in large part in the West Bank at least, because only 5 
percent of the land is open for development.  In Gaza --rougly twice the 
size of the District of Columbia-- land prices remain high because of 
the scarcity of land.  Due to the virtual integration of the Palestinian 
labor market into the Israeli economy until the latest Israeli closure 
in 1994-1995, labor costs in the West Bank and Gaza, while low compared 
to Israel, are relatively high for the region. 
 
Principal Growth Sectors 
 
The continued expansion of peace between Israel and the Palestinians, 
and the gradual assumption by the Palestinians of greater control over 
their economy should lead to continued international donor efforts to 
support the needs of the new Palestinian Authority.  Infrastructure 
development, both publicly and privately financed, will be a major 
growth sector in the West Bank and Gaza over the next five years.  
Although planning is still underway, major projects are scheduled for 
building a port and airport in Gaza, and for electric power generation 
and expansion of telecommunications infrastructure, equipment and 
services. The first phase of the Gaza port will cost $60 million, with 
the Dutch Government providing $24 million in support. Public and 
private investment is needed for upgrading and expanding sanitation, 
waste disposal and water services, as well as for upgrading West Bank 
and Gaza roads.  Private and public contractors seek suppliers of 
competetively-priced equipment, machinery and raw materials for major 
infrastructure projects. 
 
Private housing construction should also show strong growth; there will 
be continuing high demand for low and lower-middle income families.  
While local builders and engineers can meet much of this demand at 
comparatively low prices, innovation in low-cost, multi-family housing 
construction is needed from outside sources.  There is a growing trend, 
particularly in Gaza, in building large commercial and residential 
towers rather than one or two story buildings.  Companies who can 
produce low-cost construction inputs in high volume should consider 
marketing and distribution options in the West Bank and Gaza. 
 
Recent investment in productive assets is extremely low, 1-4 percent of 
GDP.  In 1990, manufacturing made up only 7.4 percent of per capita GDP, 
compared to 13 percent in Jordan. Manufacturing employment accounts for 
15.5 percent of total employment in the West Bank/Gaza.  Capacity 
utilization averages 56 percent. West Bank/Gaza companies are small by 
world standards, and 90 percent of all firms employ fewer than eight 
people.  The manufacturing sector should show strong growth as 
Palestinians assume greater control over their political and economic 
lives.  Widening regional cooperation should open export markets for 
Palestinian goods. 
 
Expansion is expected in light industry and low-tech electrical 
assembly, such as car dashboard and electronic goods assembly, and in 
the manufacture and export of processed foods, pharmaceuticals, textiles 
and shoes, hardware, wood and cane furniture, plastics and housewares.  
Construction inputs such as cement and steel products, also will be in 
heavy demand.  The relatively high education level of the workforce in 
comparison to that in Jordan and Egypt should give the West Bank and 
Gaza a competitive advantage in industries requiring technical 
expertise. 
 
The agricultural sector employs over 34 percent of the West Bank and 
Gaza workforce, and accounts for 30 percent of West Bank and 25 percent 
percent of Gaza GDP.  The sector has excellent growth potential, 
particularly to provide inputs for the local food processing industry. 
Local entrepreneurial talent, climate, and a sound technological base 
are strategic advantages in the sector.  However, the ultimate growth 
potential of the sector depends in part upon the willingness of Israel 
and neighboring countries to lower agricultural trade barriers or to at 
least allow the transit of Palestinian agricultural goods to Europe and 
the Gulf. 
 
Non-government services account for 40 percent of West Bank/Gaza GDP.  
Tourism in Israel is expected to grow 250 percent to 5 million visitors 
annually by the year 2,000.  Tourism in the West Bank and Gaza is also 
expected to grow.  Tourism expansion in the West Bank and Gaza depends 
heavily on security issues and, in the West Bank whether the PA can 
obtain land and building permits from the Israelis.  Franchising and 
distributorships are becoming increasingly popular, with the best 
prospects in hardware, computers, electronics and office equipment, fast 
food, amusement and "theme" parks, and small business services such as 
copying and printing. 
 
While a number of Arab banks have already set up offices in the West 
Bank and Gaza, the financial services market remains relatively 
undeveloped.  Correspondence and other international banking 
relationships are developing.  Some observers believe that areas under 
PA control for banking services will show strong growth in offshore 
banking facilities, due to the fact that the PA allows holding foreign 
currency accounts such accounts. 
 
Government Role in the Economy 
 
The Palestinian Authority has pledged to promote the private sector, and 
to allow private management of major infrastructure systems, such as 
power and telecommunications.  The private sector accounts for over 90 
percent of West Bank/Gaza GDP. Unlike other developing regions, the West 
Bank and Gaza do not have a history of government ownership of large 
sectors of the economy. 
 
Currently, the PA, including Chairman Arafat and various ministers, 
plays a major role in the approval process for private commercial 
projects. Responsibility for major projects is often shared by several 
ministries, and U.S. businesses must be sure to talk to all relevant 
ministries when competing for contracts. A new investment law for Gaza 
and Jericho requires that all new investments must be approved by an 
investment board to be eligible for incentives such as tax holidays. 
(See Section VII below regarding Investment Law specifics.) 
 
Balance of Payments Situation 
 
The West Bank and Gaza have a large trade imbalance, approximately 28 
percent of GNP.  Merchandise exports from the West Bank and Gaza 
declined from a peak of $403 million in 1981 to $208 million in 1991.  
The trade deficit was estimated at $249 million or higher in 1992.  
Since 1973, approximately 85 to 90 percent of all West Bank and Gaza 
imports, particularly agricultural commodities, have come from Israel; 9 
percent come from Jordan and 1 percent from other countries.  During the 
same period, approximately 70 percent of West Bank and Gaza exports went 
to Israel, 28 percent to Jordan, and 2 percent to other countries.  The 
West Bank and Gaza economies are highly export-oriented: exports to 
Israel were 80 percent of Gaza's GNP in 1992. 
 
Infrastructure Situation 
 
Infrastructure--particularly water and power systems, and sanitation, 
road and telephone networks--needs substantial upgrading and expansion. 
Annual use of West Bank and Gaza water resources remains at 1973 levels, 
and must be expanded to sustain private sector development. Electricity 
consumption is low compared to per capita income: KWH per capita is 680 
in the West Bank and Gaza, compared to 1054 in Jordan and 815 in Egypt. 
The ratio of telephone subscribers to population is 1:46 in the West 
Bank/Gaza, compared to 1:15 in Jordan and 1:36 in Egypt. Lack of 
adequate physical infrastructure for electric power and an insufficient 
power supply cause work stoppages in most West Bank and Gaza firms. 
 
 
III.POLITICAL ENVIRONMENT 
 
Nature of Political Relationship with the United States 
 
The United States maintains good working relations with the Palestinian 
Authority.  The issue of Arab-Israeli peace has been a major focus in 
U.S.-Palestinian Authority relations.  On September 13, 1993, PLO 
Chairman Arafat and Israeli Prime Minister Rabin signed the Declaration 
of Principles (DOP), which outlined a five-year timetable for peace 
between Israel and the Palestinians.  On May 4, 1994, Arafat and Rabin 
signed an agreement implementing the first stage of the DOP--self-rule 
for Gaza and Jericho. 
 
The U.S. government has pledged to do everyting it can to ensure 
successful implementation of the DOP.  The U.S. committed to an 8 year, 
$500 million assistance program as part of the international donor 
effort.  In addition, the U.S. has extended GSP to the West Bank and 
Gaza and is considering a Free Trade Agreement with the PA. 
 
Israel and the Palestinians are negotiating an Interim Agreement as 
called for in the Declaration of Principles.  Included in the agreement 
are arrangements for redeployment of Israeli forces in the West Bank, 
transfer of all civil authorities to the Palestinian Authority, and 
elections for a Palestinian Council to represent Gaza and the West Bank.  
The U.S. government remains engaged in a facilitating role as these 
negotiations proceed.  The U.S. government also take the lead in 
ensuring international donor support for the agreement. 
 
Major Political Issues Affecting the Business Climate 
 
Three major political issues affect the business climate in the West 
Bank and Gaza.  These are: 1) the rate of progress in reaching and 
implementing Israeli-Palestinian agreements; 2) Israeli security 
measures to prevent acts of terrorism; and 3) the potential for clashes 
between Palestinian demonstrators and Israeli security forces.  These 
issues have a major effect on the willingness of businesses to invest in 
the West Bank and Gaza.  Of particular concern are the free flow of 
goods and workers both within the West Bank and Gaza and between these 
areas and Israel. 
 
Personal status laws (marriage, divorce, inheritance) are derived from 
religious law.  Other sectors are governed by a combination of Ottoman, 
British Mandate, Egyptian, pre-1967 Jordanian, and new Palestinian law, 
and Israeli military orders. 
 
Brief Synopsis of Political System, Schedule for Elections, 
and Orientation of major Political Parties 
 
Established by the Gaza/Jericho Agreement, the Palestinian Authority is 
an assembly of ministers appointed by Yasser Arafat, who serves as head 
or chairman of the Authority.  Under the terms of the Interim Agreement 
being negotiated, a Palestinian Council with legislative powers will be 
elected to serve as an interim self-governing authority.  A council 
president will be elected separately to serve as the executive head of 
this authority. 
 
Municipal councils, both in the West Bank and Gaza, were last elected in 
1976.  New elections may be held during the interim period.  Civil 
institution-building remains at a nascent stage, but democratic ideals 
have strong support among Palestinians.  The Palestinian Authority is 
drafting a law governing the formation of parties and political 
participation. Palestinian political parties are being formed in 
anticipation of elections for the Palestinian Council. 
 
A range of political perspectives are emerging in Palestinian society, 
including secular moderates, leftists and Islamicists. Political support 
for moderate parties including Chairman Arafat appears to be gaining.  
However, fundamentalist and rejectionist parties such as the Palestinian 
Islamic Jihad and Hammas, continue to oppose the peace process. 
 
 
IV. MARKETING U.S. PRODUCTS AND SERVICES 
 
Distribution and Sales Channels 
 
The West Bank/Gaza population is heavily concentrated in or near urban 
centers: Gaza City and Khan Yunis in Gaza, and four major towns in the 
West Bank: Nablus and Ramallah in the north and Bethlehem and Hebron in 
the south.  Since the area has no indigenous ports or airport, goods 
must either transit Israeli, Jordanian or Egyptian ports.  Recently, the 
Palestinian Authority, Israel and Egypt concluded an agreement to allow 
limited quantities of goods through the Rafah crossing point on the 
Gaza-Egypt border.  The Palestinian Authority also has concluded an 
agreement with Jordan for transit of goods across the Allenby Bridge. 
 
Delays for products entering or exiting the West Bank and Gaza are 
common, due in large part to Israeli security checks.  Most products 
entering or exiting Gaza transit Erez or Nahal Oz checkpoints, where 
delays are common due to the volume of goods and the rigor of the 
security checks.  Both Israelis and Palestinians recognize the need to 
move goods faster and in greater quantities, while addressing Israeli 
security concerns.  A variety of options are under consideration. 
 
Most goods are sold in small retail outlets in West Bank and Gaza towns.  
Local consumers are price conscious, although quality of American brands 
is more important than price for the more westernized upper-middle 
class.  Moreover, even with shipping costs, American-made consumer 
products may be cheaper than relatively high-priced comparable Israeli 
items which are currently sold in Palestinian stores.  Wholesale 
channels and generic sales are not well-developed.  These channels 
should expand over the next five years due to their success in 
neighboring Israel and to their ability to offer quality at discounted 
prices. 
 
U.S. companies are strongly advised to work with local clearing agents 
to expedite goods through the customs clearing process. Currently, only 
Israeli firms are licensed as customs clearing agents.  This is likely 
to change as Palestinians assume more complete control over customs 
procedures. 
 
Use of Agents and Distributors; Finding a Partner 
 
Given the complexity of current local economic and trade circumstances, 
U.S. exporters who wish to market their goods in the West Bank and Gaza 
should use agents and distributors to obtain maximum sales exposure to 
the local market.  Although Israeli companies have in the past had the 
rights for agencies and distributorships in the West Bank and Gaza, this 
practice is changing with the gradual transfer of authority to the 
Palestinian Authority.  Due to cultural, language and other differences 
between Israelis and Palestinians, U.S. businesses may want to consider 
separating distributorships for the West Bank/Gaza and Israel, for 
maximum effectiveness and coverage.  The United States Government 
supports the expansion of the Palestinian economy through distribution 
and agency agreements between Palestinians and U.S. companies through 
arrangements most practicable to the business parties concerned. 
 
Currently, small distributorships in the West Bank and Gaza exist for 
some American food products, cigarettes, household products, and 
computers.  Local distributors usually import goods on their own 
account, carry limited stocks sufficient to satisfy immediate needs, and 
maintain their own sales organization. 
 
In concluding a representation agreement, U.S. companies should include 
the following elements: 
 
    --contract duration; 
    --exclusivity (if applicable); 
    --compensatory amount as a function of contract duration, in case 
      of termination of exclusivity; 
    --promotional input by agent and volume of sales; and 
    --dispute settlement mechanism, if possible. 
 
The U.S. Commercial Service (USCS) and the U.S. Foreign Agricultural 
Service (FAS) at the U.S. Embassy in Tel Aviv and the U.S. Consulate 
General in Jerusalem provide agent/distributor search services for Gaza 
and the West Bank, respectively, to assist U.S. companies to establish 
themselves in the local market.  For information on these services, 
interested firms should contact the USG personnel listed at the end of 
this report. 
 
Franchising 
 
Although there are no current franchise arrangements between U.S. and 
local Palestinian firms, potential exists for franchises in fast food 
restaurants, automotive supplies and service, hardware, and office 
supplies, among others.  As with distributorships, the U.S. Government 
supports the expansion of the Palestinian economy in the West Bank and 
Gaza through franchise arrangements between Palestinian and U.S. 
companies through arrangements most practicable to the business parties 
concerned. 
 
The key to successful franchising in the West Bank and Gaza will be cost 
competitiveness in relation to comparable items, brand recognition, 
strong management and marketing, and initial and ongoing training 
programs.  Due to the relatively small local population, the best 
franchising potential exists in sectors where specific dietary, language 
or usage patterns differ from those in neighboring countries.  For 
example, food and computer items and office supplies may be best 
marketed in the West Bank and Gaza with Arabic markings, rather than 
Hebrew markings required inside Israel. 
 
U.S. companies interested in developing local franchising arrangements 
should contact the U.S. Commercial Service at the U.S. Embassy in Tel 
Aviv for Gaza, and the U.S. Consulate General in Jerusalem for the West 
Bank.  (Also see Section V "Leading Sectors" section in this report.) 
 
Direct Marketing 
 
There is no direct marketing in the West Bank and Gaza. 
 
Joint Ventures/Licensing 
 
A number of joint venture arrangements are being discussed by U.S. and 
Palestinian businessmen.  Local businessmen are eager to develop joint 
venture arrangements, and larger local companies, particularly those 
with exporting experience, will be reliable partners for U.S. companies.  
The new Palestinian Authority Investment Law applies to both foreign and 
local businesses who wish to invest in areas under PA control.  
Currently, this includes Gaza/Jericho, but the rest of the West Bank may 
be included under a new Interim Agreement. 
 
Steps to Establishing an Office 
 
The differences in jurisdictional authority between the PA for Gaza and 
Jericho, and Israel for some functions in the rest of the West Bank, 
U.S. businesses should work with local partners, and with the U.S. 
Embassy in Tel Aviv and U.S. Consulate General in Jerusalem.  In 
general, new commercial enterprises require municipal registration, as 
well as approval by the Palestinian Authority for Gaza/Jericho and the 
Israeli Civil Administration for the rest of the West Bank.  All new 
commercial enterprises in Gaza and Jericho must register with the 
Palestinian Authority Ministry of Justice, the Ministry of Economy and 
Trade, and the Customs Authority, and open income tax and value-added 
tax (VAT) accounts. 
 
Selling Factors/Techniques 
 
U.S. businesses should note the influence of a comparatively large 
Palestinian community in the U.S. which has transferred to the West Bank 
and Gaza American consumer preferences and buying habits.  These 
cultural and consumption links are important factors in local 
Palestinian knowledge of U.S.-made products.  Although price is critical 
for successful sales in the West Bank and Gaza, American quality, 
particularly for computers and electronic equipment and consumer items, 
is increasingly sought by local purchasers. 
 
Advertising and Trade Promotion 
 
U.S. products face stiff competition from European, Israeli and locally-
made goods.  Competitively priced U.S. brand names are popular with 
Palestinian consumers, particularly the middle and upper-middle classes.  
Most advertising is done through local Arabic newspapers, although an 
expansion of advertising through newly established Palestinian 
television and radio services is possible.  A few companies have begun 
billboard advertising, which should expand over the next few years.  
Advertising in the West Bank and Gaza is comparatively cheap by world 
standards: a prime-time Palestinian Broadcasting radio announcement 
costs about $35 per minute. 
 
The U.S. Government, through the programs of the U.S. Commercial Service 
and Foreign Agricultural Service, organizes several trade events and 
catalog shows each year. 
 
Major Newspapers and Business Journals: 
 
    Al Quds (Arabic daily) 
    An Nahar (Arabic daily) 
    The Jerusalem Times (English weekly) 
 
Pricing Product 
 
Price is a major factor affecting purchasing decisions by Palestinian 
companies and consumers.  U.S. companies may want to gain market share 
by introducing products into the Palestinian market at locally 
competitive prices. 
 
Sales Service/Customer Support 
 
After-sales-service and customer support are important in the 
Palestinian market, and therefore are strong selling points for U.S. 
goods.  However, competitive pricing will remain most critical to 
building a customer base. 
 
Selling to the Government 
 
The Palestinian Authority is beginning to develop a formal tendering and 
bid process for government contracts.  Current tender amounts are 
relatively low by U.S. standards, but should be larger as bigger 
projects are announced.  The U.S. Government is assisting the 
Palestinian Energy Authority (PEA) and the Palestine Economic Council 
for Development and Reconstruction (PECDAR) to develop transparent 
contracting processes.  U.S. companies concerned about transparent 
bidding procedures for PA contracts should contact one of the Commercial 
Service officers listed at the back of this section at the U.S. Embassy 
in Tel Aviv or the U.S. Consulate General in Jerusalem. 
 
Protecting Your Product from IPR Infringement 
 
The Palestinian Authority currently has no intellectual property 
protection legislation. 
 
Need for a Local Attorney 
 
U.S. businesses planning to establish a business or joint venture in the 
West Bank or Gaza should seek local legal and accounting services. 
 
 
V. LEADING SECTORS FOR U.S. EXPORTS AND INVESTMENTS 
 
Please note that existing data on leading sectors is spotty and 
inconclusive.  Therefore, data tables are not included in this section. 
 
Best Prospects for Non-Agricultural Goods and Services 
 
1 - Power Generation Equipment (ELP) 
 
The Palestinian Authority is issuing a tender for a $110 to $200 million 
160 MW power project in Gaza.  U.S. companies have an excellent chance 
of being selected to provide equipment and services. Current peak demand 
of 100 MW for the Gaza strip is expected to increase to 160 MW over the 
next five years, depending on levels of industrialization.  The power 
station will be a land-based dual fuel system combining gas and steam 
turbine thermal power. Electricity generation will be 50 Hz, with 
distribution voltage at 22 KV.  A step-up sub-station will be used to 
increase the generation voltage to the transmission voltage of 132 KV. 
 
2 - Airport Ground/Support Equipment (APG) 
 
The Palestinian Authority recently signed an agreement with the 
Palestinian-Egyptian Arab Contractors' Company (PEACC) to construct an 
airport in Gaza.  PEACC has received a $17 million loan from Egyptian 
Al-Ahli Bank and a grant of $4.5 million for airport equipment.  The 
airport will consist of a 2.4 km. runway and 2.4 km taxiway suitable for 
Boeing 737's and smaller aircraft, and a terminal area covering 
approximately 2 square kilometers.  For more details, contact the PA 
airport officials listed at the end of this report. 
 
3 - Telecommunications Equipment (TEL) 
 
The Palestinian Authority has authorized a tripartite private consortium 
to manage telecommunications.  The consortium consists of the Aggad 
Group of Saudi Arabia, the Palestine Development and Industry Company 
(PADICO), and the Arab Bank.  The consortium is developing a tender and 
bid process for a $600 million project consisting of upgrading existing 
equipment, upgrading and expanding existing infrastructure and providing 
new telecommunications equipment, instruments and service.  Interested 
American companies should contact key officials in the Palestinian 
Ministries of Planning and Telecommunications, listed at the end of this 
report.  U.S. companies should also talk with the individuals at the PA 
Planning Ministry listed at the back of this report. 
 
4 - General Industrial Equipment/Supply (GIE) 
 
Good opportunities exist for sales of new and refurbished equipment for 
key West Bank/Gaza industries.  Equipment is needed to upgrade the 
following industries with strong growth potential: food and beverage 
processing (39 percent of local manufacturing revenues) textiles and 
shoes (14 percent of manufacturing revenues), stone quarrying and 
cutting and pharmaceuticals. (45 percent of Israel's textile production 
is sourced in the West Bank and Gaza.)  For cost considerations, many 
local manufacturers prefer high quality refurbished plant equipment. 
 
5 - Construction Equipment (CON) 
 
Construction accounted for 18 percent of West Bank/Gaza GDP in 1990.  
The expansion of peace and concurrent international donor effort will 
spur extensive infrastructure and building development in the West Bank 
and Gaza.  Aside from the power and telecommunications sectors mentioned 
above, construction will be concentrated in roads, sanitation, and 
water.  Commercial and residential building is already underway.  The 
World Bank and PECDAR will develop long-range infrastructure development 
plans in 1995-96. Interested U.S. firms should contact key individuals 
at these agencies listed at the end of this report. 
 
6 - Agricultural Machinery and Equipment (AGM) 
 
Agriculture contributes 30% to West Bank GDP and 25% to Gaza GDP.  
Modern methods are gradually being introduced, bringing increased demand 
for modern agricultural equipment.  In particular, American expertise in 
building and operating feed mills will be useful in the West Bank and 
Gaza, where local production accounts for only 10% of consumption. 
 
7 - Automotive Parts and Service Equipment (APS) 
 
Extensive construction and a likely increase in Palestinian auto sales 
over the next five years will spur a need for a wide range of automotive 
parts and equipment.  Of particular interest to the local market are 
refurbished engines and other refurbished parts which are of good 
quality and competitively priced. 
 
8 - Franchising (FRA) 
 
Good opportunities exist for hardware and automotive parts franchising, 
particularly with competitive pricing. The fast food business is booming 
in Israel, and Palestinians enjoy eating American hamburgers, pizza and 
other popular food items.  American food franchisers may want to 
consider lower cost fast foods as a first step in entering the 
Palestinian market.  Opportunities exist for pizza, ice cream, and 
competetively priced hamburger and chicken meals. 
 
9 - Computers and Office Equipment (CPT, CSF) 
 
Palestinian Authority and municipal offices, as well as expanding 
private companies, need a full range of office equipment, including 
computers, software, copiers, faxes and supplies.  American expertise in 
the computer and software field is recognized by the local market, 
particularly by banks and other internationally-oriented enterprises.  
Arabic software and keyboards should be included in proposed sales. 
 
10 - Processed Foods (FPP) 
 
Although many food products in the West Bank and Gaza are imported from 
Israel, these are relatively expensive. Palestinian consumers know 
American brands and are willing to pay for good quality and 
internationally-recognized names. Good opportunities exist in snack 
foods, cereals, condiments and sauces and other foods which do not 
require refrigeration during transit. 
 
11 - General Consumer Goods (GCG) 
 
American consumer brands have an excellent reputation in the West Bank 
and Gaza. Competetively priced products, including household cleaning 
items, dental care goods, toiletries and hair care products, sold 
through a Palestinian distributor, should do well in the local market, 
as comparable Israeli items are expensive. 
 
12 - Management Consulting Services (MCS) 
 
West Bank and Gaza public and private institutions seek a variety of 
consulting services for product development, quality control, marketing, 
setting up corporate administrative systems, financial analysis and use 
of information systems technology. Several local firms and the U.S. 
Agency for International Development Small Business Support Program 
provide these services, but demand is growing rapidly, particularly for 
municipal and Palestinian Authority offices. International donor 
financing of technical training should increase as Israel transfers more 
authority to the Palestinians. U.S. consulting firms, already respected 
locally for their technical expertise, must offer competitive pricing to 
obtain public and private contracts. 
 
Best Prospects for Agricultural Products 
 
1 - Feed Grains (PS/D Code: 0459900) 
 
The West Bank and Gaza produce locally only 10 percent of total annual 
feed grain consumption.  There is ample room for U.S. exports of by 
products of the grain milling industries to be used as feed for local 
poultry and livestock.  With development of local feed and flour mills 
there will be excellent opportunities for raw material imports from the 
U.S.  Under the terms of the Israeli-Palestinian Economic Protocol, 
signed in April 1994, Palestinians may import grain from any source 
after consultation with Israel's agricultural authorities.  Palestinian 
grain and meal purchasers seek low cost sources. 
 
2 - Rice  (PS/D Code: 0422110) 
 
The West Bank and Gaza import 20-30,000 mt of rice annually.  
Competitive pricing by U.S. sources could make this an attractive 
market. 
 
3 - Dried Legumes  (PS/D Code: 0542XXX) 
 
The West Bank and Gaza import approximately 40 percent of total Israeli 
imports of peas, beans and other legumes. West Bank/Gaza 1994 imports 
were approximately: white beans: $1.4 million; lentils: $920,000; dried 
peas:$368,000; chick peas: $312,000. 
 
4 - Processed Oils  (PS/D Code: 4240000) 
 
Although the West Bank and Gaza produce large quantities of olive oil, 
other oils are not locally produced. Palestinian consumption of imported 
processed oils is higher than consumption of olive oil. There are 
moderate prospects for import of soy, corn, sunflower and rapeseed oils. 
 
Major Investment Opportunities 
 
The Government of the United States acknowledges the contribution that 
outward foreign direct investment makes to the U.S. economy.  U.S. 
foreign direct investment is increasingly viewed as a complement or even 
a necessary component of trade.  For example, roughly 60 percent of U.S. 
exports are sold by American firms that have operations abroad.  
Recognizing the benefits that U.S. outward investment brings to the U.S. 
economy, the Government of the United States undertakes initiatives, 
such as Overseas Private Investment Corporation (OPIC) programs, 
investment treaty negotiations, and business facilitation programs, that 
support U.S. programs. 
 
1 - Food and Beverage Processing and Packaging 
 
According to a recent survey, local and foreign businesses believe this 
sector, with almost 40 percent of total West Bank Gaza revenues, shows 
excellent growth prospects. While agricultural products are plentiful in 
the West Bank and Gaza, local companies manufacture mostly refined 
products, such as sweets, cookies and snack foods. Gulf and European 
markets provide a natural merchandising opportunity for U.S.-Palestinian 
joint venture food products. Opportunities for U.S. companies exist in a 
full range of fruit and vegetable canning and processing, and frozen 
food preparation.  Other opportunities include joint ventures to 
manufacture snack foods, cookies, and sauces. 
 
2 - Pharmaceutical Production 
 
Four of the largest and most successful West Bank companies produce 
pharmaceuticals.  These companies are well-run, with substantial 
available capital for expansion.  Some multinationals are already 
working with local pharmaceutical companies under distributorship 
arrangements, which will probably be expanded into joint manufacturing 
agreements.  Some West Bank pharmaceutical companies are now moving into 
light cosmetic production, and some are penetrating overseas markets in 
the Gulf, Eastern Europe and the former Soviet Union.  Good joint 
venture opportunities exist in this field, where local firms can benefit 
from U.S. quality-control techniques and new technologies, while 
offering relatively low wage structures. 
 
3 - Building Materials 
 
The building and construction materials industry, including stone and 
non-metallic minerals quarrying, employs 18 percent of all West 
Bank/Gaza workers, and was rated in a recent survey of local and 
international businessmen as having strong growth potential. A recent 
international survey rated stone-cutting as having high international 
competitiveness and growth potential.  Housing and commercial 
construction should continue to expand with private and public capital 
inflows to support extended Palestinian self-rule.  A U.S. cement form 
manufacturing firm which opened in Gaza in late 1994 is expanding to 
meet growing demand. 
 
4 - Light Assembly/ Technology 
 
The relatively well-educated local Palestinian population should, with 
the appropriate specialty training, contribute to a solid labor force 
for a wide variety of light assembly or electronics work.  Many 
Palestinians have excellent computer/software training, and small 
computer programming houses already exist in Ramallah and Bethlehem. 
Opportunities also exist in assembly of car parts (e.g. dashboards), 
light machinery and electronic products. 
 
5 - Hotel Construction and Upgrading 
 
Tourism, particularly with diaspora Palestinians, should increase over 
the next five years.  Before 1967, Ramallah was an important regional 
summer resort, and there is potential in this city for tourism 
development.  Current estimates of tourism demand range from 500,000 to 
1 million tourists annually, including religious pilgrims, enough to 
maintain a viable industry.  Tourist expenditures in the West Bank and 
Jerusalem averaged $90-100 million in 1989.  Existing Palestinian hotels 
are small and need upgrading.  New hotels and motels are needed for 
business and pleasure travelers.  Some West Bank cities, such as Hebron 
and Ramallah, have no international-standard hotel accommodations.  
Nablus has one new three-star hotel with 24 rooms. While smaller hotels 
are probably suitable for these cities, West Bank areas near Jerusalem 
could support larger hotels to accommodate tourists. 
 
6 - Plastics, Glass and China Housewares 
 
The city of Hebron in the West Bank is famous for glass production, and 
several small companies in this and other West Bank towns produce 
plastic and china products.  Local pharmaceutical companies also need 
plastic bottles for their products; currently these bottles are imported 
from Europe or Israel. Comparable regionally-made products are either 
expensive or of low quality. Opportunities exist for the manufacture and 
sale of household and industrial glass, china and plastic products for 
sale in the region and in the Gulf. 
 
7 - Furniture Manufacturing 
 
West Bank and Gaza furniture producers make high quality products, 
particularly wood and cane products. Production output is low (7% of 
manufacturing revenues), but the local tradition of pride in 
craftsmanship offers good potential for development and regional sales. 
 
8 - Jewelry, Handicrafts, Ethnic Imports 
 
The West Bank and Gaza are famous for olive wood, tiles and ceramics, 
mother of pearl and needlework products. With upgrading in design and 
quality, these products can be successfully marketed internationally.  
Small joint ventures with U.S. partners which focus on quality and 
developing ethnic designs, and appeal to western tastes, offer good 
investment opportunities. 
 
 
CHAPTER VI: TRADE REGULATIONS AND STANDARDS 
 
Import/export procedures for the West Bank/Gaza remain tied in large 
part to Israeli regulations.  The Palestinian Authority retains major 
control over imports into Gaza/Jericho, and this authority should extend 
to the rest of the West Bank after an interim agreement is signed.  
Israel retains quantitative control over some imports in key industries, 
such as dairy products, even for Gaza and Jericho. U.S. companies should 
work with Palestinian agents and/or the U.S. Embassy in Tel Aviv and 
U.S. Consulate General in Jerusalem to determine specific import/export 
requirements for their goods. 
 
Trade Barriers, Including Tariffs, Non-Tariff Barriers,Import Taxes 
 
In accordance with the Palestinian-Israeli economic agreement, U.S. as 
well as European and EFTA products are treated in the same way that 
Israel treats these products.  Therefore, the PA does not impose tariffs 
on U.S. products.  Like Israel, the PA does impose purchase taxes on 
many durable goods at Israeli rates. 
 
According to the 1994 Paris Economic Protocol, the Palestinian Authority 
does not impose tariffs on goods of Israeli origin. The Palestinian 
Authority imposes tariffs on goods imported from other countries 
according to individual agreements. 
 
The PA imposes a value-added tax (VAT) of 17% on all goods, whether 
imported or locally made, sold in the West Bank and Gaza. 
 
Customs Valuation 
 
The PA does not impose customs tax on goods imported from the U.S. 
 
Import Licenses 
 
Import Licenses for Gaza/Jericho, when required, are issued by the 
Palestinian Authority.  The importer must be a registered trader with 
the PA, and must present a pro-forma invoice and certificate of origin. 
In accordance with the Paris Economic Protocol, the PA must notify the 
Israeli Ministry of Industry about each import request. While the PA may 
import some items freely, other items are subject to quantitative 
restrictions according to the Paris Agreement. 
 
Imports to the rest of the West Bank, currently under Israeli 
regulations, may be subject to PA regulations after the signing of the 
Interim Agreement. 
 
Israel currently imposes licensing requirements and quantitative 
restrictions on a wide range of foods and agricultural products. For 
example, total annual cheese imports into the West Bank/Gaza are limited 
to 100 metric tons. All health-related imports, such as food and 
pharmaceuticals, require Palestinian Ministry of Health approval 
according to standards which are the same as those in Israel. 
 
Export Controls 
 
The Palestinian Authority has no export controls. However, Israeli 
security checks can hinder transfer of Palestinian goods at crossing 
points and ports. 
 
Import/Export Documentation 
 
For some specific items (approximately 15 percent of total imports), 
goods entering Gaza/Jericho, must be accompanied by a pro-forma invoice, 
packing list, a certificate of origin and an import license request.  
This will probably extend to the rest of the West Bank with the signing 
of an interim agreement.  The remaining 85 percent of imported items may 
be imported directly with a permit from the relevant PA ministry.  U.S. 
exporters should check with relevant personnel at the U.S. Embassy in 
Tel Aviv or the U.S. Consulate General in Jerusalem regarding specific 
items. 
 
For exports, the PA requires an invoice and a certificate of origin 
document signed by the local Chamber of Commerce and the Ministry of 
Economy and Trade. Permission to export is virtually automatic. No 
further documentation is required to transit the Allenby Bridge crossing 
to Jordan and Rafah crossing into Egypt. However, goods transiting 
Israeli ports require Israeli port documentation. 
 
Temporary Entry 
 
The PA has not yet established specific provisions for temporary entry 
of goods, and is currently using Israeli regulations. 
 
Labeling, Marking Requirements 
 
Goods entering the West Bank/Gaza may be bound by marking and labeling 
requirements in order to prevent leakage back into Israel.  Some goods 
such as cigarettes and laundry powders now have Arabic or Arabic/English 
stamps labeled "Only for sale in the West Bank and Gaza."  U.S. 
businesses should check with a Palestinian importer for exact 
specifications. 
 
Prohibited Imports 
 
Although the Palestinian Authority has no published prohibitions on 
imports, U.S. companies should check with local Palestinian distributors 
to see if restrictions (e.g. on food products, firearms) apply in 
certain cases. 
 
Standards (e.g. ISO 9,000 Usage) 
 
The Palestinian Authority has pledged to apply international standards 
requirements to all imports.  Currently, the PA uses Israeli standards 
codes for the import of all products which could affect health, e.g. 
foods, especially meat, and pharmaceuticals.  Most standards testing is 
conducted in Israeli labs, although the Palestinian Ministry of Health 
is beginning testing procedures.  Concrete and construction materials 
are being tested at Bir Zeit University. 
 
Free Trade Zones/Warehouses 
 
The Palestinian Authority, Israel and the international donor community 
are considering establishing industrial zones in the West Bank and Gaza 
to stimulate local economic activity and employment.  The concept 
remains in the planning stages, although it is likely that two "pilot" 
zones will be established initially, one in the West Bank and one in 
Gaza.  The zones will probably be export-oriented, although it has not 
been decided whether or not they will be strictly export-processing 
zones. 
 
Current plans envisage individual zones containing 200,000-600,000 
square meters industrial and commercial construction, and employing 
5,000 to 10,000 workers when fully developed.  Palestinian, Israeli and 
international firms will be invited to establish plants for industrial, 
service and commercial enterprises.  The management of the zones will 
probably offer investment incentive and tax relief packages.  The 
estimated cost of offsite infrastructure required for each zone will be 
about $20-25 million. 
 
Special Import Provisions 
 
The PA has no special import provisions. 
 
Membership in Free-Trade Arrangements 
 
In April 1995, the United States extended Generalized System of Tariff 
Privileges (GSP) to the West Bank and Gaza.  Over 4,500 locally-made 
goods may enter the U.S. duty-free under the GSP system.  Some products, 
such as textiles and shoes are not eligible for GSP benefits. The U.S. 
is considering extending free trade status to the West Bank and Gaza. 
 
The European Union has a preferential trade agreement with the West Bank 
and Gaza similar to that of the GSP program.  The Palestinian Authority 
has more restrictive trade agreements with Jordan and Egypt. 
 
Under the terms of the Economic Protocol signed in Paris in April, 1994, 
there are no restrictions on trade between the West Bank/Gaza and Israel 
except for quotas on six Palestinian agricultural exports into Israel 
(poultry, eggs, tomatoes, cucumbers, melons and potatoes). However, West 
Bank and Gaza exports entering Israel face significant barriers, 
principally as a result of Israeli security measures. 
 
 
CHAPTER VII: INVESTMENT CLIMATE 
 
Openness to Foreign Investment 
 
Currently, all new foreign investments in Gaza and Jericho must be 
registered with the Palestinian Authority and be approved by the 
relevant ministry or ministries.  Investments in the rest of the West 
Bank must be approved by local Israeli government offices.  Palestinian 
Authority responsibility for approving investments in the entire West 
Bank may increase following signature of an Interim Agreement with 
Israel.  PA corporate income tax is 38.5 percent of net profit.  PA 
personal tax rates are comparatively high: 40 percent for incomes 
between $28,000 and $49,000 and 48 percent for incomes over $49,000. 
 
The Palestinian Authority recently approved an Investment Promotion law, 
which provides exemption from taxes and other incentives for PA-approved 
domestic and foreign investments.  Under the law, all investors who want 
to take advantage of these incentives must apply to the Palestinian 
Council for the Promotion of Investment for project approval.  If the 
Council does not provide a written answer within 30 days, approval is 
automatic.  Interested firms must present to the Council a completed 
investment application and feasibility study. 
 
Prior PA approval at the Ministerial level is required for certain types 
of investments, including: aviation products and airport construction; 
waste recycling, including solid waste; production of petroleum and its 
derivatives; broadcasting and television; and all wired and wireless 
communication. 
 
The Investment Council, which will consist of representatives of 
different PA ministries and agencies, has not been formed yet, so the 
approval system has not been tested.  Interested U.S. investors should 
talk with the U.S. Embassy and Consulate General personnel in Tel Aviv 
and Jerusalem, respectively, or with relevant PA ministry officials 
regarding investment approval requirements. 
 
Conversion and Transfer Policies 
 
The PA Investment Law guarantees the repatriation of foreign capital. 
There is no new PA legislation governing foreign currency accounts and 
currency transfer policies.  The Interim Agreement under negotiation 
between Israel and the Palestinians may deal with currency transaction 
issues, and U.S. investors should seek up-to-date information with 
relevant U.S. Embassy and Consulate General personnel in Tel Aviv and 
Jerusalem. 
 
Expropriation and Compensation 
 
The PA Investment Law prohibits expropriation and nationalization of 
approved foreign investments. 
 
Dispute Settlement 
 
The PA Investment Law provides for dispute resolution between the 
investor and official agencies in Palestinian courts, unless the 
Investment Council permit states otherwise.  However, the PA has not set 
up courts to adjudicate such disputes.  Civilian courts in Gaza operate 
under a modernized version of British Mandate law.  Civilian courts in 
the West Bank operate under Jordanian law, amended by PA law for Jericho 
and by Israeli military orders for the rest of the West Bank.  The 
civilian court system in the West Bank has had no enforcement system, 
although this may change with implementation of an interim agreement 
between Israel and the Palestinians.  The Gaza civil court system has a 
heavy backlog of cases. 
 
Alternative dispute resolution mechanisms in the West Bank and Gaza 
range from conventional arbitration and mediation to village, tribal and 
religious tribunals and traditional methods of conciliation. Alternative 
dispute resolution usually is less costly and quicker than the court 
system, although judgments other than those reached through formal 
arbitration are enforceable only on the basis of honor and social/family 
pressure;there is no civil law enforcement system in the West Bank.  Law 
enforcement in Gaza/Jericho is in nascent stages, although observers say 
the security situation in Gaza has improved significantly with the 
growing professionalization of the Gaza police. 
 
Political Violence 
 
Terrorist activity in the past has usually been directed at Israeli, not 
international or Palestinian targets.  However, terrorist attacks 
against Israel normally result in sealing off the West Bank and Gaza 
from Israel, which makes the transfer of goods and workers extremely 
difficult.  The perceived potential for civil strife, particularly in 
Gaza, has caused concern by potential international investors, but with 
the growing authority of the PA, a new outbreak of civilian violence 
seems increasingly unlikely. 
 
Performance Requirements/Incentives 
 
The Investment Law states that territories under the jurisdiction of the 
Palestinian Authority will be designated as Zones A, B, and C, according 
to level of economic development and planning priorities.  This is 
similar to the zonal system in Israel.  The PA has not yet designated 
these development zones. 
 
The following incentives apply to investments which have been approved 
by the Investment Council: 
 
--Paid-in capital of at least $100,000 and less than $150,000, with 
minimum of 10 Palestinian employees, with project life of at least 5 
years: three year tax holiday. 
 
--Paid-in capital of at least $150,000 and less than $500,000, with a 
minimum of 15 Palestinian employees and a project life of at least 6 
years: four year tax holiday. 
 
--Paid-in capital over $500,000, with a minimum of 25 Palestinian 
employees and project life of at least 10 years: six year tax holiday. 
 
Right to Private Ownership and Establishment 
 
The right to private ownership in Gaza is guaranteed by British Mandate 
law, as amended by the Palestinian Authority. The right to private 
ownership is guaranteed by Jordanian law in the West Bank, as amended by 
PA regulations in Jericho, and by military order in the rest of the West 
Bank.  Foreigners must obtain permission from the Palestinian Authority 
before purchasing property in Gaza and Jericho, and from the Israeli 
Civil Administration before purchasing property in the rest of the West 
Bank.  The West Bank legal situation may change with adoption of an 
Interim Agreement. 
 
Protection of Property Rights 
 
Property rights in Gaza are protected by British Mandate law, and in 
Jericho by Jordanian law, both as amended by the Palestinian Authority. 
Property rights in the rest of the West Bank are protected by Jordanian 
law as amended by Israeli military orders.  In certain situations, up to 
40 percent of private property in the West Bank and Gaza may be taken 
for public purposes without compensation. 
 
Regulatory System - Laws and Procedures 
 
The PA has not yet promulgated regulations pertaining to commercial 
investments.  These regulations are expected to supplement the current 
investment law. 
 
Bilateral Investment Agreements 
 
The PA does not yet have bilateral investment agreements. 
 
OPIC and Other Investment Insurance Programs 
 
The Overseas Private Investment Corporation (OPIC) provides a variety of 
services to qualified U.S. investors in emerging economies and 
developing nations.  During the early stages of investment planning, 
U.S. investors may contact OPIC for insurance against political 
violence, inconvertibility of currency, and expropriation, in the form 
of an insurance registration letter.  OPIC insurance is not available 
after the investment has been irrevocably committed.  Typical rates for 
most projects are: 
 
Annual base rate of $100 coverage 
 
Inconvertibility                  $0.30 
Expropriation                     $0.60 
War, revolution, insurrection     $0.60 
Civil strife rider                $0.15 
 
MIGA, the Multilateral Investment Guarantee Agency of the World Bank, is 
a private sector agency which provides risk insurance and investment 
guarantees similar to that of OPIC. MIGA is actively considering 
extending coverage to the West Bank and Gaza. 
 
Labor 
 
The West Bank and Gaza have a high proportion of relatively young and 
skilled labor, and the labor force currently numbers around 400,000.  
Many Palestinians have trained outside the area and are familiar with 
foreign business practices. The percentage of illiterate workers dropped 
from 21 percent in 1987 to 16 percent in 1991. The largest proportion of 
Palestinian labor, 36 percent, is employed in agriculture.  
Approximately 13 percent of the workforce is employed in each of the 
following sectors: manufacturing, construction, social services, trade.  
Seven percent of the labor force is female.  Before the beginning of the 
Intifada in 1987, approximately 125,000 Palestinians (40 percent of the 
Palestinians employed at that time) worked inside Israel.  Now about 
33,000 Palestinians work inside Israel.  Unemployment is reportedly 
high: recent figures show 50 percent unemployment in Gaza and 30 percent 
unemployment in the West Bank.  These figures are probably misleading, 
as at least some Palestinian businesses under-report employees and 
production in order to avoid income taxes. 
 
Wages in the West Bank and Gaza average about $310 per month.  While 
this is approximately three times average monthly wages in Jordan, it is 
about one-fourth of Israeli average monthly wages.  While there are 
labor unions in the West Bank and Gaza, they are splintered into over 
150 smaller units, and exercise marginal power. In general, local trade 
unions have existed more as political organizations rather than as 
unions in the western sense. 
 
Foreign Trade Zones/Free Ports 
 
There are no foreign trade zones in the West Bank and Gaza.  Proposed 
Industrial Parks outlined in Chapter VI above will probably be export-
oriented, but no firm decisions have been made. 
 
Capital Outflow Policy 
 
Although repatriation of investment capital is allowed under the PA 
Investment Law, there are no PA laws concerning exchange controls.  The 
Palestinian Monetary Authority is currently working on exchange control 
legislation. 
 
Major Foreign Investors 
 
Limited foreign investment flows began in 1994-5, with the majority of 
funds coming from regional Palestinian investors.  The largest foreign 
company in the West Bank and Gaza is PADICO, the Palestine Development 
and Investment Company, which has pledged at least $200 million in 
investment.  Key PADICO investors include diaspora Palestinians from 
Jordan, Great Britain and the Gulf.  PADICO plans investments in 
telecommunications, tourism, real estate, housing and industrial parks. 
 
CHAPTER VIII: TRADE AND PROJECT FINANCING 
 
Brief Description of Banking System 
 
With seven Arab banks and over 25 branches now operating in the West 
Bank and Gaza, the local banking sector has undergone rapid growth since 
the signing of the Gaza-Jericho Agreement in May, 1994.  Many banks have 
returned to former positions operating during the pre-1967 period.  A 
number of additional banks are scheduled to begin operations soon.  
Three Israeli banks also maintain branches in the West Bank. 
 
Cairo-Amman Bank is the largest bank operating in the West Bank/Gaza, 
with 17 branches and over 700 employees.  It handles accounts for most 
PA ministries, including the Ministry of Finance, PECDAR and the 
Ministry of Planning.  It offers extensive overdraft privileges to the 
PA. 
 
The Palestinian-owned Arab Bank is the largest in the Arab world, and 
has six existing branches in the West Bank and Gaza.  The bank offers a 
wide array of international banking privileges, and is highly regarded 
among the local and international business communities. 
 
West Bank and Gaza banks routinely deal in the Israeli Shekel and 
Jordanian Dinar.  Banks in Gaza and Jericho under PA control may hold 
dollar accounts, and are beginning to develop some offshore banking 
services.  Israeli shekels are preferred for operations, and Jordanian 
dinars are preferred for savings.  For Israeli shekel accounts, local 
banks must maintain correspondence relationships with Israeli banks. 
 
Local banks currently have a relatively conservative approach, primarily 
due to the fact that the lack of a banking legal or commercial 
regulatory structure makes it nearly impossible to recoup non-paying 
loans. 
 
Local banks generally offer savings and checking accounts, and some 
personal and commercial lending.  Jordanian dinars generally cost about 
11.5 to 12 percent--9 percent in interest and a 3.5 percent "service 
charge."  Israeli shekel loans cost about 21-24 percent annually.  These 
rates are reflected in savings interest as well.  Most commercial and 
private lending is done on a short-term basis of one to three years and 
one to four years, respectively, with shorter terms the norm.  Firms 
often must put up the full amount of the loan or more as collateral. 
 
Foreign Exchange Controls 
 
The Palestinian Monetary Authority has not set up foreign exchange 
regulations for Gaza and Jericho.  Banks in the rest of the West Bank 
operate under Israeli and Jordanian banking regulations, although this 
may change with the signing of an Interim Agreement between Israel and 
the Palestinians.  West Bank banks must use the Bank of Israel (shekels) 
and Central Bank of Jordan (dinars) to handle all foreign exchange 
transactions. 
 
General Financing Availability 
 
As noted above, credit from local banks is scarce due to the lack of a 
legal code to enforce loan collection and generally conservative local 
banking practices.  Most local businesses use their own capital to 
finance operations, or work with one of the European credit agencies 
described below, or international joint venture partners. 
 
How to Finance Exports/Method of Payment 
 
Most local importers use Letters of Credit.  U.S. firms should use 
contractual arrangements to ensure fulfillment of payment obligations, 
particular when beginning a business relationship. 
 
The U.S. Export-Import Bank (EXIM) offers insurance, loan and guarantee 
programs to facilitate export financing of U.S. goods and services.  
Because EXIM does not yet have an agreement with the Palestinian 
Authority, export financing through this agency must be done with an 
obligor or guarantor from outside the West Bank and Gaza in a country 
which does have an EXIM agreement (e.g. Jordan). 
 
Export credit insurance programs can be obtained from EXIM's Insurance 
Division.  Two short-term (maximum 180 days) policies are designed for 
small new-to-export businesses.  Each provide 95 percent of the 
commercial risk and 100 percent of the political risk involved in 
extending credit to U.S. exporters' overseas customers.  The pre-export 
working capital program is administered in cooperation with the Small 
Business Administration. 
 
EXIM also provides direct loans to foreign buyers of U.S. products and 
intermediary loans to fund commercial lenders who extend loans to 
foreign buyers of U.S. capital goods and related services.  Since EXIM 
does not yet have a formal agreement with the Palestinian Authority, 
export finance arrangements require that either the obligor or guarantor 
come from a third country which has an agreement with EXIM. For example, 
Palestinian importers of U.S. goods may use a guarantor from Jordan. 
 
Guarantees by EXIM provide repayment protection for private sector loans 
to creditworthy buyers of U.S. capital equipment and services.  The 
guarantees cover 100 percent of principal and interest. 
 
The Small Business Administration (SBA) offers loan guarantees enabling 
the small U.S. exporter to obtain financing through a commercial bank.  
Export working capital loans are short-term (12 months) and are designed 
to support single transactions.  SBA's regular business loan program is 
also available to export trading and export management companies.  The 
international trade loan program provides long-term financing to help 
small businesses compete more effectively and to expand or develop 
export markets. 
 
The Foreign Agricultural Service (FAS) of the U.S. Department of 
Agriculture (USDA) administers the market promotion program, which helps 
U.S. producers and other organizations finance promotional activities 
for U.S. products, through funds from USDA's Commodity Credit 
Corporation (CCC).  These funds can also be used for market research, 
consumer promotions and technical assistance. 
 
Project Financing 
 
Project finance is available to U.S. investors from the following U.S. 
government agencies: OPIC, EXIM, and the Trade and Development 
Administration (TDA).  The World Bank's International Finance 
Corporation (IFC) and the European Community's local development banks 
and credit agencies also provide project finance, although loans from 
the latter generally go to local Palestinian companies or to firms with 
a connection to European companies. 
 
OPIC operates two major financing programs: direct loans and loan 
guarantees.  American investors planning to share significantly in the 
equity and management of a venture in Gaza and the West Bank may use 
OPIC's medium- to long- term financing (5-12 years).  OPIC's financing 
commitment to a new project may not exceed 50 percent of the total 
project cost.  OPIC loans usually range from $100,000 to $4 million. 
Interest rates vary according to the project's financial and political 
risk. 
 
OPIC's loan guarantee program is available to all U.S. businesses 
regardless of size.  OPIC issues commercial and political risk 
guarantees under which funding can be obtained from a variety of U.S. 
financial institutions. Typically, OPIC loan guarantees range from $1 to 
$25 million, but they may reach $50 million.  Interest rates are 
comparable to those of other U.S.G.-guaranteed issues of similar 
maturity. 
 
EXIM Bank provides project finance in the form of direct loans, 
guarantees or a combination of both through its new Project Finance 
Division, in which outside consultants are contracted to evaluate 
projects.  These services are available to major U.S. suppliers and to 
project sponsors without access to bank or government guarantees.  The 
equity investor must be creditworthy and must be exposed to meaningful 
financial risk.  The direct loan and/or guarantee can cover up to 85% of 
the contract amount.  The Bank is committed to completing its evaluation 
and issuing a preliminary indication of willingness to finance a project 
within 45 days from the day all the required documentation is submitted 
with the application for financing. 
 
The Trade and Development Administration (TDA) promotes economic 
development in developing countries by funding feasibility studies, 
consultancies, training programs and other project planning services.  
In 1994-5 TDA financed feasibility studies for a food processing 
facility, an olive oil production facility in the West Bank and a 
refinery in Gaza.  TDA also organized and financed orientation visits to 
the U.S. for power and telecommunications officials from Gaza and the 
West Bank. 
 
The International Finance Corporation (IFC) is the private sector arm of 
the World Bank, which was established to encourage private sector 
activities in developing countries.  IFC provides loans, equity 
investments, guarantees and stand-by financing. 
 
Following the signing of the Declaration of Principles (DOP) in 
September, 1993, the United States pledged $500 million for assistance 
for assistance to the Palestinians over a five year period.  Of this, 
$375 million will be administered though Agency for International 
Development (AID) programs, and the remaining $125 million through 
investment guarantees provided by the Overseas Private Investment 
Corporation (OPIC), as described above. 
 
USAID's programs focus on basic infrastructure, such as housing and 
water and wastewater systems, short-term job creation through small-
scale community infrastructure development, private sector development 
and support for activities in democracy and governance.  Examples 
include the 40 million Gaza wastewater and stormwater project, the $25 
million small-scale community infrastructure project, and the $1 million 
Small Business Support project.  The USAID program is implemented 
through international organizations such as the United Nations 
Development Program (UNDP) and the United Nations Relief Works Agency 
for Palestine (UNRWA), U.S. contractors and U.S. private voluntary 
organizations.  In addition, USAID provides support for the start-up 
costs of the Palestinian Authority through the World Bank's Holst Fund. 
 
List of Banks with Correspondent U.S. Banking Arrangements 
 
The Cairo-Amman Bank has a correspondence relationship with Citibank and 
the Arab Bank has arrangements with a large number of U.S. banks.  The 
newly established Palestine National Bank is currently negotiating 
correspondence arrangements with several U.S. banks. 
 
 
CHAPTER IX:  BUSINESS TRAVEL 
 
Business Customs 
 
Business in the West Bank and Gaza is personal and family-oriented, 
built on trust and long-term relationships.  However, this trend is 
slowly changing and a recent business survey indicated that 60 percent 
of larger local businesses are non-family-owned.  West Bank and Gaza 
businessmen are pragmatic and generally apolitical, and the owners of 
larger enterprises have internationally-based contacts and experience. 
Although business orientation has in the past tended to be toward Europe 
and the Gulf, local entrepreneurs seek American partners because of 
their technical expertise and know-how. 
 
U.S. businessmen who travel to the area should concentrate on building 
strong personal relationships with potential partners.  It is customary 
to discuss plans over cups of strong Arabic coffee or tea, and often to 
be invited to the family home or out for a restaurant meal. 
 
Most major Palestinian businessmen speak good English, although for 
negotiating contractual terms, it is advisable to use a good translator, 
who might be a local attorney assisting with the deal. Palestinians 
dress more formally than Israelis, usually in western business suits. 
Business cards are always exchanged.  Appointments can be made on short 
notice. 
 
The normal workweek varies depending on the business, although most 
firms are closed on Fridays (Muslim holiday), even if the owner is 
Christian. Christian-owned firms are also generally closed on Sundays. 
 
Travel Advisory and Visas 
 
Israel occupied the lands known as the "Occupied Territories" (the West 
Bank, Gaza Strip, Golan Heights, and East Jerusalem) as a result of the 
1967 war.  Pursuant to the September 13, 1993, Israel-PLO Declaration of 
Principles on interim self-government arrangements (DOP); the May 4, 
1994, Cairo Agreement on the Gaza Strip and Jericho Area; and the August 
29, 1994, agreement on preparatory transfer of powers and 
responsibilities, certain powers and responsibilities for the Gaza 
Strip, Jericho Area and the West Bank have been transferred to the 
Palestinian Authority.  The DOP provides that Israel will retain 
responsibility during a five-year transitional period for external 
security and for internal security and public order of settlements and 
Israelis.  During this transitional period, definitive information on 
entry and customs requirements, arrests, and other matters may not be 
available, or may change without prior notice.  Should questions arise 
in the West Bank, including the Jericho area, U.S. citizens may 
telephone the U.S. Consulate General in Jerusalem for assistance 
(telephone: 972-2-253288).  For questions concerning the Gaza Strip, 
U.S. citizens may telephone the U.S. Embassy in Tel Aviv (telephone: 
972-3-519-7575) or the U.S. Citizen Services Section directly (972-3-
519-7524 or 519-7453 or 519-7454). 
 
Entry Requirements:  Passports, an onward or return ticket, and proof of 
sufficient funds are required for entry to Israel and the occupied 
territories.  A three-month visa may be issued for no charge upon 
arrival, and may be renewed.  (Visitors who plan to travel to Arab 
countries with no diplomatic relations with Israel may request to have 
their Israeli entry visas stamped on a separate form at the port of 
entry).  Anyone who has been refused entry or experienced difficulties 
with his/her visa status during a previous visit, or who has overstayed 
a visa, can obtain information from the Israeli Embassy or nearest 
consulate regarding the advisability of attempting to return to Israel.  
Permission must be obtained from Israel for anyone attempting to claim 
the status of a returning resident in Gaza or the Jericho Area.  At 
present, U.S. citizens may enter and exit Gaza and the Jericho area on a 
U.S. passport, without obtaining visas from either Israel or the 
Palestinian Authority.  Private vehicles frequently encounter long 
delays entering or leaving Gaza.  Only cars with special permits are 
allowed to cross the checkpoints. 
 
International crossing points are now in operation between Israel and 
Jordan at Arava (Wadi Al-Arabah) crossing in the South, and the Jordan 
River crossing (Sheikh Hussein Bridge) in the North.  Prior visas are 
not necessary for American citizens using these two crossing points.  
According to a recent agreement between the Jordanian and Israeli 
governments border crossings in both directions in private vehicles will 
be allowed as of mid-August 1995.  Crossing procedures for the Allenby 
Bridge, linking Jordan and the occupied West Bank, remain unchanged.  
Prior visas and bridge crossing permits are required to cross the 
Allenby Bridge. 
 
Procedures for all crossings into Jordan are subject to frequent 
changes.  Travelers wishing the most up-to-date border crossing 
information should contact the U.S. Embassy in Tel Aviv or the U.S. 
Consulate General in Jerusalem.  For further entry information, 
travelers may contact the Embassy of Israel, 3514 International Drive, 
N.W., Washington, D.C. 20009, telephone (202) 364-5500, or the nearest 
Israeli Consulate General in Los Angeles, San Francisco, Miami, Atlanta, 
Chicago, New Orleans, Boston, New York, Philadelphia, Houston. 
 
1995-6 Holidays 
 
The following Muslim holidays are observed in Gaza and the West Bank. 
The Jerusalem Consulate General is closed on these holidays. 
 
 
Early February        Eid Al Fitr (Moslem Feast ending fasting month 
                          of Ramadan - U.S. Embassy remains open) 
Early May            Eid Al Adha (Moslem Feast of the Sacrifice- 
                          U.S. Embassy remains open) 
 
Following is a list of official Jewish and American holidays observed by 
the American Embassy, Tel Aviv.  The Jerusalem Consulate General is 
closed on the American holidays. 
 
1995 
September 25    *Rosh Hashana (New Year - first day) 
September 26    *Rosh Hashana (New Year - second day) 
October 4       *Yom Kippur (Day of Atonement) 
October 9       *Succot (Feast of Tabernacles) 
October 16      *Simhat Tora (Rejoicing of the Law) 
November 10      Veterans Day 
November 23      Thanksgiving Day 
December 25      Christmas Day 
 
1996 
January 1        New Year's Day 
January 15       Martin Luther King's Birthday 
February 19      President's Day 
April 4         *Passover (first day) 
April 10        *Passover (last day) 
April 24        *Israeli Independence Day 
May 24          *Shavuot (Pentecost) 
May 27           Memorial Day 
July 4           Independence Day 
September 2      Labor Day 
September 14    *Rosh Hashana (New Year - first day) 
September 15    *Rosh Hashana (New Year - second day) 
September 23    *Yom Kippur (Day of Atonement) 
September 28    *Succot (Feast of Tabernacles) 
October 5       *Simhat Torah (Rejoicing of the Law) 
October 14       Columbus Day 
November 11      Veterans Day 
November 28      Thanksgiving Day 
December 25      Christmas Day 
 
*  Jewish and Israeli Holidays: All businesses in Israel are closed 
 
Jewish holidays commence at sunset, the day before. 
Many Israeli businesses are closed for the duration of Passover (7 days) 
and Succot (8 days). 
 
Business Infrastructure 
 
Language 
All Palestinians speak Arabic.  Most heads of larger companies and many 
other Palestinians speak good English. 
 
Transportation 
Public bus service is sporadic.  U.S. business visitors should use one 
of the several taxi services in East Jerusalem for travel in East 
Jerusalem and the West Bank.  For longer-term stays, business visitors 
may want to rent a car.  It is advisable to rent a car in East Jerusalem 
(rather than from an Israeli agency) for travel in the West Bank, due to 
the possibility of politically-based damage to Israeli cars. 
 
Travel to and from Gaza is time-consuming; business visitors should 
allow a full day for travel and meetings there.  Most visitors hire a 
taxi in Tel Aviv or Jerusalem to travel to the Erez crossing point into 
Gaza, and then have a local Gaza contact send a car for pickup on the 
Gaza side.  Israeli security authorities do not permit most Israeli and 
West Bank vehicles to enter Gaza. 
 
Communications 
Telephone and fax connections within the West Bank are adequate. 
Communication with Gaza is more difficult due to inadequate 
telecommunications facilities.  Many Palestinian Authority ministries 
and businesses use cellular telephones.  Short-term cellular phone 
rental is also available for business visitors; cellular phone coverage 
in Gaza is spotty. 
 
Hotels and Restaurants 
There is a good selection of hotels and restaurants in East and West 
Jerusalem, and a wide variety in Tel Aviv.  Hotels in the West Bank and 
Gaza are generally not up to international business standards. 
 
Restaurants in Ramallah and Jericho serve traditional Palestinian food; 
new restaurants have recently opened in Gaza, Nablus and Bethlehem. 
Since the establishment of the Palestinian Authority in Gaza, a number 
of new and pleasant restaurants have sprung up along the Gaza shore. 
Although visitors should take care to ensure that local restaurants have 
good refrigeration in the summer, most restaurants which U.S. 
businessmen will visit observe acceptable health standards. 
 
Medical Facilities 
Modern medical facilities exist in Jerusalem and throughout Israel. 
Travelers can find information in English about emergency medical 
facilities and after-hours pharmacies in "The Jerusalem Post" newspaper.  
Most doctors and hospitals expect immediate cash payment for services.  
U.S. medical insurance is not always valid outside the U.S. and 
supplemental medical insurance with specific overseas coverage can be 
useful.  Travelers can obtain additional health information from the 
"International Travelers Hotline" of the Center for Disease Control, 
tel: (404) 332-4559. 
 
 
APPENDIX A: COUNTRY DATA 
 
--Population:                    2,300,000 
 
--Population Growth Rate:        4.1% (West Bank); 5.1% Gaza 
 
--Religions:                     Islam, Christianity 
 
--Government:                    Gaza/Jericho: Self-Governing Authority 
 
--Languages:                     Arabic; English spoken at 
                                   senior business/government level 
 
--Work Week:                     Saturday - Thursday afternoon 
 
 
APPENDIX B: DOMESTIC ECONOMY 
 
Please note that macroeconomic data for the West Bank and Gaza is 
sketchy, so not all categories of interest to U.S. businesses are 
included in this report. Figures are in USD millions except where noted. 
 
Item                                          1993 
 
GDP                                          2,593 
GDP Growth Rate          3.5% West Bank; 1.6% Gaza 
GDP Per Capita                            1,192.00 
Inflation                                    11.2% 
Unemployment               17% West Bank; 28% Gaza 
Foreign Exchange Reserves                      N/A 
Average Exchange Rate         2.83 Israeli shekels 
 (for USD 1.00) 
Debt Service Ratio                             N/A 
U.S. Economic Assistance        1994: $100 million 
 
 
APPENDIX C: TRADE DATA 
 
Note: The following estimated figures are based on information provided 
by the Government of Israel and the PA. 
 
(in USD millions except where noted) 
 
 
Item                        1993            1994            1995 
 
Total Exports                270             353             318 
Total Imports              1,094           1,526           1,675 
Trade Balance                824           1,038           1,157 
U.S. Exports                 N/A             N/A             N/A 
U.S. Imports                 N/A             N/A             N/A 
 
 
APPENDIX D:  INVESTMENT STATISTICS 
 
Not available. 
 
APPENDIX E 
 
WEST BANK, GAZA & U.S. CONTACTS 
 
Palestinian Authority Agencies 
 
* Please note that in most cases it is better to contact Palestinian 
Authority offices by fax or telephone rather than by letter. 
 
Ministry of Economy, Trade & Industry 
P.O.Box 1629 
Dahyett El-Bareed, West Bank 
Contact:  Mr. Ahmad Qurei (Abu Ala'a) 
          Minister 
Tel:  972-2-9980040 /2/3 
Fax:  972-2-9980041 
 
Ministry of Trade 
P.O.Box 1629 
Dahyyet El-Bareed, West Bank 
Contact:  Mr. Samir Huleileh 
          Deputy Undersecretary 
Tel:  972-2-9980040 /2/3 
Fax:  972-2-9980041 
 
Ministry of Industry 
P.O.Box 1629 
Dahyyet El-Bareed, West Ban 
Contact:  Mr. Adnan Samara 
          Undersecretary 
Contact:  Dr. Jawad El-Naji 
          Assistant Undersecretary 
Tel:  972-2-9959032 
 
Palestinian Economic Council for Development & Reconstruction (PECDAR) 
P.O.Box 1629 
Dahyyet El-Bareed, West Bank 
Contact:  Mr. Samir Abdallah 
Tel:  972-2-9980040 /2/3 
Fax:  972-2-9980041 
 
Ministry of Finance 
P.O.Box 4007 
Gaza 
Contact: Mr. Mohammed Zuhdi Nashasshibi 
         Minister 
Tel:  972-7-829243/4  972-7-863994 
Fax:  972-7-820696  972-7-82436 
 
Ministry of Tourism & Archeology 
P.O.Box 534 
Bethlehem, West Bank 
Contact:  Mr. Elias Freij 
          Minister 
Contact:  Mr. Bajes Ismail 
          Director General 
Tel:  972-2-741581 
Fax:  972-2-743753 
 
Ministry of Transportation 
P.O.Box 246 
Ramallah, West Bank 
Contact:  Mr. Abdul Aziz Haj Ahmad 
          Minister 
Contact:  Mr. Mohammad Al Qawasmeh 
          Director General 
Tel:  972-2-9955560 
Fax:  972-2-9951901 
 
Ministry of Planning & International Cooperation 
P.O.Box 4017 
Gaza 
Contact:  Mr. Nabil Sha'th 
          Minister 
Contact:  Mr. Majdi Al Khaldi 
          Director general 
Tel:  972-7-829260 / 829033 / 868971 
Fax:  972-7-824090 
 
Ministry of Housing 
P.O.Box 4034 
Gaza 
Contact:  Mr. Zakaria Al Agha 
          Minister 
Contact:  Dr. Mohammad Salim Zeyarah 
          Director General 
Tel:  972-7-822233 /4 
Fax:  972-7-822235 
 
Ministry of Agriculture 
Abu Khadrah Building 
Gaza 
Contact:  Mr. Mohammad Zuhdi Nashashibi 
          Minister 
Contact:  Dr. Azzam Tbaileh 
          Director General 
Tel:  972-7-829123 /4/5/6 
      972-7-863924 /3/6 
Fax:  972-7-863926 
 
Ministry of Post & Telecommunications 
Jericho, West Bank 
Contact:  Dr. Abdul Hafeef Al-Ashhab 
          Minister 
Tel:  972-2-9923211  972-2-9922514  972-2-9922633 
Fax:  972-2-9922233  972-2-9922499 
 
Palestine Civil Aviation Department 
P.O.Box 4043 
Gaza 
Contact:  Mr. Fayez Zaidan 
          Director General 
Tel:  972-2-822800 
Fax:  972-2-821309 
 
Jerusalem Electric Corporation 
P.O.Box 19118 
Sallah Eddin St. 
East Jerusalem 
Contact:  Mr. Mohammad Ali El-Husseini 
          General Director 
Tel:  972-2-282335  972-2-281024 
Fax:  972-2-282441 
 
Trade Associations and Chambers of Commerce 
 
Federation of Palestinian Chambers of Commerce, Industry & Agriculture 
P.O.Box 54107 
Jerusalem 
Contact:  Mr. Ali Qadourah 
          President 
Contact:  Mr. Abdel Ruhman Abu Leil 
          Secretary General 
Tel:  972-2-280727 
Fax:  972-2-280644 
 
Bethlehem Chamber of Commerce & Industry 
P.O.Box 59 
Bethlehem, West Bank 
Contact:  Mr. Elias Freij 
          President 
Tel:  972-2-742742 
Fax:  972-2-741327 
 
Hebron Chamber of Commerce. 
P.O.Box 272 
Hebron, West Bank 
Contact:  Mr. Hashim El Natsheh 
          President 
Contact:  Mr. Maher El Haimouni 
          Secretary General 
Tel:  972-2-9928218 / 9927491 
Fax:  972-2-9927490 
 
Jericho Chamber of Commerce, Industry & Agriculture 
Jericho, West Bank 
Contact:  Mr. Mansour Salaymeh 
          President 
Contact:  Mr. Tawfic Nweiser 
        Secretary General 
Tel:  972-2-9923313 
Fax:  972-2-9922394 
 
Nablus Chamber of Commerce & Industry 
P.O.Box 35 
Nablus, West Bank 
Contact:  Mr. Ma'az Nabulsi 
          President 
Contact:  Mr. Taj Eddin Bittar 
          Secretary General 
Tel:  972-9-380335 / 972-9-379615 
Fax:  972-9-377605 
 
Ramallah Chamber of Commerce 
P.O.Box 256 
Ramallah, West Bank 
Contact:  Mr. Assad Faris Hassouneh 
          President 
Contact:  Mr. Salah El-Odeh 
          Secretary General 
Tel & Fax:  972-2-9955052 / 972-2-9956043 
 
Palestinian Chamber of Commerce 
P.O.Box 33 
Gaza 
Contact:  Mr. Mohammad Al Qudweh 
          President 
Contact:  Mr. Nu'man Youssif Deeb 
          Deputy 
Tel & Fax:  972-7-864588 / 972-7-821172 
 
The European-Palestinian Chamber of Commerce 
Nablus Road, Jerusalem 
Contact:  Mr. Hanna Siniora 
Tel:  972-2-894883  972-2-273293 
Fax:  972-2-894975 
 
Higher Council for The Arab Tourist Industry 
P.O.Box 19850 
Jerusalem 
Contact:  Mr. Hani Abu-Dayyeh 
Tel:  972-2-281040 
Fax:  972-2-818178 
 
Palestinian Energy Authority 
P.O.Box 3591 
El-Bireh, West Bank 
Contact:  Mr. Abdul Rahman Hamad 
          Director 
Tel:  972-2-9986190  972-2-9986192 
Fax:  972-2-9986191 
 
Market Research/Business Consulting Firms 
 
DAI - Small Business Support Project 
P.O.Box 54807 
Jerusalem 
Contact:  Mr. Tim Smith 
          Director 
Tel:  972-2-274676 
Fax:  972-2-276285 
 
El Rowad - Skills Development Center 
P.O.Box 51052 
Jerusalem 
Contact:  Mr. Iyad Nuseibeh 
          Office Manager 
Tel & Fax:  972-2-834285 
 
DATA - Studies & Consultation 
P.O.Box 486 
Bethlehem, West Bank 
Contact:  Mr. Samir Hazboun 
          Director 
Tel:  972-2-743343 
Fax:  972-2-743369 
 
Team Palestine 
P.O.Box 18452 
Shu'fat, Jerusalem 
Contact:  Mr. Mohamad Halaiqa 
          Director 
Tel:  972-2-858920 /22 
Fax:  972-2-858915 
 
Bir Zeit University 
Continuing Education Department 
P.O.Box 14 
Ramallah, West Bank 
Contact:  Mrs. Haifa' Baramki 
          Director 
Tel & Fax:  972-2-956229 
 
Development Research Center 
P.O. Box 23 
Gaza 
Contact:  Ala'a Eddin Shawa 
Tel:  972-7-869887/ 824275 
Fax:  972-7-821820 
 
Bir Zeit University 
National Foundation for Investment & Development 
P.O.Box 25221 
Shu'fat, Jerusalem 
Contact:  Mr. Hazem Shunnar 
          Executive Director 
Tel & Fax:  972-2-829210 
 
Bethlehem University 
Business Development Center 
P.O.Box 9 
Bethlehem, West Bank 
Contact:  Mr. Hanna Sahar 
          Manager 
Tel & Fax:  972-2-745559 
 
Commercial Banks 
 
Arab Bank 
P.O.Box 1476 
Tannous Building 
Ramallah, West Bank 
Contact:  Mr. Shukri Bishara 
          Regional Director 
Tel:  972-2-9954816 /17/18/19 
Fax:  972-2-9954815 
 
Bank of Jordan 
P.O.Box 1829 
Ramallah, West Bank 
Contact:  Mr. Yahya Kadamani 
          Regional Director 
Tel:  972-2-9952694 /5/6/7/8 
      972-2-9958686 
Fax:  972-2-9958684 
 
Cairo Amman Bank 
P.O.Box 1870 
Ramallah, West Bank 
Contact:  Mr. Yousuf Bazian 
          Regional Director 
Tel:  972-2-9955435 /6 
      972-2-9985790 /91/92 
Fax:  972-2-9955437 
 
Commercial Bank of Palestine 
P.O.Box 1799 
Ramallah, West Bank 
Contact:  Mr. Khaled Al Gabeesh 
          Director 
Tel:  972-2-9954141 
Fax:  972-2-9953888 
      972-2-9954145 
 
Bank of Palestine 
P.O.Box 50 
Omar El-Mukhtar Street 
Gaza 
Contact:  Mr. Salem El-Shawa 
Tel:  972-7-823272/3/4/5/6/7 
Fax:  972-7-865667 
 
International Organizations 
 
UNSCO - United Nations Office of the Special Coordinator in the Occupied 
Territories 
(Office Headquarters in Gaza) 
Mailing Address: 
P.O. Box 490 
Government House 
East Jerusalem 91004 
Contact:  Mr. Terje Larson 
          Undersecretary General 
Tel:  972-2-829962/3  972-7-860074 
Fax:  972-2-829716 
 
UNDP - United Nations Development Programme 
Sheikh Jarah - East Jerusalem 
Contact:  Mr. Edward Wattez 
          Special Representative of the Administrator 
Tel:  972-2-810812  972-2-810822 
Fax:  972-2-810768 
 
UNRWA - United Nations Relief & Works Agency for Palestine 
Sheikh Jarah - East Jerusalem 
Contact:  Amb. April Glaspie 
          Coordinator of UNRWA Operations in West Bank & Gaza 
Tel:  972-2-890401 
Fax:  972-2-322714 
Contact:  Mr. Klaus Worm 
          Director 
          UNRWA - Gaza 
Tel:  972-7-822660 
Fax:  972-7-822327 
 
IBRD - International Bank for Reconstruction and Development 
P.O.Box 54842 
Jerusalem 
Contact:  Mr. Odin Knudsen 
          General Director 
Tel:  972-2-050-209767 
Fax:  972-2-823249 
 
U.S. Embassy and Consulate Personnel 
 
Commercial Section, U.S. Embassy 
Contact:  Mr. Barry Friedman, Commercial Counselor 
          Mr. Wajdi Odeh, Commercial Assistant 
Office Address: 
U.S. Commercial Service 
Migdalor Building 
1 Ben Yehuda St. 
Tel Aviv, Israel 63801 
Mailing Address: 
U.S. Embassy Tel Aviv 
PSC 98, Box 100 
APO, AE 09830 
Tel:  972-3-510-7212 
Fax:  972-3-510-7215 
 
Commercial Section, U.S. Consulate General 
Contact:  Mrs. Carol Abington 
U.S. Consulate 
18 Agron Road 
Jerusalem 94190 
Mailing Address: 
U.S. Consulate Jerusalem 
PSC 98, Box 100 
APO AE 09830 
Tel:  972-2-253288 
Fax:  972-2-259270 / 972-2-249462 
 
Economic Section, U.S. Embassy 
Contact:  Mr. Tain Tompkins 
          Economic Counselor 
71 Hayarkon St. 
Tel Aviv 63432 
Mailing Address: 
U.S. Embassy Tel Aviv 
PSC 98, Box 100 
APO AE 09830 
Tel:  972-3-5174338 
Fax:  972-3-663449 
 
Economic Section, U.S. Consulate Jerusalem 
Contact:  Mr. Paul Sutphin 
          Economic/Commercial Officer 
U.S. Consulate 
18 Agron Road 
Jerusalem 94190 
Mailing Address: 
U.S. Consulate Jerusalem 
PSC 98, Box 100 
APO AE 09830 
Tel:  972-2-253288 
Fax:  972-2-259270 
 
U.S. Agency for International Development (AID) 
Contact:  Mr. Chris Crowley 
          Mission Director 
U.S. Embassy 
71 Hayarkon St. 
Tel Aviv 63903 
Mailing Address: 
U.S. Embassy Tel Aviv 
APO AE 09830 
Tel:  972-3-525-5414 
Fax:  972-3-525-5549 
 
Agricultural Section, U.S. Embassy 
Contact:  Tully Friedgut 
          Agricultural Specialist 
71 Hayarkon St. 
Tel Aviv 63432 
Mailing Address: 
Office of Agricultural Affairs 
Unit 7228 
APO, AE 09830 
Tel:  972-3-517-4338 
Fax:  972-3-510-2565 
 
Agricultural Section, U.S. Embassy (Athens) 
Contact:  Mr. Paul Hoffman 
          Agricultural Counselor (Regional responsibility for  
            Israel, Greece & Cyprus). 
American Embassy 
91 Vasilissis 
10160 Athens, Greece 
Tel:  (30) 1-721-2951, 6431289 (Direct Line) 
Fax:  (30) 1-721-5264 
 
Washington-Based USG Personnel 
 
U.S. Department of Commerce 
Contact:  Mr. Paul J. Thanos 
          Israel Desk Officer 
U.S. Department of Commerce 
Room 2029B 
14th & Constitution Avenues, NW 
Washington DC 20230 
Tel:  202-482-1860 
Fax:  202-482-0878 
 
U.S. Department of State 
Contact:  Ms. Ann Bodine 
          Israel Desk Officer 
U.S. Department of State 
2201 C Street, NW 
Washington, DC 20520 
Tel:  202-647-3672 
Fax:  202-736-4461 
 
U.S. Agency for International Development (AID) 
Contact:  Ms. Diane Alleva 
          Business Advisor 
Room 100, SA-2 
Washington DC, 20523-02290 
Tel:  202-663-2662 
Fax:  202-663-267 
 
Contact: Ms. Dot Young 
         Country Officer 
New State Room #3214 
Washington D.C. 20523 
Tel:  202-647-2701 
      202-736-4921 
 
U.S. Department of Agriculture 
Contact:  Mr. Philip Letarte 
          Area Officer Southern Europe 
        Foreign Agricultural Affairs 
        Foreign Agricultural Service 
U.S. Department of Agriculture 
Room 5951S 
Washington, DC 20250-1000 
Tel:  202-720-7725 
Fax:  202-690-1149 
 
Contact:  Mr. Joseph Lopez 
          Asia, Africa and Eastern Europe Division 
        International Trade Policy Division 
        Foreign Agricultural Service 
U.S. Department of Agriculture 
Room 5503S 
Washington, DC 20250-1000 
Tel:  202-720-1483 
Fax:  202-690-1093 
 
Contact:  Ms. Suzanne Hale 
          Agricultural Director 
        Export Services Division, Foreign Agricultural Service (FAS) 
U.S. Department of Agriculture 
Room 4939S 
Washington, DC 20250-1000 
Tel:  202-720-6419 
Fax:  202-690-4374 
 
U.S. Trade & Development Agency 
Contact:  Mr. John Richter 
          Regional Director 
Department of Commerce, SA-16 
Room 309 
Washington, DC 20523 
Tel:  703-875-4357 
Fax:  703-875-4009 
 
Export-Import Bank of the United States (EXIM) 
Contact:  Mr. George Donegan 
811 Vermont Ave., NW 
Washington, DC 20571 
Tel:  202-566-4690 
 
Overseas Private Investment Corporation (OPIC) 
Contact:  Mr. Walter Jones or Mr. Abed Tarbush 
1100 New York Ave., NW 
Washington, DC 20527 
Tel:  202-336-8799 
Fax:  202-408-9859 
 
U.S.-Based Multiplier Organizations 
 
Builders for Peace 
Contact:  R. Joseph DeSutter 
          Executive Director 
1511 K St., NW, Suite 640 
Washington, DC 20005 
Tel:  202-628-0038 
Fax:  202-628-0048 
 
Eastern U.S. Agricultural and Food Export Council, Inc. 
Contact:  Mr. Roland L. Gaskill 
          Executive Director 
214 Senate Ave. Suite 600 
Camp Hill, PA 17011 
Tel:  717-731-6017 
Fax:  717-731-6019 
 
Mid-America International Agri-Trade Council 
Contact:  Mr. Drayton C. Mayers 
          Executive Director 
400 West Erie St. Suite 100 
Chicago, IL 60610 
 
Southern United States Trade Association 
Contact:  Mr. Scott Hanson 
          Executive Director 
World Trade Center, Suite 1540 
2 Canal Street 
New Orleans, LA 70130-1408 
 
Western U.S. Agricultural Trade Association 
Contact:  Dr. James Youde 
          Executive Director 
13101 N.E. Highway 99, Suite 200 
Vancouver, WA 98686-2786 
Tel:  206-574-2627 
Fax:  206-574-7083 
 
 
APPENDIX F: MARKET RESEARCH 
 
Not available. 
 
 
APPENDIX G: TRADE EVENT SCHEDULE 
 
Products for Development U.S.A. - March-May, 1996 
 
Product Categories 
 
Electrical Power Equipment 
Oil and Gas Field Equipment 
Safety and Security Equipment 
Agricultural Equipment and Chemicals 
Computers and Peripherals 
Food Processing and Packaging 
Telecommunication Equipment 
Water Resources Equipment and Supplies 
Machine Tools and Metal Working Equipment 
Medical Equipment 
Automotive Parts and Accessories 
Pollution Control Equipment 
Plastic Production and Machinery 
Textile Machinery and Equipment 
Transportation and Communications Equipment 
Construction Equipment and Supplies 
Avionics and Ground Support 
Education Equipment 
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