Israeli Pressure on Palestinian Economy Pushes West Bank to the Brink

Tamir Kalifa for The Washington Post
A vendor sells fried dough near an entrance to the Balata refugee camp on the outskirts of Nablus on Thursday.

NABLUS, West Bank – The signs of economic distress are everywhere in Nablus, a once-bustling hub of Palestinian commerce now paralyzed by Israel’s tightening grip on life and work in the West Bank.

School-age children sell candy for change and the upscale hotels and restaurants are closed. Jobless men smoke cigarettes on street corners, while taxis sit idle, their routes out of the city blocked by Israeli troops.

“The Palestinian people are used to crises,” said Iyad Kordi, general secretary of the Nablus Chamber of Commerce, but “what I see now, I’ve never witnessed.” This winter, local officials said hundreds of families reached out for the first time to plead for cash, food or basic heating.

“At least before, we had the basic needs of survival,” said Kordi, adding that the pressure Israel is putting on the West Bank is pushing it to the brink.

While Israel besieges and pummels Gaza, Palestinians here say it is also waging an economic war in the West Bank. Since the Hamas attacks on Oct. 7, Israel has imposed sweeping restrictions on the Palestinian economy, revoking work permits, hindering free movement and even withholding for months the tax revenue it collects for the Palestinian Authority.

The measures, which Israel says were taken for security reasons, have led to massive job losses, unpaid salaries and a steep drop in local production, according to the World Bank. They have also stoked fears of widespread unrest and worries that more young men, especially in the impoverished refugee camps, will join militant groups to take up arms against Israel.

“They are killing us economically,” said Jamal Tirawi, a local Fatah party leader in the Balata refugee camp in Nablus. Officials there say thousands of the camp’s roughly 33,000 residents were employed in Israel before the attack, mostly as construction workers.

Now, about 70 percent of workers there aren’t receiving a salary, compared with 35 percent who were unemployed five months ago, said Ahmed Thoukan, co-president of the camp’s popular services committee. Across the West Bank, unemployment reached 29 percent by the end of 2023, causing a sharp decline in the gross domestic product, according to the Palestinian Central Bureau of Statistics.

Lost income

Israel has long exercised significant control over the lives and movement of Palestinians here. It captured the West Bank from Jordan in 1967, ruling for decades through military occupation and constructing sprawling settlements for Israeli citizens.

In the 1990s, after the first Palestinian uprising, the Oslo accords granted the Palestinian Authority limited autonomy over civil affairs, including the economy, as a step toward peace. But that peace never materialized and Palestinians still rely heavily on Israel for jobs, market access, tax collection, and imports of raw materials and essential goods.

Over the years, Palestinian workers formed the backbone of Israel’s construction industry and became a reliable source of cheap labor for its booming agriculture and tourism sectors. Workers from Gaza and the West Bank could earn in Israel triple the amount they could make in the Palestinian territories, according to the World Bank.

But after Oct. 7, when Hamas and other militants killed about 1,200 people, authorities imposed a near-total ban on Palestinians working in Israel or its settlements in the West Bank. The government canceled the work permits of more than 170,000 Palestinian laborers, the World Bank said. Tens of thousands more who worked in Israel illegally are now also out of jobs, according to Shaher Sa’ed, general secretary of the Palestinian General Federation of Trade Unions.

Tamir Kalifa for The Washington Post
Abdullah Khezaran, 29, stands for a portrait near an entrance to the Balata refugee camp on Thursday.

“The issue of work permits for Palestinians is based on ongoing and comprehensive security considerations,” Ophir Falk, foreign policy adviser to Israeli Prime Minister Benjamin Netanyahu, said in a statement. “Israel is vigilant on this issue in order to prevent additional Palestinian terror.”

For Abdullah Khezaran, 29, the money he earned as a maintenance worker in Tel Aviv allowed him to get married and start a family. Now he’s unemployed and spends his days sleeping or playing cards, plagued by fears he won’t be able to support his wife and children.

At a Nablus roundabout, 53-year-old Taysir Dabeek sells parsley and lettuce. He used to make between $85 and $110 each day painting houses in Tel Aviv. Now he earns $15 a day to buy essentials for his family of six.

“God help us,” said Khezaran, who was standing on a nearby street corner.

Checkpoints and roadblocks

But even getting fresh produce or other goods, including from West Bank cities, is costly and cumbersome. The West Bank, which is slightly smaller than the state of Delaware, was already carved up by checkpoints and roadblocks, including a 450-mile-long barrier that snakes through Palestinian land.

Over the past five months, Israel has erected dozens of new military checkpoints and blocked towns and villages from accessing main roads, according to Israeli rights group B’Tselem. The worsening restrictions have stifled local trade and production, key pillars of the West Bank economy, and prevented another 67,000 Palestinians from physically returning to their workplaces, the World Bank said.

In Nablus, nestled in a valley in the upper part of the West Bank, Israeli forces have long maintained checkpoints at the city’s four exits. The military closed two of them in the fall, meaning no traffic could go in or out.

They also installed dozens of metal gates and dirt mounds to block roads around Nablus, Kordi said, cutting off routes to nearby villages. A spokeswoman for the Coordination of Government Activities in the Territories (COGAT), the Israeli government body charged with overseeing civilian policy in the West Bank, did not respond to requests for comment.

Drivers now get stuck for hours trying to leave the city. Students enrolled in university in Nablus, but who lived outside the city, are dropping out. Palestinian citizens of Israel used to travel to Nablus to shop or visit relatives. But now they’re staying home, keeping cash out of the local economy.

Nablus’s once-thriving furniture industry has all but collapsed because of the sheer difficulty of moving goods in and out of the West Bank. The Titi family faces the same problem with the sesame seeds it imports to make the popular condiment, tahini, which it sells from its chain of stores. Skyrocketing costs might force the family to close at least one of the shops, the family said.

If time passes and there is no relief, “the potential for an explosion gets bigger,” said Michael Milshtein, a former adviser to COGAT on Palestinian affairs.

Under pressure

The widespread loss of income is leading to desperation and rising social tensions, especially in the West Bank’s crowded refugee camps, where local leaders and residents say domestic disputes are becoming more frequent, and some parents are pulling their children from school to put them to work.

On a recent day, a woman wandered through Balata’s narrow alleyways, collecting aluminum cans to resell as scrap metal to support her four children. Volunteers at the local food kitchen said they’re preparing to serve double the number of families this year for the holy month of Ramadan, which begins Monday.

Young men in the camp “are under big pressure and unemployment is very high there,” the deputy mayor of Nablus, Hussam Shakhshir, said. But they don’t normally turn to criminality, he said, and instead “revolt against the occupation.”

Thoukan, the Balata camp official, said he’s already observed young men taking up arms after losing their jobs.

Abu Hussam, 28, used to earn about $100 a day working construction in Tel Aviv. But Israel canceled his work permit last year, after finding out about his brother’s militant activities.

Abu Hussam, who asked to be identified by his nickname for fear of retribution by authorities, said he couldn’t find work locally and ended up joining a local battalion of fighters.

Balata is a place that prizes armed resistance: Children wear miniature portraits of fallen militants around their necks, and ride bicycles, unfazed, as men with automatic rifles roar past on motorbikes. The walls of Abu Hussam’s living room are lined with posters of his dead comrades, killed in clashes with Israeli forces.

“Resistance is our right,” he said. But Abu Hussam also received regular cash handouts from a popular commander named Zoufi, who was killed by Israel in November.

“What do you expect them to do?” Amal Tirawi, director of the Balata’s women’s center, said of the workers who lost their jobs in Israel. “There are university graduates among the militants.”

But, she said, “No mother wants to see their sons killed or injured.”

Top: Tamir Kalifa for The Washington Post
Abu Hussam at his home in the Balata refugee camp.
Bottom: From left, Muna Abdallah, 43, Shifa Shilbayeh, 60, Samia Himo, 49, Amal Tirawi, 50, and Abeer Abu Halimeh, 29, who are involved with the women’s center at the Balata refugee camp on Thursday.