The Economic Pathway to Independence and Peace - Volume IV
The Economic Pathway to Independence and Peace
This publication is one volume in a series of four being published simultaneously by MAS, addressing the strategic economic implications for the State of Palestine of the aftermath of the Israeli war against the Gaza Strip and, indeed, all of Palestine. The conceptual framework of the series was designed during the first stage of Israeli aggression in early
2024, in close consultation with the Palestine Liberation Organization (PLO) Department of Economic Affairs, as a necessary set of in-depth original economic policy research to prepare for addressing post-war challenges and future Israeli-Palestinian economic relations. The Institute was fortunate that a research grant from the Arab Fund for Economic and Social Development enabled it to take on the task systematically.
Certainly, these four studies are predicated on an assumption of a “pathway to statehood” emerging from the ashes of the war on Gaza, as promised by the international community early on in this long trek, and to which it is still committed. That, in turn, assumes an Israeli partner willing to engage in a process of enabling Palestinian self-determination and sovereign statehood, a prospect that today, 30 years after Oslo, appears more distant than ever. The studies were prepared in the course of 2024 by a versatile team of Palestinian economists. Still, MAS, following closely the genocidal war, withheld publication until a moment when their political pertinence may be as evident and urgent to policymakers as the subject appeared to the authors to be, even while writing above an unknown future during the darkest moment of the genocide.
As these studies are being published, the war has raged on brutally for two years amidst mass starvation, killing, and pressures that risk ethnic cleansing, while the extremist Israeli government remains firmly in power, with impunity in the face of anemic international pushback. However, there have been, in mid-2025, important political developments that render these studies urgent reading for all those committed to ensuring the establishment of a sovereign and independent State of Palestine. In particular, the NY Declaration of July 2025 on the two-state solution was followed by a wave of recognitions of the State of Palestine by major world powers and countries, otherwise unable to stop Israel’s war. These countries appear to hope that such recognition will consolidate unprecedented global popular and official solidarity with Palestinian rights, as well as send a message to Israel that its policies have a political cost that cements in a new international consensus and frame of reference for any future peace process that might yet emerge.
The four studies are intrinsically linked by a logical sequence premised on the ultimate goal of establishing a Palestinian state in all of the Palestinian territories occupied since 1967, not in part of the land, nor in a way that separates the Gaza Strip, governance or economy-wise, from the rest of the State of Palestine. They also confirm that designing Palestine’s optimal economic relations with Israel, in their permanent shape, requires beginning with a 2-3 year “state inception phase” that brings partners back to some form of normal economic relations (Volume I). This would lead to an economic permanent status agreement that guarantees core Palestinian sovereign economic rights and the optimal economic relation with Israel, benefiting from previous experiences and numerous “day-after” economic plans since 1947 (Volume II). These are followed by a comprehensive investigation of the economic (theoretical and empirical) underpinnings and political governance of the monumental task of reunifying the fragmented Palestinian national economy (Volume III), and finally a study on principles, modalities, and comparative experiences in post-war reconstruction (Volume IV).
MAS is privileged to have been commissioned to deliver on this important task at such a crucial juncture in Palestinian history, which confirms that the economy of the State of Palestine is well conceived in Palestinians’ visions of their future ahead- we know what we want. It is from that basis that any future negotiations on state-formation processes, the reconstruction and governance of the devastated Gaza Strip, and national economic development strategies that restore the unity of the national economy should emerge.