The performance of palestinian foreign trade : from prolonged imposed integration to the Israeli economy to a window towards the rest of the world (1968-1998)

Abugamea, Gaber Hussain
Over the past three decades the Palestinian territories (PTs) trade experienced numerous shocks and instabilities following the occupation of the area by Israel in 1967 war. As a result of this situation, a forced customs union affected the area trade till 1993. Afterwards, the transitional Oslo peace agreement between the Palestinian Liberation Organization (PLO) and Israel resulted in a slight window, which permits PTs to import, to some extent, from the rest of the world. In view of these considerations, this thesis tries to evaluate the performance of Palestinian external merchandise trade by investigating the response of trade to its main determinants during the 1968-1998 period. It seeks a quantitative evaluation of the role of domestic demand, foreign demand and real effective exchange rates of both regional trade partners and the rest of the world, as main determinants of the performance of Palestinian trade. It also assesses the competitiveness of Palestinian mexternal trade regionally and globally. Moreover, by comparing this performance with its counterparts in a selected group of neighboring countries, it highlights the deficiencies of Palestinian trade sector. Finally, it tries to draw the main policy implications, which would lead to a better performance of trade in future. Chapter Two gives an overview of the Palestinian economy since 1967, with particular emphasis on the impact of regional economic relations, shocks and patterns of growth on trade. Chapter Three discusses trade features: trade development, direction, composition and competitiveness over time. Furthermore, it evaluates the impact of all the trade agreements signed since Oslo accord. Chapter Four models trade ratio and both exports and imports and examines the stability of area trade. The core of this chapter uses time series econometrics tools to investigate long-run relations for trade equations, investigates short-run dynamic adjustment and produces forecasts. Chapter Five compares the performance of Palestinian trade with selected neighboring Arabian countries by using a specific export supply modeling and panel data analysis. Mainly, it highlights the influencing factors resulting in the deficient performance of area's trade. Lastly, Chapter Six discusses results and detects policy implications from the previous chapters.


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Citation Formats
G. H. Abugamea, “The performance of palestinian foreign trade : from prolonged imposed integration to the Israeli economy to a window towards the rest of the world (1968-1998),” Ph.D. - Doctoral Program, Middle East Technical University, 2003.