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FEDERATION OF EURO-ASIAN STOCK EXCHANGES SEMI ANNUAL REPORT APRIL 2007
PALESTINE SECURITIES EXCHANGE
ECONOMIC AND POLITICAL DEVELOPMENTS
Political Developments
In the year 2006, the Palestinian arena
witness surprising developments when the
Palestinian political map changed radically at
the beginning of the year following the
legislative elections that led to the winning of
the opposition party. As a result, a financial
blockade was imposed on the Palestinian
government, leading to security tension from
time to time in various locations in the
country. The results of the elections came as
a surprise at both the local and international
levels. Since then, the political developments
have severe impacts on the Palestinian
economical situation.
Economic Developments
In the year 2006, the number of the
Palestinians exceeded ten million people;
four million of them live in the Gaza Strip and
the West Bank including Jerusalem.
From an economical prospective, statistics
at the end of the year 2006 shows that the
revenues of the Palestinian National Authority
during 2006 reached US$ 370 million in
comparison to US$ 1,290 million during 2005
with a drop of 71%. The main reason of this
severe drop is due to the Israeli government
stand which resulted in halting the
transference of the Palestinian taxes returns.
The donations received by the Palestinian
Authority during the first three quarters of
2006 reached US$ 550 million. They are
expected to reach US$ 760 million for the
whole year, that is, more than two folds of
the amount donated during 2005 when the
total sum of such donations reached
US$ 352 million.
During the third quarter of the year 2006, the
gross domestic product (GDP) in the
Palestinian territories deteriorated at a rate of
15.3% relative to the same period of last
year. In general, the rate of deterioration is
3.6% when comparing the first three quarters
of the year 2006 with the same period of the
year 2005.
During the third quarter of the year 2006, the
unemployment rate reached 24.2% that is a
rise of 5.7% and 6.7% in comparison with the
second quarter of 2006, and the third quarter
of 2005 respectively. At the end of the
second half of 2006, the number of poor
people in the Palestinian territories reached
2.1 million people while their number was 1.3
million at the end of the year 2005.
Impact Of The Economical Situation
On The PSE
At present, the Palestine Securities Exchange
(PSE) stands on a solid ground. Despite the
political and economical deteriorations, the
PSE was able to achieve outstanding results
in the year 2006 although they were less than
2005. Most of the Arab exchanges witnessed
deep correction movement following the
dramatic rises of stock prices in 2005 that
was not anticipated by most observers.
In 2006, the PSE held 238 trading sessions
were more than 150 thousand transactions
were executed with a value that exceeded
one billion US dollars. Despite the drop of
Al-Quds Index at a percentage of 46.39%,
all indicators show that at any positive
development in the political situation in
Palestine will be reflected immediately at the
economical circumstances and the PSE.
Key Information Contacts
Palestine Capital Market Authority: http://www.cma.gov.ps/
Ministry of Finance: http://www.mof.gov.ps/
Ministry of National Economy: http://www.met.gov.ps/DesktopDefault.aspx?lng=1
Palestinian Central bureau of statistics: http://www.pcbs.org/
Palestine Media center: http://www.palestine-pmc.com/link.asp
The Palestinian Legislative Council: http://www.pal-plc.org/english/english.asp
GROWTH OF INVESTMENT AND GDP
(%)
GDI
GDP
10
0
-10
-20
-30
-40
-50
-60
-70
-80
97
98 99 00 01 02 03
* World Bank reports
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