Economy Challenges in East Jerusalem

The economy in East Jerusalem has been steadily diminishing, creating a host of impediments for Palestinian Jerusalemites. The unemployment rate is high on an unprecedented scale and 62 % live in a condition of extreme overcrowding. We have been rising to the economic challenges, aiming at providing employment opportunities, solving housing problems, and reviving the economy of East Jerusalem.

  • The economic losses in East Jerusalem reached 10 billion dollars in the last decade

The contribution of East Jerusalem to the Gross Domestic Product (GPD):

  • 15% before 2000
  • 8% after 2000
  • Only 10% of the municipal budget is allocated to East Jerusalem

In addition to the initiatives supporting local economy being discouraged, the many different types of taxes that Palestinian Jerusalemites have to pay make trading complicated with very narrow profit margins, discouraging investments

  • Income Taxes
  • VAT is 17% of the sales value
  • Labor Taxes
  • National Insurance Taxes
  • License Taxes
  • Tourism
  • The number of hotels fell from 34 to 21 in 2016
  • A lot of hotels had turned into offices due to the high taxes
  • The number of guests staying in East Jerusalem hotels plummeted in 2016: from 48% to 23%
  • Manufacturing and Craft
  • There are only 12 craft facilities in East Jerusalem hiring no more than 103 employees; 63% of which work in embroidery
  • With the services sector taking over by representing 53% total gross value added to economic activities, the Manufacturing sector has shown dramatic regression.

The Labor Market

  • In 2015, the percentage of contribution of the 15+ labor force was 29.2%
  • The percentage of employed women contributing to the labor market is 6.3%, one of the lowest in the world
  • Unemployment rate reached an alarming percentage of 13.9% in 2015 and continues to increase
  • 6% of the labor force are wage workers

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