World Bank: PA faces $400m shortfall
The Palestinian Authority's fiscal position remains precarious. It is facing a $400 million financing gap for 2009, says a World Bank report for a conference being held today in New York.
"While PA performance in wage bill control has improved dramatically, overall expenditure control requires improvement - total expenditures in the first half of the year were 12 percent higher than the budget target," reads the report. "No amount of restraint will, however, be sufficient to address the unsustainable deficits generated by revenue shortfalls. For the PA to approach its deficit target, revenues must substantially increase in the second half of 2009."
World Monetary Fund forecasts indicate that for the first time in years the PA will report a positive GDP of about 5.5%, excluding the paralyzed Gazan economy. According to the World Bank, it is too early to conclude that the PA is enjoying viable economic growth.