WHY withholding 'AID' to Hamas is bad for Israel
Foreign governments and Israel, which provide about 60 percent of the authority's budget, are [still] threatening to cut off funding unless Hamas accepts the principle of peace with Israel.Earlier, I outlined why Palestinians find themselves in this economically compromised position. But, there is another dynamic to consider. Apparently, Israelis need Palestinians, too.
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International aid covered about $340 million of the deficit and bank loans the rest, the World Bank said.
Taxes that Israel collects on Palestinian goods passing through Israeli ports and from workers employed in Israel add about $53 million a month to the budget on average, the Finance Ministry said. [So, it's Palestinian earned income that their withholding]
Israel suspended the latest payment, due to be made two days ago.
Israeli exports to the West Bank and Gaza amounted to $1.6 billion last year, making it the country's second-biggest market after the U.S., according to the Federation of Israeli Chambers of Commerce.This raises some important questions. How vital is $1.6 billion in revenue to Israel?
[Isreal engaged in] approximately $20 billion in two-way trade with the United States in 2004 . . .U.S. exports to Israel totaled $6.1 billion in 2004.This means that Israeli exports to the US amounted to almost $14 billion! So, the US trade deficit can't be blamed on China alone! Not bad for a country about the size of New Jersey.
So, $1.6 billion in revenue from Palestinians is not a vital chunk of revenue, but neither is it insignificant.
Then there's the question of why the US and Palestine are Israel's biggest export markets.
- Israel ranked 3rd in the world for U.S. patents per capita, following Japan and Taiwan.
- Israel's commercial relationship with the United States has developed rapidly since the signing the Free Trade Area Agreement (FTAA) in 1985.
- Since 1995, nearly all tariffs on trade between U.S.-Israel have been eliminated
- The business environment and style [in Israel] will seem familiar to Americans, but personal relationships sometimes play a relatively larger role.
Israel controls movement inside the West Bank and all access in and out of Gaza, except for one overland crossing into Egypt.Because they have no other choice. Pretty effective strategy: occupy, control, and finance the occupation through extortion. So much for the only democracy in the Middle East.
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Israel has completely severed Palestine from its surrounding milieu—the countries with which it has historically interacted—and from its logical trade partners.