West Bank and Gaza Country Climate and Development Report … – ReliefWeb

Executive summary

In the West Bank and Gaza, drivers of fragility, development constraints, and vulnerability to climate change are closely interconnected. For decades, the fragmentation of land, restrictions on the movement of people and goods, recurrent episodes of violent conflict, persistent political and policy uncertainty, and the lack of sovereign control over critical natural resources like water and land have hindered development and slowed economic growth. In parallel, unplanned urban development and weak service provision have increased the exposure of Palestinian households to climate risks while undermining their capacity to cope with shocks. In the West Bank and especially in Gaza, a chronic shortage of basic services, high levels of poverty, and widespread unemployment are exacerbated by the destruction and deterioration of critical infrastructure, leaving millions exposed to the severe and unpredictable effects of climate change.

Climate change is reducing the availability of water, food, and energy, inhibiting private-sector activity, undermining human capital formation, and diminishing economic opportunities, yet the Palestinian Authority (PA) has very few policy tools to address these challenges. Model projections show that water scarcity will be more prevalent in Gaza, while flood risk will rise fastest in the eastern part of the West Bank. Increased rainfall variability, rising sea levels, and saltwater intrusion will negatively affect aquifers and groundwater quality in Gaza. Both in the West Bank and Gaza, poverty rates tend to be highest in the areas most susceptible to climate shocks and stresses. Cities are also highly exposed to climate change given their large populations and densely concentrated physical assets. As the Palestinian population is growing by about 3.4 percent each year, the need for water and energy will continue to increase, leaving the West Bank and Gaza ever more dependent on Israel to provide basic services. Population growth will also intensify pressures on public services, natural resources, and urban housing, with negative implications for human development. Because many Palestinian firms rely heavily on water, decreased water availability poses an especially serious risk to employment and growth.

The borderless nature of climate change highlights the intertwined destinies of the Palestinians and Israelis. Left unaddressed or tackled only by one side, the negative impacts of climate change will spill across borders and impacts on both Palestinian and Israeli lives and livelihood. Climate-change induced water scarcity could intensify competition over shared resources and exacerbate cross-border tensions. Diminished access to water will also undercut economic returns in many sectors of the Palestinian economy, potentially exacerbating unemployment, increasing dependence on Israel for livelihoods, and weakening social and economic resilience. The lack of adequate wastewater treatment systems on the Palestinian side is already affecting the environment on both sides of the border, and its impact will intensify as water use increases. Restrictions imposed by the Government of Israel (GoI) (1) significantly limit the policy instruments and public investment opportunities available to the PA to address climate challenges. However, it tackled jointly, the positive impact of climate action can accrue to both people.

This Country Climate and Development Report (CCDR) for the West Bank and Gaza examines the social and macroeconomic impacts of climate change under three alternative scenarios that reflect different levels of climate action and divergent economic growth trajectories. The scenario analysis builds on sector-level assessments focused on the water-energy-food nexus, urban development, and the macroeconomic framework and is informed by extensive stakeholder consultations and the stated climate priorities of the PA. The health and social-protection sectors are treated as cross-cutting factors in this analysis, reflecting the critical importance of service provision and human capital in a fragile context like the West Bank and Gaza. The three CCDR scenarios are:

• “Continued Fragility”: This scenario presents the most pessimistic case, in which the inaction of all parties increases the social and economic costs of climate change while exacerbating its impact on existing drivers of fragility. The scenario is marked by (i) elevated levels of water insecurity, (ii) diminished access to basic services, especially in Gaza, (iii) increased exposure to extreme weather events and other disasters, and (iv) persistently weak economic growth.
• “Increased Resilience”: This scenario assumes continued GoI restrictions related to the occupation but also optimized climate action by the PA in line with the updated Nationally Determined Contribution (NDC) for the West Bank and Gaza. The selection of specific climate policies and infrastructure investment actions is based on their potential to address urgent development needs and promote resilience to protect human capital and infrastructure, maintain the provision of basic services, and enhance urban livelihoods.
• “Toward Sustainability”: This scenario highlights the potential to unlock growth and expand opportunities for climate action by (i) removing GoI-imposed restrictions on access to water, energy, land, and other natural resources, and (ii) expanding access to finance, including via increasing the PA’s own-source revenue.

The outcomes of these three scenarios should not be interpreted as economic forecasts but rather as representations of potential development paths. The scenarios include numerous assumptions related to climate risk, policy measures, access to finance, economic growth, and the geopolitical context. Nevertheless, the risks highlighted by the “Continued Fragility” scenario demonstrate the urgent need for action by both the Palestinians and the Israelis. On their own, the Palestinians can build “Increased Resilience” to climate change. However, only if the GoI eases constraints on Palestinian access to resources and alleviates key drivers of fragility will the West Bank and Gaza be able to move “Toward Sustainability”.

(1) According to the GoI, these restrictions are for the purpose of enhancing the security of Israel and Israeli citizens.