Palestinian Economy Support

The Palestinian economy is poised for rapid growth if Israel eases stifling restrictions and investors ready to take risks could reap big profits, the World Bank and Palestinian officials said on Thursday.

Palestinian entrepreneurs are hoping such foreign investors, many from Gulf countries awash with oil wealth, will stump up $2 billion at an investment conference in Bethlehem this week to support local business plans, from tourism to technology.

Palestinian Prime Minister Salam Fayyad, who was appointed last year after President Mahmoud Abbas dismissed Hamas Islamists from government in a move that ended trade sanctions, said "an investment in Palestine is an investment in peace".

The investment drive is part of efforts backed by Middle East envoy Tony Blair to invigorate the moribund Palestinian economy as Abbas pursues U.S.-backed peace talks with Israel.

The United States has been pressing Israel to remove some of the hundreds of roadblocks and checkpoints in the occupied West Bank but with little success. A U.N. survey has found that only 44 of the 61 obstacles it had agreed to remove had been scrapped -- and that most of these were of little or no significance.

Daboub said Israel must unravel its network of checkpoints and roadblocks, which the Jewish state says are needed for security but which the Palestinians call collective punishment -- for the economy to flourish.

He said, however, that Palestinians were still well placed to attract investment, noting they ranked 22nd in the world for business-friendly tax policies and 33rd in terms of a solid legal framework to protect investors.