Israel Is Orchestrating an Economic Collapse in the West Bank
Job losses are only one factor in the equation driving its financial decline.
By Jessica Buxbaum, a Jerusalem-based journalist covering Israel’s occupation of Palestine and the Syrian Golan.
A view of the occupied West Bank village of al-Eizariya on Sept. 16. John Wessels/AFP via Getty Images
September 17, 2025, 12:01 AM
HEBRON, West Bank—Since the start of the Israel-Hamas war in October 2023, Rauf, a Palestinian construction worker from the West Bank, has only returned to his job in Israel once, in July 2024. After climbing over the Israeli-built wall separating the West Bank and Israel, Rauf was caught by Israeli police during a raid at his employer’s construction site and jailed for 38 days for entering without a permit. Now back in the West Bank, he’s banned from Israel until 2027.
Rauf, who didn’t want his last name used to protect his identity, had his permit revoked when Hamas attacked Israel on Oct. 7, 2023, as with the other approximately 115,000 Palestinians from the West Bank who also held work permits. Nearly two years into the war, only about 8,000 permits have been reinstated.
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“At the technical level, the Palestinian politic cannot do anything, except budget cuts and increasing revenue,” Abdelkarim said, emphasizing these methods have either already been employed by slashing salaries, or can’t be enforced, as with raising taxes on an increasingly impoverished population.
Therefore, the experts interviewed argue the only solution to Palestine’s persistent financial crisis is political: meaning ending Israeli occupation and establishing Palestinian sovereignty, as opposed to having a leadership intertwined with Israel’s economy.
“We can’t expect the Palestinian economy and the Palestinian people to regain at least part of their wealth, income, and capacity to spend, to live, at least decently, without the core political conditions,” Abdelkarim said. From his perspective, this means first ending the war in Gaza and allowing the movement of goods into the besieged enclave—and then negotiating a peaceful solution to end the decades of violence between Palestine and Israel.
For Rauf, and many other Palestinian workers like him, any solution, though, doesn’t seem on the horizon or even close.
“The situation seems hopeless and endless, especially with the current Israeli government. … I don’t see them allowing Palestinian workers back into Israel,” Rauf said. That sentiment rings true as Israel’s government is now implementing plans to replace Palestinian workers with hundreds of thousands of migrant laborers.
“Things aren’t going to change, and instead there is kind of a desperation,” Rauf said.
And that desperation could manifest in climbing a wall and risking arrest, just to earn your daily bread.
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