During the October conference, we also established an ad hoc liaison committee, with the World Bank as the secretariat, to coordinate international donor assistance to the Palestinians and avoid duplication. The Palestinians have a number of clear and immediate needs as they seek to start their operations in a range of areas. It is vital that they be equipped to move as efficiently as possible. A number of donors are helping in this area. This is not a traditional way of approaching development.
Donors prefer to target money to specific projects.
Excessive expansion of the government sector has traditionally been a problem in a number of developing countries, but in this case, more government is actually needed. The Johann Jurgen Holst Peace Fund coordinated by the Bank is a part of this effort. In order for the Palestinian economy to function smoothly and expand, the basic physical infrastructure must be in place. Financing projects in this area is a focus of both donors and the private sector. And infrastructure projects will be an important stimulant of economic activity and job creation as well.