US$37 million in Grants to Support Palestinian Reforms and Human Capital

The first grant will support transparency, inclusion, and the green economy while the second will provide mental health services and employment opportunities 

WASHINGTON, June 7, 2022 –The World Bank approved today a US$30 million Development Policy Grant supporting reforms in the areas of transparency, inclusion, and the green economy in the Palestinian territories. In addition, US$7 million will be granted to provide selected social services, short-term cash for services, and online employment opportunities to the most vulnerable populations in Gaza. 

The World Bank’s financial support through a new development policy grant builds upon previous operations and supports a range of reforms to strengthen governance and transparency efforts,” said Kanthan Shankar, World Bank Country Director for West Bank and Gaza. “The grant will help ease some of the fiscal stress, while also focusing on strategic priorities in line with the World Bank Group’s Assistance Strategy for the West Bank and Gaza and the Palestinian National Development Plan for 2021-2023.”  

The new operation “Supporting Transparency, Inclusiveness and the Green Economy” Development Policy Grant (DPG) focuses on reforms to enhance public procurement practice and increase transparency. This, in turn, will promote stronger controls over spending and eventually create the fiscal space needed for productive investments and higher social spending. The DPG also supports the Palestinian Authority’s efforts to address the needs of vulnerable groups through reforms that enhance financial inclusion and that roll out gender responsive budgeting in key ministries.  

In line with the World Bank Group’s Climate Change Action Plan (CCAP), the operation focuses on strengthening the Palestinian territories’ adaptation and resilience to climate change shocks through reforms to improve governance in the water sector and amendments to the environment protection law to reduce greenhouse gas emissions. 

"The World Bank is also focused on the shortage of jobs, particularly for youth in Gaza following years of political instability and violence. Even before the COVID19 pandemic and the escalation of the 2021 conflict, only 16% of educated young people in Gaza - and 4% of young women - entered the labor market. Given the limited psychosocial support and mental health services in Gaza, the US$7 million grant will help create jobs in much-needed social services sectors, thus boosting human capital while helping young job seekers and their families lift themselves out of poverty,” added Shankar.   

The “Gaza Emergency Support for Social Services Project” responds to the immediate needs arising from the emergency in Gaza and builds on previous operations to provide mental health services, short-term cash for social services, and online employment opportunities. The project will be implemented by the NGO Development Center (NDC) which will select non-governmental organizations (NGOs) in Gaza with excellent track records to manage and scale up mental health and psychosocial services. The NDC will also subcontract service providers to deliver training and support needed for youth to find employment opportunities as online freelancers.  

Through the cash for services program, selected NGOs will target unemployed people with the ability to enhance the psychosocial support provision in Gaza to the most vulnerable communities, focusing on women and children. The e-work program will focus on empowering youth by targeting young people between the ages of 18-34 – half of whom are women – with a focus on those who have the skills or potential to become e-workers or online freelancers. A similar intervention under the Gaza Emergency Cash for Work and Self-Employment Support has shown this modality to be successful in providing employment opportunities for youth and especially women, with 80% of beneficiaries finding contracts totaling more than US$500,000.