A World Bank report released this week says that the economy of the Israeli-occupied Palestinian territory is “too poor” to allow the creation of an independent state there.

The report contradicts an assessment made by the International Monetary Fund (IMF) that the Palestinian National Authority (PNA) had created a “strong banking system” and was economically ready for statehood.

In effect, the World Bank report suggests that the poverty fuelled by the Israeli occupation of the Palestinian territory since 1967 is a justification for the continuation of that occupation.

The report concludes that the Palestinians do not have enough foreign trade, saying “manufacturing and agriculture have dropped significantly” in recent years and that the only growth industry is the foreign-subsidised PNA.

It did mention Israeli restrictions on commerce, but only briefly. Still, this was enough for Israeli officials to shoot off an angry retort that the constraints on the Palestinian economy are based on “vital security needs” of the occupation force.

No one needs to be told that Israel never wanted the Palestinian economy to be strong enough to stand on its own. Israel allowed Palestinian engagement in commerce only to the point that it served the Israeli interest of checking the Palestinians’ resistance to its occupation of the West Bank, including Arab East Jersualem, and the Gaza Strip.

Israel also kept the territories as a captive market for its exports and is maintaining a tight blockade of the Gaza Strip. It allows a minimal number of Palestinians to work within the 1967 Green Line. Israeli restrictions have brought Palestinian exports to all but a standstill.

Against such odds, there is little chance of the Palestinian economy growing on its own.

The Palestinian economy did improve in recent years but only as a result of foreign aid.

The World Bank report says such aid has led to 7.7 per cent gross domestic product growth between 2007 and 2011.

However, the growth is is unsustainable. Whatever growth has been posted is in government services, real estate and other non-tradable sectors. The manufacturing and agriculture sectors have dropped significantly.

The World Bank affirms that Israeli restrictions remain the biggest impediment to investing, creating high uncertainty and risk.

All these put together, it makes an argument against the creation of an independent state.

However, economic feasibility has never been the decisive factor in creation of independent countries.

In the case of Palestinians, it has been proven outside the occupied territories that they are enterprising businessmen when they are given a free hand.

If there is an economic impediment to the creation of an independent Palestinian state, then that is a direct result of the Israeli occupation of the land. End the occupation and the Palestinians are capable of creating a sound and strong economy of their own. It will not come overnight, but it can be done.

Therefore, no one should seize the World Bank report as a tool to be used to argue against the creation of an independent Palestinian state.