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Con res ~onaI Research Service
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                                                                                                Updated  May  24, 2023

The Palestinians: Overview, Aid, and U.S. Policy Issues


The Palestinians are an Arab people whose origins are in
present-day Israel, the West Bank, and Gaza. Their ongoing
disputes and interactions with Israel raise significant issues
for U.S. policy (see U.S. Policy Issues and Aid below).
After a serious rupture in U.S.-Palestinian relations during
the Trump  Administration, the Biden Administration
reengaged  with the Palestinian people and their leaders in
the West Bank-based  Palestinian Authority (PA), and
resumed  aid-with  hopes of preserving the viability of a
negotiated two-state solution. The Palestinians aspire to an
independent state with East Jerusalem as its capital.
Near-term prospects for diplomatic progress toward Israeli-
Palestinian peace reportedly remain dim. Palestinian leaders
lamented some  Arab states' normalization of relations with
Israel near the end of the Trump Administration because it
could undermine  past Arab efforts to link such
improvements  with addressing Palestinian negotiating
demands.  Domestic political uncertainty among both
Palestinians and Israelis also presents challenges to a return
to Israeli-Palestinian talks.
Palestinian domestic politics are dominated by two factions.
Fatah, an Arab nationalist faction, is the driving force
within the Palestine Liberation Organization (PLO), which
represents Palestinians internationally. The Sunni Islamist
group Hamas   (a U.S.-designated terrorist organization) has
not accepted PLO  recognition of Israel and constitutes the
main opposition to Fatah. Since 2007, the United States and
other Western countries have generally sought to bolster the
Fatah-led PA vis-a-vis Hamas.


Source: Economist Intelligence Unit.
Note: West Bank and Gaza Strip borders remain subject to Israeli-
Palestinian negotiation.
Of the approximately 13.4 million Palestinians worldwide,
about 5.1 million (98% Sunni Muslim,  1% Christian) live in


the West Bank  and Gaza. About  1.6 million additional
Palestinians are citizens of Israel, and about 6.7 million
more  live elsewhere. Of the total Palestinian population,
more  than 5.7 million (roughly 43%) are refugees
(registered in the West Bank, Gaza, Jordan, Lebanon, and
Syria) whose claims to land in present-day Israel constitute
a major issue of Israeli-Palestinian dispute. The U.N. Relief
and Works  Agency  for Palestine Refugees in the Near East
(UNRWA)-funded mostly by voluntary contributions
from the United States and other countries-is mandated by
the U.N. General Assembly  to provide protection and
essential services to these registered Palestinian refugees,
including health care, education, and housing assistance.
International attention to the Palestinians' situation
increased after Israel's military gained control over the
West  Bank and Gaza  in the 1967 Arab-Israeli war. Direct
U.S. engagement  with Palestinians in the West Bank and
Gaza  dates from the establishment of the PA in 1994. Since
the 2010s, other regional political and security issues have
taken some of the global attention from Palestinian issues.
Reduced  international focus on the Palestinians may affect
their economy, which faces political risk challenges related
to unrest and violence, as well as considerable Israeli
movement,  access, and land use restrictions. According to
the World Bank,  external aid to the PA declined from 27%
of gross domestic product (GDP) in 2008 to just under 2%
in 2022, contributing to large fiscal deficits that endanger
the economy's  sustainability. The World Bank estimated
end-2022  unemployment   as 45% in Gaza and 13%  in the
West  Bank. Price hikes connected to the Russia-Ukraine
war, including on grain, affect Palestinians alongside others
in the region.
Timeline   of Key Events  Since  1993
1993-1995         Israel and the PLO mutually recognize each
                  other and establish the PA, which has limited
                  self-rule (subject to overall Israeli control) in
                  the Gaza Strip and specified areas of the
                  West Bank.


2000-2005




2004-2005


2005



2006


Second Palestinian intifada affects prospects
for Israeli-Palestinian peace, leads to
tightened Israeli security in the West Bank,
and complicates the U.S. third-party role.
PLO  Chairman/PA President Yasser Arafat
dies; Mahmoud Abbas succeeds him.
Israel unilaterally disengages from Gaza, but
remains in control of airspace and
land/maritime access points.
Hamas wins majority in Palestinian Legislative
Council and leads new PA cabinet; Israel,
United States, and European Union confine
relations to PA President Abbas.

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