West Bank and Gaza - Improving Governance and Reducing Corruption

In the past decade, the Palestinian
Authority (PA) has worked to strengthen economic governance
and combat corruption, both essential to sustained economic
growth and improved delivery of public services. This report
finds the PA has made significant progress in its public
institutions, establishing a strong governance environment
in many critical areas. But it also identifies areas where
reforms are underway but incomplete or, in some areas, not
yet under consideration. Major reforms have been put in
place to strengthen the PA's public financial
management (PFM) systems and better manage its equity
holdings, two crucial components in the public finance
sector. In other important areas, such as public
procurement, public sector employment, regulation of the
private sector, and the work of anti-corruption
institutions, reforms are underway but have not been fully
implemented. This analysis relies on an understanding of the
relationship between good economic governance, public
service delivery, and corruption. Studies show a direct
correlation between weak governance systems and the quality
of public service delivery. Weak governance systems, in
turn, provide an opportunity for corruption. The report does
not attempt to investigate specific corruption activities or
quantify the economic costs of corruption in West Bank and
Gaza. Its purpose is to provide a comprehensive look at the
current state of economic governance in the PA. It is the
first report to comprehensively assess governance reforms,
ascertain citizens' and officials' actual
experiences with corruption in the delivery of public
services, identify institutional strengths, and highlight
systematic governance weaknesses which could lead to corruption.