ABSTRACT
The territories' foreign trade in the post-war period has been reoriented as a result of several Israeli measures adopted to increase their economic links with Israel, making it in a few years their major trading partner. Trade deficit in the territories was compensated by tourism earnings, remittances, transfer payments by United Nations Relief and Works Agency and other foreign agencies, and, in the case of the West Bank, by excess government demand. Risk capital has been moving out of the Gaza Strip in the past several years, a fact that might point to the narrowing range of investment opportunities in its economy. Capital movement into the territories has taken various forms: visitors' spending, settlement of the export surplus, Jordanian payment of salaries for 6,000 former civil servants and teachers and payment of the rent on public buildings in the West Bank, Jordanian grants and loans to local authorities, and remittances.
