West Bank's Palestinian Tech Sector

Overview

The Palestinian tech industry in the West Bank has contributed to the development of the Palestinian economy over the last decade.  In 2022, the sector contributed 3.1% to GDP, which is equivalent to $482 million, and employed around 9,558 professionals in 450 companies.  Currently, more than 8,000 students are enrolled in ICT and there are over 2,500 yearly graduates from 13 Palestinian universities.  Female participation in the sector is estimated at 27% and increasing yearly due to the many initiatives that promote education in STEM and digital education.

Tech Services Sector

The services sector in the West Bank is the largest employer and contributor to GDP, which accounts for more than one third of the labor market.  In the tech sector, many Palestinian ICT companies provide back-office support, software development, and R&D services to Israeli, regional, and international companies.  Some Palestinian companies even depend solely on their international clients. Highly skilled and educated Palestinian software developers serve as an economic bridge between Palestinian and Israeli ICT companies since those services are usually unhindered by movement restrictions between the West Bank and Israel.

Startups

Although the Palestinian tech sector is small, tech startups have been growing over the last decade by innovative, creative, and entrepreneurial Palestinians. Around 200 tech startups in the West Bank receive support from innovation hubs, incubators, and accelerators. Some of the challenges that startups face in launching a new company are the limited access to early-stage capital, limited international connections, the lack of mentorship and guidance, and the difficulty in travelling outside the West Bank. Despite these challenges, good opportunities exist for establishing joint ventures and partnerships between Palestinian startups and U.S. companies, in addition to assisting the former in opening offices in the United States.    

E-Commerce

Given the existence of a good telecommunication infrastructure, an established banking system, and advanced IT applications that guarantee internet security, the E-Commerce market in the West Bank has significant growth potential. Around 94% of Palestinian households in the West Bank have home internet access. Most Palestinians use the internet for knowledge, research, studying, social media, business-to-business activities, and entertainment. According to a report published in 2023 by the Palestinian Central Bureau of Statistics, 17.5% of internet users in the West Bank, aged 18 and above, purchased goods and services online, which included clothes, shoes, sportswear and accessories, cosmetics, and ICT services. With the increased E-Commerce global trend, more Palestinians are purchasing goods and services online. U.S. companies with E-Commerce solutions have good prospects to enhance the E-Commerce market in the West Bank.  

For more information on the Palestinian tech sector, please contact Assad Barsoum directly at Assad.Barsoum@trade.gov or visit the U.S. Commercial West Bank website.