Prime Minister Benjamin Netanyahu misses no opportunity to flaunt the flourishing of the Palestinian economy - in the West Bank, of course; not in Gaza.

During a sweaty and well-publicized visit he held last weekend at the Allenby Bridge crossing, Netanyahu boasted of the fact that economic growth in the West Bank had reached 7 percent.

At the cabinet meeting on Sunday the growth rate grew to double digits: 10 percent. Thus will be done to good Arabs who maintain Israel's security and don't launch Qassam rockets at the country.

Without the assistance, though, of the European and American taxpayer, who are paying the salaries of the Palestinian Authority's over 100,000 policemen and officials, the economy of the West Bank would long since have collapsed along with the PA.

July salaries, for example, have not been paid due to a delay in transferring $300 million from the donor nations.

The Palestinian economy is not recovering thanks to Israel, but in spite of it.

Although the Shin Bet security services and the Israel Defense Forces agreed to ease pressure on the population, most of the internal checkpoints that Defense Minister Ehud Barak ordered removed at the request of U.S. President Barack Obama administration, had already been slated for removal by former Prime Minister Ehud Olmert in response to pressure from former U.S. president George W. Bush.

In addition, according to the current report of the International Monetary Fund, Netanyahu was somewhat hasty in flaunting the success of his economic peace. The fund's headquarters in the territories predicted that 2009 would end with 7 percent growth (not 10 percent), a statistic that will, for the first time in three years, represent a substantial improvement in the standard of living.

However, the IMF says that if Israel does not continue to remove the restrictions on internal trade, the gross domestic product per capita will decline later in the year. Incidentally, according to the report the unemployment rate still stands at an extremely high 20 percent (less than Gaza's 34 percent).

The IMF points out that if Israel also removes the trade restrictions between its territory and the Palestinian territories, the rate of growth of the GDP per capita could even reach 8 percent.

To achieve that goal, it will not be enough to make an announcement to the press about the marvels of the Palestinian economy and to publish optimistic articles about the flourishing of nightclubs in Ramallah - most of whose customers are Palestinians with Israeli citizenship who don't receive friendly welcomes from security guards in Tel Aviv.

In order to earn a little credit for the rehabilitation of the West Bank, the prime minister would do well to listen to the stone and marble producers in Hebron and their Israeli partners.

Let him ask them what damage is being caused to the industry due to arbitrary and illogical decisions by the security officials in charge of the border crossings.

Teaching a new Knesset old tricks

The prime minister's political adviser Ron Dermer considers it urgent to silence the voice of non-governmental organizations like Breaking the Silence (an organization of veteran Israeli soldiers that collects testimonies from soldiers). It is so urgent that he forgot to do his homework.

Had he checked the Knesset records, Dermer would have discovered that he is not the first right-wing politician to think of the brilliant idea of banning the transfer of money from abroad to NGOs of a political nature.

The late MK Yuri Stern of Yisrael Beiteinu suggested an almost identical legislative initiative in the 16th Knesset.

The draft bill passed in the first reading and then disappeared into oblivion. During discussions it turned out that the law would require NGOs in Israel that receive donations from abroad to present the record of their economic activity to the Registrar of Non-Profit Organizations.

The representatives of Shas and United Torah Judaism immediately became the leading opponents of the initiative. Any attempt to connect that move to recent events in New Jersey is done at the reader's discretion.

Stern wanted to undermine the grants by European governments to NGOs representing the Arab minority in Israel and human rights organizations.

The treasury warned at the time that Europe could demand an end to all government funding of Israeli NGOs, including those involved in research and development and in providing grants to hospitals.

In addition, the grants given by these governments to the human rights organizations are nothing compared to the hundreds of millions of tax-exempt American dollars that charity organizations of American Jews and Christians pour into NGOs identified with the right.

A legal opinion presented to the MKs anticipated that the court would find it difficult not to recognize a tax exemption on donations as de-facto government funding. That was the end of the legislative initiative.

The Stern precedent is explained in a letter sent yesterday to Dermer by Gush Shalom, demanding that he put an end to the witch hunt of legal and legitimate groups such as Breaking the Silence.

"Such organizations make it difficult to justify a continuation of the existing situation in the occupied territories," wrote Gush Shalom spokesman Adam Keller, "but their blatant suppression directly harms the image of the State of Israel as the only democracy in the Middle East."

The attempt to silence Breaking the Silence and the preoccupation with donations to the NGOs has already attracted the attention of Jewish peace activists, the U.S. media and American right-wing organizations, which raise tax-free donations for the purpose of developing the settlements and for organizations like Elad (an organization advocating Jewish settlement in East Jerusalem), whose goals clearly contradict the interests of the Obama administration.

A leading European diplomat said he did not know whether to be angry or only astonished when he heard the claims of Israeli officials that "it is inconceivable" that the Israeli government would fund a human rights organization that levels criticism at a European government.

The diplomat mentioned that European assistance to human rights organizations in Israel is a drop in the bucket compared to money that Europe channels to the Palestinian Authority.

He is not aware of Israel donating 1 billion euros every year in order to assist with any conflict in Europe.