This article was originally published by the Inter Press Service and is republished with the author's permission.

Palestinians survey the site of a home demolished by Israeli bulldozers near Jerusalem. (Maan Images)

Over the last year, Palestinians have faced a siege that has taken its toll in every city across the West Bank and Gaza. It is not a siege of missiles and gunfire, but a calculated attack on the backbone of the entire occupied territories.

Through the Israeli, U.S. and European move to paralyse the precarious Palestinian economy over the last year, daily life has become a constant struggle for the ordinary Palestinian trying to put food on the table or run a business within a choking, round-the-clock military occupation.

The day after the swearing in of the duly-elected Hamas leadership in February 2006, Israel froze the release of tax revenues to the Palestinian Authority to the tune of 52 million dollars a month, as collective punishment against the millions of occupied Palestinians for electing the Hamas leadership.

In parallel attacks just months later, the United States and the European Union slapped economic sanctions against the entire population, under the conditions that Hamas "recognise" Israel's right to exist while "renouncing" violence.

Additionally, since February 2006, Israel has worked hard to pressure international aid organisations and donor countries to suspend aid projects in Palestine.

Financially sanctioning an occupied population is historically unprecedented, and has led to an irreparable trickle-down effect throughout the occupied territories.

Since the beginning of 2006, the poverty rate in the West Bank and Gaza has skyrocketed. In November 2006, the United Nations Relief Works Agencies published a report on poverty statistics, and concluded that the number of "deep poor" (Palestinian families unable to meet basic human consumption needs) increased 64.3 percent in the first half of 2006 alone. In the West Bank, the unemployment rate is now a staggering 60 percent.

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Over the last week, Israel moved to allow 100 million dollars (just over two months' worth of frozen tax revenues) back into the atrophied Palestinian economy. The transfer was approved in December but had been delayed until Israel could be assured that Hamas would not be involved in the handling of funds.

For most Palestinians on the streets of the West Bank, this slight release of funds may make it easier to support their families for a few more days, but the 100 million dollars is merely a drop in the bucket when poverty and unemployment rates continue to skyrocket for the 3.5 million people trapped inside the West Bank.

The severe impact of the economic sanctions spreads across all public and private sectors in the occupied West Bank.

Iyad, a public elementary school teacher, tells IPS that he has only been paid seven out of 12 months salary since the sanctions began. "Some teachers are having to take second or third jobs just to support their families; others are quitting their professions altogether."

When asked about the effect that these sanctions have had particularly on young students, Iyad says, "Some families are so poor that they couldn't afford to buy their children new schoolbags or uniforms. The children come to school depressed and angry. It is impossible for them to learn and for me to educate them in this environment."

Mahmoud, a lawyer with the Palestinian Authority's Civil Administration, tells IPS that crime is increasing across the occupied Palestinian territories as a direct result of the sanctions. "Organised crime is coming into the fold now in the West Bank. There is no functional court system. On top of that, the police on the streets are not receiving their full salaries, so they don't take their jobs seriously. It's like anarchy."

Khaled, a taxicab driver, tells IPS he was unemployed last year for more than six months. "It was very bad. I had to sell my car to the bank -- then I tried taking out a loan, but the interest was impossible to pay back since I had no employment."

In Bethlehem over the Christmas season, when a brisk tourism economy is traditionally anticipated, Khaled says that most of the tourists came and went in large, organised groups from Jerusalem or other cities inside Israel. They rented Israeli tour buses and did not stay in Bethlehem's hotels.

"The only business I seem to get is from a small number of foreigners who come to work specifically inside Bethlehem. A private taxi is too expensive for the local community. So our work suffers."

When asked if he thought the situation would improve after the slow release of withheld tax revenues, Khaled shook his head. "Our future is still the same. It's not getting better at all."