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The interviewees had a split view on the role of International support in the ICT sector in Palestine. Some saw the international support as a unique opportunity and as an enabling factor to help establish new firms, or even help existing firms to get funds at a critical stage. Others pointed to some of the risks associated with the dependency on foreign aid in terms of sustainability, and the possible market distortion based on the potential conflict of focus between the international aid goals and other local stakeholders.

One interviewee, the founder of a startup company funded by international aid, indicated that the availability of international fund motivated some companies owned by Palestinians abroad to move to Palestine to make use of the funds:

“In Palestine there is a lot of money and at a certain period people were saying that there is more offer than demand so it is an opportunity and I have seen Palestinians who have companies

outside of Palestine because of this movement they moved most of its operation to Palestine to make sure they become capable of receiving this kind of investments. “Interviewee 5: entrepreneur

However, interviewees did not agree on a positive effect of international aid money; it is perceived by some as “political money” that needs to be replaced on the long run by internal unconditional funding.

“I am really working very hard to make breakthroughs to have unconditional funds with no political money which is very hard to find in Palestine. USAID money is political money; European money is definitely political money so what I am trying to do is to convince Palestinian philanthropies to start taking their social responsibility and funding this process and to invest to reach beta level.” Interviewee 2: NGO founder

One of the problems that arise from dependence on International aid money is the uncertainty associated with the volatile nature of such funds:

“we cannot build an economy based on donations because the Congress can vote to stop the aid any minute, so we need to build our own economy.” Interviewee 7 Outsourcing Company founder

One consequence of this vitality is the difficulty of making long-term plans based on a future budget:

“The problem is that we don’t have a status quo, we are not protecting the current situation, every day we are going down, every day we have reduction in something even when you are designing the government budget on this amount of money, the other day there will be a political decision like the speech of The Palestinian president or other and the Americans cut 45%

of the budget. So you have to deal with the new reality. All the time you have changes, you do not have stability so how can you have a long-term planning “. Interviewee 2: NGO founder

An interviewee also pointed out the problem of sustainability of companies that depend initially on international aid and support:

“So in a certain period there were a lot of funds and NGOs that help companies in the outsourcing sector and encourage foreign companies to do outsourcing deals with local companies but as soon as this help starts to wither you can see that the cooperation also starts to shrink because of the cost. “Interviewee 5: Entrepreneur

“we cannot depend on the USAID to build these companies because this is not sustainable. The time the project is ending, the funding is not there, and the company will fail if they do not have the access to the right market which is not only in Palestine but outside.” Interviewee 10: Academic

One problem with the dependence on international aid is that it creates some “laziness” and incompetence in raising internal for funds projects,

“donors have become more stringent in how much funds they give and how funds are dispersed. We find ourselves with higher education institutions which are for the first time in their life thinking of creating advancement and fundraising departments, they became very lazy during the first 20 or 30 years of their existence with hands out that they actually have not established advancement departments so from a financing perspective there is a weakness “Interviewee 6: entrepreneur

“I think that one of the problems that we have in Palestine is all the NGOs, they encourage people to have their hands out, and we need to stop that.” Interviewee 7: outsourcing company founder.”

International support usually comes with many restrictions and rules; donors may have their own vision and target that is not necessarily in line with the that of other stakeholders in the ICT sector. therefore, donation money may be limited in nature:

“Maybe there is a certain fear from investing in this sector. The problem in Palestine is that any kind of initiative comes from a donor and this is not a good way to start an industry because donors have a specific target, they are limited. For example, there were many projects done on incubators but they did not have a big success, it comes from donors who put rules and money is not really good spent there. So you need an investor who wants to make money and believe in investing in the ICT and you need people who can build such an industry, who have the skill, the willingness and the expertise. “Interviewee 3: academic

Finally, the restricted nature of international aid may distort the market by concentrating on specific projects; an interviewee noted that the international aid might push the companies towards a “wrong direction” as an interviewee puts it:

“There is some market distortion happening: long assistance given to companies that pushes them to the wrong direction. This happened because of some donors but now it is changing. Every couple of years they coordinate the activities and projects in order to avoid the market distortion which is happening sometimes. There is some information about that in World Bank reports that talk about this.” Interviewee 3: academic

In conclusion, many interviewees see some value and opportunity in international aid, however many agree that it cannot be the main vehicle to the ICT sector development because of its restricted nature, and that it should be replaced by other sources of funding that are either motivated by profit or by government funding for start-up companies in line with the national goals.