Signs of growth in the Israeli tourism industry may be related to a period of relative stability between Israelis and Palestinians. According to the Israeli Ministry of Tourism, 25% more tourists visited the country during the first three months of 2005 than during the same period last year. Tourism has also increased in the Palestinian territories, but to a lesser degree than in Israel.

According to the Los Angeles Times, one notable effect of recent stability has been a resurgence in mid- and high-priced tourism packages to Israel. Business for some Israeli- and Palestinian-owned hotels in Jerusalem has increased as much as twofold since last year.

Yosuf Daher, director of the Arab Hotel Association, says Palestinian-owned tourist businesses grew in Jerusalem and Bethlehem, but stagnated in Nablus. To fortify the industry, he says, “We need freedom of movement for tourists into Palestinian areas. We need the calm to continue and more political developments. It is vital that the two sides keep talking.” (Guardian UK, May 3)

A Rand Corporation study released in late April recommends development of a “much-needed tourism industry” as one step toward a successful Palestinian state. According to the study, a transportation corridor, preserved historic city centers and a national park system would help support tourism.

Some commentators from peace-promoting NGOs have drawn parallels with past regions of conflict, such as Croatia, where peaceful times drew tourists, creating prosperity that had overall stabilizing effects.