Arab investors, led by Saudis, have signed a deal with the Palestinian Authority to develop a $200 million West Bank real estate project in the first such venture since recent peace moves, officials said.

Palestinian President Mahmoud Abbas said such deals by private Palestinian and GCC investors will help rejuvenate the ailing economy, reeling under tough Israeli constraints.

'We appreciate those investors who have come to invest in Palestine,' Abbas told investors and officials at the signing ceremony in Amman.

'If this illustrates anything it only shows the readiness of Arabs to help support the Palestinians,' he added. 'We believe peace and stability will draw more investments into Palestine and we see signs of more capital flows.' 

The Palestine Investment Fund (PIF), the investment arm of the PA, owns a fifty per cent stake with Riyadh-based The Land Company in the $50 million capitalised property firm set up to develop the multi-residential and commercial venture near the West Bank city of Ramallah.

The Land Company is a subsidiary of Saudi Arabia's Ahmad bin Sulaiman al Rajhi group. 

Said Bahjat Said, chairman of The Land Company, said construction will start in early 2008 as part of several multi-million dollar schemes the Saudi holding company was studying in Palestinian territories.

'We are not deterred by the difficult conditions and believe Palestine offers many attractive opportunities for investors,' Said said.
   
Abbas, backed by Western donors, is pinning hopes on accelerated peace moves with Israel to help improve the living conditions of Palestinians.