This Economic Cluster Report (ECR) provides a situation analysis and needs assessment of the EJ economy. It is one of three complementary cluster reports. The first discusses human rights and the institutional setup, and the second one covers the social sector. The three reports represent the background work for the preparation of the Short- and Medium-Term Sectoral Development Agenda for EJ (SMSDA-EJ), which aims at responding to Jerusalemites’ developmental needs, combating the Israeli Occupying Authority’s (IOA) plans of Judaization, fostering the steadfastness of the EJ population, and safeguarding the Arab Palestinian identity of the city. The purpose of the ECR is to identify the main challenges and impediments which hamper EJ’s economic growth, jobs creation, and competitiveness. Economic growth and job creation are essential for the steadfastness of EJ’s population and for combating the IOA plans to evict East Jerusalemites out of their city by using different methods of pressure and coercion.