Ramallah: The Palestinian self-rule government is close to being "completely incapacitated," largely because Arab countries haven`t delivered hundreds of millions of dollars in promised aid, the Palestinian prime minister said in an interview today.
If allowed to continue, the Palestinian Authority`s unprecedented financial crisis will quickly double the number of Palestinian poor to 50 per cent of a population of roughly 4 million, Salam Fayyad said.
Fayyad said the malaise is further boosting the political appeal of the Islamic militant Hamas while discrediting him and other proponents of a nonviolent path to statehood in the West Bank, Gaza Strip and east Jerusalem. Hamas seized Gaza from Fayyad`s boss, Palestinian President Mahmoud Abbas, in a 2007 takeover, leaving Abbas with only the West Bank.]
The failure of the West Bank-based Palestinian Authority to deliver on many of its promises, coupled with recent Israeli concessions to Hamas, "has produced a reality of a doctrinal win for what Hamas stands for, and correspondingly a doctrinal defeat for the Palestinian Authority," Fayyad said.
The Palestinian Authority was established nearly two decades ago, as part of interim peace deals with Israel, and was meant to make way after five years for a Palestinian state alongside Israel. However, Israeli-Palestinian negotiations repeatedly broke down, at times amid bursts of violence, and failed to produce a final deal.
After the outbreak of the second Palestinian uprising in 2000, which resulted in harsh Israeli restrictions on Palestinian trade and movement, the Palestinian Authority became heavily dependent on foreign aid. It has received hundreds of millions of dollars each year since then, but has struggled to wean itself off foreign support.
Fayyad said his budget deficit has widened in recent years, blaming Arab states that broke aid promises.
"The financing problem that we`ve had ... In the last few years is solely due to some Arab donors not fulfilling their pledge of support in accordance with Arab League resolutions," Fayyad said. European countries kept all their aid commitments and the US honoured most, with the exception of USD 200 million held up by Congress last year, he added.
The crisis worsened sharply after the UN General Assembly voted overwhelmingly in late November, at the request of Abbas, to recognise a state of Palestine in the West Bank, Gaza and east Jerusalem, the territories Israel captured in 1967. Israel objected to the UN upgrade, accusing Abbas of trying to bypass negotiations.
Starting in December, Israel halted the monthly transfers of about USD 100 million in tax rebates it collects on behalf of the Palestinians. That sum amounts to about one-third of the monthly operating costs of the Palestinian Authority. Fayyad said he now only takes in about USD 50 million a month in revenues.
Today, Abbas declared that his Palestinian Authority would be known as the State of Palestine from now on, in keeping with UN recognition of Palestine as a non-member observer state in November.