PA fighting against financial collapse

Omar Abul Razeq, a former professor of finance and now finance minister of the cash-strapped Palestinian Authority (PA), is struggling to find a way to pay the wages of thousands of civil servants after the US and EU discontinued aid.

    Omar Abul Razeq: US, Israel and EU want a weak government

    Prior to the election win by Hamas, the European Union and the US were the two biggest donors to the PA, but they have cut off hundreds of millions of dollars in aid, demanding the Islamist group first renounce violence.

    "I am searching in every nook and cranny for a solution, even a temporary succour, to alleviate the crisis," Abul Razeq says, frustrated.

    Last week, the US issued a stern warning to banks in the region, threatening them with unspecified sanctions if they transferred money to the Palestinians.

    On Saturday, hundreds of Palestinian government workers demonstrated in the West Bank and Gaza demanding overdue wages. When are you going to pay the salaries of the 165,000 civil servants?
    Abdul Razeq: We are working day and night to secure these payments and I hope we will be able to pay the salaries very soon.
    But you and other Palestinian officials have been saying this for several weeks, and nothing has materialised.
    Yes, yes, I understand this too well. But I assure you, and I am sure our people know this as well, that we are doing what we can to overcome this crisis.

    Last week, we thought the crisis was being mitigated when we succeeded in procuring enough money to pay the salaries, but then the Americans bullied the banks, barring them from transferring the money to the occupied territories.
    Are the banks that vulnerable to American pressure?
    Yes, since they rely on the so-called "correspondent banks" in the US for making transfers in US currency to any part of the world.
    How much money have you been able to procure so far?
    We have been promised hundreds of millions of dollars. Iran and Saudi Arabia have promised $100 million each. Libya has also promised an unspecified amount.
    In our hands here we have nothing. But we have already received around $70 million which are kept in a special fund at the Arab League in Cairo.

    How much money have you received from the Iranians? And aren't you worried that the Iranian connection might harm you?
    The details of the Iranian contribution are still being worked out. As to what you called "Iranian connection", I want to ask you, what are we supposed to do? Starve to death? Besides, the Iranians are our brothers and have an Islamic obligation to stand beside us. In any case, it wouldn't make any difference.
    Is it true some Arab countries have been reluctant to help you because they fear US sanctions?
    I don't know about this. I am not sure it is because they fear US sanctions. These processes usually take some time.
    The US and the EU have said they would resume financial aid if you recognised Israel, disavowed violence and accepted outstanding agreements between Israel and the PA.
    Which Israel would you want me to recognise? Is it Israel from the Nile to the Euphrates? Israel with the occupied Golan Heights? Israel with East Jerusalem? Israel with the settlements? I challenge you to tell me where Israel's borders lie. Or do you want to sell me fish in the sea?
     … the 1967 borders.
    Does Israel recognise the 1967 borders? Can you tell me of one Israeli government that ever voiced willingness to withdraw to the 1967 borders?
    Are you prepared to face the possible financial collapse of the PA?
    There wouldn't be only a financial collapse, the entire system would collapse. There would be chaos and violence all over the area. In short, not only Hamas would be affected, but everybody else as well. I repeat, everybody else.
    Do you think the US, Israel and Europe are interested in seeing the PA collapse?

    I don't think so. My impression is that they want to see a weak Palestinian government that would budge to Israeli dictates and American pressure. In short, they want a government that would act like a quisling entity vis-a-vis Israel, a government that would agree to sell out paramount Palestinian rights in return for money and mere survival.
    Who do you think would be blamed for the collapse of the PA if and when that happened?
    Surely, Israel and the United States. Muslims around the world would view the US as an evil power that is hell bent on harming and tormenting Muslims. Many people would also lose faith in western democracy.
    Do you have contingency plans in case the PA collapsed?
    We are under a foreign military occupation and we take things as they come.
    How much Palestinian money is Israel withholding?
    I would say around $300 million.
    French President Jacques Chirac has proposed the creation of a trustee fund through which foreign aid could be channelled directly to Palestinian public employee. How do you view this proposal?
    We are dealing positively with this proposal. The problem is that the Americans are objecting to it.
    Have you received your salary?

    SOURCE: Aljazeera



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