EU agrees EUR 120 million in aid for Palestinians

27th February 2006, Comments 0 comments

27 February 2006, BRUSSELS/TEL AVIV - European Union foreign ministers Monday agreed to send 120 million euros in emergency aid to the cash- strapped Palestinian Authority amid growing concern at deteriorating economic conditions in Gaza and the West Bank.

27 February 2006

BRUSSELS/TEL AVIV - European Union foreign ministers Monday agreed to send 120 million euros in emergency aid to the cash- strapped Palestinian Authority amid growing concern at deteriorating economic conditions in Gaza and the West Bank.

Hamas welcomed the EU decision, calling it a "step in the right direction", while James Wolfensohn, Middle East envoy of the so- called Quartet of peace makers, warned the Palestinian Authority had been facing financial collapse within two weeks.

The European Commission - the EU's executive arm which is also in charge of the bloc's financial aid programmes - said the money would be rushed to the current Palestinian caretaker government before the formation of a Hamas-led government next month.

"This is a very substantial package to meet the basic needs of the Palestinian people and support the caretaker government," European External Relations Commissioner Benita Ferrero-Waldner told reporters.

Ferrero-Waldner also said a new Hamas-led Palestinian Authority must be given time to forge a new government programme.

There was "still a chance" that the militant group which won last month's Palestinian legislative elections could comply with demands that it recognise Israel and renounce violence, Ferrero-Waldner said.

"Let's not rush...we need to have patience," the commissioner said, adding that once in government, Hamas would have to work with the international community to meet Palestinians' expectations for peace.

In the interim, the international community's immediate focus must be on providing Palestinian President Mahmoud Abbas with "full support" as he struggles to convince Hamas to change its hardline policies, she said.

"We have to tackle real hardships" in the Palestinian Territories, Ferrero-Waldner insisted, adding that the EU's financial aid package would help "ease the pressure" on Abbas for a few weeks.

Hamas welcomed the EU decision, calling it a "step in the right direction". In a statement sent to reporters, Sami Abu Zuhri, the movement's spokesman in the Gaza Strip, said that "Hamas welcomes any foreign aid to the Palestinian people as long as it's not connected to a trade-off of Palestinian people's rights."

He said the EU decision was an expression of the failure of the pressure Israel and the United States had imposed on European countries to hamper Hamas and place the Palestinians under siege.

In Brussels, German Foreign Minister Frank-Walter Steinmeier said the EU aid decision was not a "carte blanche" for the Palestinian government. "It is exactly the opposite, it is a signal that we back the Palestinian Authority and its president in setting up a government that meets our demands."

The EU was determined not to do anything that could harm Abbas, Steinmeier said.

French Foreign Minister Philippe Douste-Blazy told reporters the EU was trying to avert social, economic and security "chaos" in the Palestinian territories.

"Nothing could be worse than giving no assistance...we have to trust Abbas," said Douste-Blazy.

EU diplomats say that an Israeli decision earlier this month to freeze monthly transfers of up to 60 million dollars in tax and customs revenues that it collects on behalf of the Palestinian Authority has further worsened the plight of the Palestinian government which relies on foreign assistance at the best of times.

James Wolfensohn, the Middle East envoy of the so-called Quartet of peace makers - the United States, the EU, Russia and the United Nations - said the Palestinian Authority would face financial collapse within two weeks, largely because Israel had stopped transferring tax and VAT revenues.

In a letter to the Quartet, whose contents were reported in the Israeli media Monday, he warned that if the PA had to exist on emergency funds, the situation could lead to violence.

The 120 million euros in immediate EU help being provided to the Palestinian Authority would help meet Palestinians' "basic needs" but only for a few months, Ferrero-Waldner said.

EU funds have been earmarked for payment of Palestinians' utility bills, help for health and education and also to pay Palestinian government salaries.

A total of 64 million euros of the new package will be channelled to the Palestinians through the United Nations. An estimated 40 million euros will be used to directly pay Palestinian energy bills and another 17.5 million euros will be used to pay Palestinian salaries.

The EU - along with the US - has underlined repeatedly that it will only have dealings with Hamas if it recognises Israel, renounces violence and abides by past peace moves made by the Palestinian Authority.

Ferrero-Waldner said Hamas' electoral victory had clearly created a "new situation" for international aid donors who were unwilling to deal directly with the Islamic group, classified as a terrorist organization by both Washington and Brussels.

The EU was likely to insist Monday that other donors must also come up with funds for the Palestinians and demonstrate support for Abbas in the difficult weeks ahead.

Aid decisions are expected to be announced by Russia, Norway and Saudi Arabia but Washington has so far taken a tougher line on the issue.

EU officials said members of the international Quartet working for peace in the Middle East - including the EU, the United Nations, the US and Russia - were in weekly contact over the Palestinians' financial predicament.

"We have to judge the situation every week," said Ferrero-Waldner.

DPA

Subject: German news

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