EU threatens aid cut if Hamas fails to reform

10th March 2006, Comments 0 comments

10 March 2006, SALZBURG, AUSTRIA - The European Union on Friday gave its starkest warning yet of massive aid cuts for Palestinians if a Hamas-led government sticks to a hard line on Israel and terrorism.

10 March 2006

SALZBURG, AUSTRIA - The European Union on Friday gave its starkest warning yet of massive aid cuts for Palestinians if a Hamas-led government sticks to a hard line on Israel and terrorism.

"We will not go soft on our principles," said EU external relations commissioner Benita Ferrero-Waldner, adding: "Money will not flow to the new Palestinian Authority unless it seeks peace by peaceful means."

A report to the EU's 25 foreign ministers by Ferrero-Waldner and the bloc's chief diplomat Javier Solana indicated up to 80 per cent of the 500 million euros a year in EU aid to the West Bank and Gaza was in danger.

German Foreign Minister Frank-Walter Steinmeier said Hamas had to meet three key conditions in order to continue drawing aid from the bloc:

- Recognition of Israel

- Renouncing violence

- Accepting all previous agreements between Israel and the Palestinians.

"Without a declaration which satisfies us...there will be no cooperation with a government led by Hamas," said Steinmeier in remarks to reporters.

The German Foreign Minister said recent talks by Hamas leaders with officials in Russia and Turkey showed there was no softening of the militant group's policies.

"There have been no serious signals on any of these three criteria," he said.

Last week's decision by EU governments to grant 120 million euros in emergency aid to the Palestinians was only valid until the creation of a new government, said Steinmeier.

Future decisions on assistance would be strictly based on the new Palestinian government's programme, he added.

The EU's Palestinian aid paper warned "the continuation of EU financial support to the Palestinian Territories beyond traditional humanitarian assistance may be seriously affected."

Only 20 per cent of EU aid to the Palestinians is humanitarian - including food deliveries - and mainly channelled through independent relief agencies.

The rest, including social, economic and emergency assistance involves direct interaction with national and local Palestinian officials.

"Under current circumstances many ongoing projects would need to be suspended," the report cautioned.

Solana and Ferrero-Waldner highlighted especially deep cuts to funds for the EU's crucial infrastructure aid and efforts to build a Palestinian customs and judiciary. Money for building up the private sector was also in danger, they said.

EU aid cuts - coming on top of Israel's holding back of 60 million dollars worth of Palestinian tax revenues - would further deepen the economic crisis in the West Bank and Gaza.

Diplomats said that one way out of the current impasse could include a Hamas endorsement of a 2002 Arab peace plan which calls for the mutual recognition of Israel and an independent Palestine state.

Another way to get around an intransigent Hamas would be for the bloc to deal directly with Palestinian President Mahmoud Abbas or work through an independent "trust fund" to provide the much-needed aid.

Ferrero-Waldner said the EU was determined to show full political support for Abbas who will be in Vienna next week and will also address the European Parliament in Strasbourg.

"The situation is very difficult," said Solana, adding that no EU decisions on future aid could be expected before the formation of a new Palestinian government and Israeli elections, to be held later this month.

Separately, ministers in Salzburg will endorse a ten-point plan to forge stronger contacts between Europe and the Muslim world to ease tensions triggered by publication of caricatures of the Prophet Mohammed.

Iran's controversial nuclear programme is another major issue facing EU ministers.

Both Solana and Ferrero-Waldner insisted that although Iran was being hauled in front of the United Nations Security Council, there was still time for a diplomatic deal.

Austria, as current president of the 25-nation union, has also invited foreign ministers from the Balkan states to the meeting on Saturday.


Subject: German news

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