Posted on 02/27/2006 11:32:47 AM PST by NormsRevenge
JERUSALEM (Reuters) - International envoy James Wolfensohn told Middle East mediators the Palestinian Authority faces financial collapse within two weeks because of Israel's decision to cut off tax transfers after Hamas's election win.
Even if the Palestinian Authority survives the coming month with emergency funding, Wolfensohn said "violence and chaos" could break out unless a long-term funding plan is developed for when a government led by the Islamic militant group is in place.
Wolfensohn issued the warnings in a letter to the so-called Quartet of Middle East mediators -- the United States, the European Union, the United Nations and Russia. A copy of the letter was obtained by Reuters from a Quartet member on Monday.
The Quartet threatened last month to cut aid to a government led by Hamas, whose charter calls for the destruction of Israel, unless it renounced violence, recognized the Jewish state and abided by interim peace deals.
Wolfensohn, who will brief the Quartet on Wednesday about the Palestinian Authority's cash crunch, said it needed $60 million to $80 million next week to begin paying the February salaries of about 140,000 Palestinian workers, including security personnel.
As many as one in four Palestinians are dependent on wages from the Palestinian Authority, prompting fears of unrest before Israel's March 28 election if payroll is not met on time.
"I know I do not need to tell each of you that the failure to pay salaries may have wide-ranging consequences -- not only for the Palestinian economy but also for security and stability for both the Palestinians and the Israelis," Wolfensohn said.
Wolfensohn's office declined to comment on the February 25 letter, in which he urged Israel to consider redirecting the Palestinian Authority's frozen tax revenues to pay its fuel bills to Israeli utilities.
Israel's Foreign Ministry spokesman, Mark Regev, did not rule that out, saying Israeli courts could decide to transfer some of the money to the utilities.
Regev blamed a Palestinian Authority hiring and spending spree for the current crisis. "If there is a financial crisis in the Palestinian Authority today, that is largely due to their irresponsible pocketbook electioneering," Regev said.
FUNDING GAP
Despite emergency aid from the European Union and others, Wolfensohn said the caretaker Palestinian government still faced a funding gap of $100 million in February, mainly because of Israel's decision to withhold $50 million to $55 million a month in tax revenue starting on March 1.
The projected funding gap in March will be $12 million to $70 million. "Unless a solution is found, we may be facing the financial collapse of the PA within two weeks," Wolfensohn said.
Wolfensohn's deficit figures included a short-term aid package unveiled by the European Union on Monday.
But the 25-nation bloc made sure most of the $142 million (120 million euros) contribution would bypass the Palestinian Authority, and only about $20.7 million (17.5 million euros) would help pay salaries.
Wolfensohn said Saudi Arabia would provide the authority with $20 million this month, while Norway and Russia would each give $10 million by the end of March.
But any money raised by Wolfensohn at the Quartet's direction would only tide the Palestinian Authority over until the new Hamas-led cabinet is formed, most likely next month.
The Quartet has yet to agree on what to do once Hamas takes over and over how much pressure to exert. Israel has asked donors to freeze all but humanitarian assistance, but some Quartet members favor giving Hamas some time before taking action, diplomatic sources said.
Wolfensohn proposed a meeting of the United Nations and key donors in the second week of March to set a longer-term aid strategy.
Good. The less money they have, the less resources for terrorism.
Good, maybe they'll have to work for a living, like the rest of the world.
Then they may not have as much time to go bombing.....
These are people who want their own state, who want to push Israel into the sea, and yet they can't keep their own little pseudo-state afloat without financial payments from...Israel.
Unless the PA can impose a tax on hatred and explosives, sounds like Hamas ... er, I mean the PA ... is out of business.
Surely some jew-hater somewhere would be willing to fund their genocidal ambitions ...
Petro dollars. Immediately. The imams are always going on about the plight of the Palestinians. Pony up.
Good!
Even if the Palestinian Authority survives the coming month with emergency funding, Wolfensohn said "violence and chaos" could break out unless a long-term funding plan is developed for when a government led by the Islamic militant group is in place.
More violence and chaos than we have seen over the past ten years? How will we be able to tell? We should not give in to blackmail from Hamas. Maybe the Pallies should ask what has happened to the billions supplied by us and the Europeans over the years. It sure hasn't gone into public works!
Faster, please!
Hamas wants to bomb Israel and wants Israel to help pay for the bombing.
Cute.
Begging and demanding is the pali economic program. About like NOLA.
Something about making a bed and then lying in it comes to mind...
I think this is the first time in human history where an entire nation (or lack there of) people on welfare have derailed their own gravy train through voting.
Remind me again why are we giving any money to these murderous filth?
The Arab states wanted to keep Palestine as a welfare state full of "refugees" for their own reasons and they got their wish. Let them come up with the petro-cash needed to support these murderous loons. With oil at $60/bbl the Arabs are taking money from us hand over fist. They can afford this.
Not one more dime of American tax money should go to these fanatics!
If the PA is virtually broke, that must mean they haven't unlocked Arafat's secret bank accounts yet.
And this is a problem... why?
Who would have guessed that an economy based on suicide child bombers wouldn't be sustainable? Seemed like a good plan at the time.
If the palestinians all starve it is too damn bad. Maybe they shoud have spent the funds they have or had on the betterment of their folks instead of attacking Israel.
Education is a wonderful thing. Teach a man to fish or work for a living and maybe they will feed their family. Teach a man to live like a killing dog and they will do little then kill.
Screw the leaches called palestinains,
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