Palestinian finance minister threatens to quit

Australian Broadcasting Company ^ | January 04 2004 | AFP

[knighthawk]

Palestinian finance minister Salam Fayad has threatened to resign in a dispute with veteran leader Yasser Arafat over reforms to the security budget, official sources said Sunday.

Mr Fayad, a former official in the World Bank and International Monetary Fund, told Mr Arafat several days ago that he would resign unless the budget was administered more transparently.

Palestinian security forces continue to be largely paid by cash despite efforts by Mr Fayad to ensure that their salaries are administered through banks and with proper accounting procedures.

"It is a conflict over how to run and administer the budget of the security services," one source told AFP.

"The budget of national forces should go through regular banks."

Mr Fayad has been widely praised by the United States for bringing about a more transparent financial system but there is concern that the reform process has run out of steam.

Another source said that Mr Fayad had come under pressure from US officials and other donor countries at a recent conference in Rome.

"He was told bluntly by the Americans that the PA (Palestinian Authority) must restart the reform process," said one Palestinian source.

"We received much more of a blasting in private than in public."

Mr Arafat has been determined to maintain his tight grip over the security services.

Former premier Mahmud Abbas was forced to quit in September after he lost out to Mr Arafat in a battle for control of the security apparatus.

[knighthawk]

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