ALGIERS, 29 October — Arab donor states have agreed to provide $90 million in financial aid to the Palestinian National Authority enable it to survive economic strangulation under Israeli occupation until the yearend.
The fund was agreed upon during meetings of finance and economy ministers of Muslim states in the Algerian capital. It is part of a $1-billion fund set up last year by Arab leaders following the outbreak of the second Palestinian intifada last September. The Al-Quds and Intifada funds are managed by the Jeddah-Islamic Bank, which hosted last week’s meetings of the ministers who make up the bank’s board of governors.
Arab leaders set up the funds at the initiative of Saudi Arabia’s Crown Prince Abdullah, deputy premier and commander of the National Guard.
The Kingdom pledged one quarter of the money ($250 million) which has since bee paid in full. The money will be used to build roads, hospitals and schools and to assist families of Palestinian “martyrs” and to beef up the Authority’s budget.
Yusuf Al-Bassam, chairman of the fund’s administrative committee, said the PNA will receive $45 million in November and a similar amount in December to pay for salaries and other administrative expenses over the coming two months.
Al-Bassam said representatives of the donor countries discussed ideas to broaden the fund’s base by attracting other Muslim countries.
“Contacts have been initiated with a number of states and there are also attempts to bring in some private institutions. The contacts are led by Qatar which chairs the current session of the Organization of the Islamic Conference.”
During the meetings the Palestinians asked for $165 million to enable them run their domestic affairs until the end of the year and proposed a $159 million in the form is a loan. The delegates differed over how this money could be secured with some calling for sticking to the fund’s mandate and other asking for alternative sources.
“The situation is worsening day by day. The taxes collected by the National Authority went down by 90 percent; not enough to pay for water and electricity bills and the stationary. Unemployment is rampant and right now 300,000 Palestinians are out of work, many of whom used to work inside Israel,” said Jirar Al-Qodwa, secretary general of the Palestinian Monetary Authority.
He said unless new sources are secured to stop the funds from drying out completely, the situation would get further worsen.
“The Palestinian people and the Authority will face an extremely difficult situation if the money dried up and no replenishments came forward.”
According to Al-Bassam, $693 million of the $1 billion have until now been pledged by the donor countries and that by next month this amount would be paid in full.
