Palestinian to seek 5.5 billion euros aid at Paris meeting - Haaretz

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Mon., December 03, 2007 Kislev 23, 5768

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Palestinian to seek 5.5 billion euros aid at Paris meeting

By Reuters

RAMALLAH - The government of President Mahmoud Abbas will ask donors in Paris this month to provide 5.5 billion euros in aid to strengthen the cash-strapped Palestinian Authority, Palestinian officials said yesterday.

The aid, to be used for budgetary support and development, is meant to strengthen Abbas against Hamas Islamists and to revive the Palestinian economy after the president launched formal peace talks with Israel last week.

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Prime Minister Salam Fayyad will ask donors at the Paris conference, scheduled for December 17, to provide the aid over a period of three years. The request is based on an economic plan for 2007 to 2010, said a senior Palestinian official.

The conference is the first forum since 1996 at which international donor states can make pledges to the PA, officials noted.

"The government desperately needs the aid because by the end of the year, it will not have funds to pay its outstanding private-sector debts and salaries to the government employees, which amount to more than 500 million euros and other expenses," another official said.

In Annapolis last week Abbas and Israel launched talks aimed at creating a Palestinian state by the end of 2008.

Hamas routed Abbas' forces in the Gaza Strip in June, prompting him to sack the Hamas-led government and to appoint the Western-educated Fayyad to lead an administration in the West Bank.

After the move, Western countries removed economic sanctions in place since Hamas won a parliamentary election in January, 2006, which had pushed the PA to the brink of collapse. Sanctions remain on Hamas-controlled Gaza.

Final draft

Fayyad's government is expected to approve today the final draft of the document which will be presented at the Paris conference to international donors, Palestinian officials said. Some Western and Arab states have already sent aid to Fayyad's administration, they added.

According to a draft of the report, 71 percent of the funds will be used for budget support and 29 percent for development.

"Twenty-six percent of the plan's budget will go to reforms, such as [those involving] the security services, judicial system and other governance sectors. Twenty-one percent is allocated for the economic sector and 23 percent for the infrastructure," a senior official said.

Analysts say Abbas' credibility will be undermined if his government does not manage to revive an economy damaged badly by violence and sanctions.

"If the Palestinians in the West Bank and Gaza don't feel an improvement in their daily lives, Abbas' peace policies will be weakened," Palestinian analyst Abdel-majid Sweilem said.

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