World Bank in Talks With Quartet on Aid to Palestinians

Bank's President Wolfowitz says bank preparing to extend emergency support; any move would need Quartet support.

World Bank President Paul Wolfowitz said on Wednesday the bank wants to help deliver aid to Palestinians and is in discussions with the Quartet of Middle East negotiators on how it can be done.

The move by the World Bank comes amid a Western aid boycott that has pushed the Hamas-led government to the brink of financial collapse.

In a statement, Wolfowitz said as a first step the bank was preparing to extend an Emergency Services Support Program (ESSP), which for the past five years has provided support to Palestinian ministries on essential services, education, health and social affairs.

"The World Bank would like to facilitate the delivery of assistance that a number of donors are eager to provide so that the Palestinian people do not suffer from a lack of social services, particularly health and education," he said.

"We are in active discussion with members of the Quartet and our board of executive directors to find both immediate and longer-term solutions."

Wolfowitz said various donor countries had expressed interest in contributing to the support program.

He said the World Bank's executive board of member countries would have a final say on any plan for aid to the Palestinians.

Major donors like the United States and European Union froze direct aid to the Palestinian government after the Hamas militant group won January elections and refused to recognize Israel, renounce violence or embrace interim Israeli-Palestinian peace deals.

But fears of a humanitarian crisis prompted the Quartet, comprising the United States, the European Union, Russia and the United Nations, to agree last month to find ways to channel money to Palestinians that will bypass Hamas.

Hamas' inability to pay salaries since taking control of the Palestinian Authority in March, and tensions with PA Chairman Mahmoud Abbas over control of the security forces, has sparked internal violence and increased fears of civil war.

Under a proposed EU plan, aid from the Quartet countries would provide up to 30 million euros a month in cash "allowances" directly to government employees who provide essential services, particularly health care, EU documents have shown.

The World Bank has long managed a trust fund of donor money which helped pay the salaries of Palestinian civil servants, but that funding was frozen once Hamas won the vote.

Any move by the World Bank to help deliver aid to the Palestinians would need the support of the Quartet countries, particularly on complicated issues such as the flow of funds.