Palestinian Finance Minister Resigns Over Burgeoning Budget Deficit

Nabil Qassis says he decided to quit after his proposed austerity measures were struck down; Palestinian Authority's 2013 budget deficit expected to reach $1.4 billion.

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The Palestinian Authority's finance minister in the West Bank has announced his resignation in a show of frustration over the government's widening budget deficit.

Nabil Qassis told reporters Sunday that the PA's 2013 budget deficit is expected to reach $1.4 billion. He says he decided to step down after politicians and labor unions objected to a number of proposed austerity measures.

The PA, the self-rule government in the West Bank, has been struggling with a financial crisis in recent years due to cuts in aid from the United States, Israeli delays in transferring tax payments and the failure by Arab allies to deliver hundreds of millions of dollars in promised assistance.

Israel suspended transfer of Palestinian tax funds after the United Nations General Assembly vote to upgrade the status of the Palestinians to that of nonmember observer state in November last year. In January, Israel announced it was renewing the transfer of Palestinian tax funds.

According to reports released last week against the backdrop of escalating clashes between Palestinian protesters and IDF troops, Israel had transferred January's tax funds to Ramallah – funds collected by Israel on behalf of the PA under the Oslo Accords. But a Palestinian source told Haaretz at the time that the claims were unfounded.

A file picture taken in 2004 shows Nabil Qassis, then Palestinian planning minister, at the World Economic Forum in Shuneh. Credit: AFP

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