By Bruno Waterfield - 14th May 2006
EU aid to Palestine is on the agenda as Europe’s foreign ministers urgently try to come up with a plan to avert a looming economic crisis.
The international community is now in a race against the clock to get a fund for channelling aid to the Palestinian people launched.
The EU must also decide on a mechanism to allow aid funding to Palestinians but not to their elected, blacklisted, Islamist militant Hamas government.
EU foreign policy chief Javier Solana told reporters the European commission is working on funding for schools and hospitals without going through the Palestinian Authority.
“We have to do it rapidly. The commission is working very hard on that but it will not be instantaneous,” he said.
One possible mechanism is for the international community to oversee direct aid payments to fund civil service wages.
“This is not decided. Very likely, salaries only related to only very basic needs such as schooling, hospitals,etc,” said Solana
There is confusion over the workings of the mechanism, where cash can be channelled and the scheme’s life span follow last week’s ‘Quartet’ meeting of the US, EU, UN and Russia.
“We have to talk to the World Bank and see if they want to be the agency in charge of the mechanism or not. There are other possibilities,” said Solana.
Ministers will assess how a new fund would operate, which donors would pay into it and what the cash would be used for.
Over 160,000 Palestinian Authority employees were not paid in March and April after an EU aid freeze and after Israel has withheld tax and customs revenues.
Speaking on Sunday, Palestinian Prime Minister Ismail Haniyeh dismissed plans for a fund that bypasses the Hamas government.
“We will not surrender to the measures by the quartet… all parties should deal in the same realistic way and deal directly with the Palestinian elected government,” he said.
“It is clear that these measures will take weeks and our Palestinian people will not be able to wait long to deal with this crisis.”
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