‘Emotional’ reaction might jeopardize PA economy
Following United States President Donald Trump’s recognition of Jerusalem as Israel’s capital, Palestinians are threatening to boycott USAID money, in response to Washington’s “unfair” policies towards the Palestinian cause.
Dalal Erekat, a senior Palestinian Authority (PA) official in the Prime Minister’s Office, told The Media Line that no comprehensive response to the White House’s move has been devised. “There is no official decision to cut ties with the U.S. This is a moral issue, and for now Palestinians are not dealing with the Americans.”
In this respect, PA President Mahmoud Abbas will boycott this week’s visit to Israel and the region by U.S. Vice President Mike Pence, who will be accompanied by chief American peace negotiator Jason Greenblatt.
Erekat contended that the PA could “survive without American money,” if Washington decided to cut off aid to the Palestinians. Since last year, she claimed, the U.S. has not been not supporting the PA to the extent it did in the past.
A source confirmed to The Media Line that various non-profit organizations (NGOs) in east Jerusalem have already informed USAID, which administers and distributes civilian foreign aid, that its contributions are no longer wanted.
The West Bank economy is heavily dependent on international aid. Early in 2013, there was a drop in international assistance to the PA for the first time in a decade, causing the GDP in the West Bank to shrink dramatically.
An economic analyst, who spoke to The Media Line on condition of anonymity, described the Palestinian reaction to Trump’s decision as “knee-jerk” and “emotional.” She stressed that the PA really needs to consider what is best for its citizens.
“If Palestinians want to wean themselves off donor money, by all means do it,” she asserted, while noting that all nations need to plan on becoming independent and self-sufficient. “But do so only after preparing the strategic groundwork and on one’s own terms. Otherwise, you could end up losing more than you can afford.”
The analyst pointed out that many educated professionals in the West Bank gain employment through in USAID projects. “Whether we like it or not, Palestinians have become a dependent society,” she asserted.
“If USAID money stops flowing into the public and private sectors, this will impact on the government’s ability to pay salaries. This would put tremendous pressure on the economy since the government employs twenty-two percent of the population. This, in turn, would also impact security issues,” she said.
After the establishment in the mid-1990s of autonomous territories in the West Bank and Gaza Strip, foreign governments began providing the Palestinians with huge sums of foreign aid. The U.S. is the biggest of some 20-odd donors, followed by European countries.
In total, the U.S. gave around $712 million in aid to Palestinians in 2016, some $300 million of which was earmarked for Palestinian refugees through the UN Relief and Works Agency, which also operates in Jordan, Syria and Lebanon.
Sam Bahour, an economic analyst, explained to The Media Line in a previous interview that a large proportion of these funds are allocated towards political and security needs, at the expense of economic and social ones. “Over the past ten years, a lot of the funds donated by the U.S. have gone towards beefing up the security forces or developing democratic institutions. In Palestine, we need to focus on education and infrastructure,” he stressed.
Earlier this month, the U.S. Congress passed a bill that will cut nearly half of the aid to the PA unless it stops paying monthly stipends to the families of dead, injured or imprisoned Palestinian “freedom fighters” (deemed terrorists by the Israeli authorities). The legislation stipulated that funds would still be disbursed for purely humanitarian initiatives, such as water projects and securing vaccinations for children.
The PA claims that over the past three years, these controversial funds have been paid through the Palestine Liberation Organization (PLO) and not from the PA’s own budget, thus are not drawn from foreign donor governments’ grants.
