EU Breaks Freeze on Funding PA

The European Union has caved in to Hamas pressure, announcing it will renew aid to the Palestinian Authority, despite a Quartet ban on funding.

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Hana Levi Julian,

The European Union has agreed to transfer 4 million euros (approximately $5 million) to the coffers of the Palestinian Authority government, effectively ending a freeze by Western nations on funding the Hamas terrorist-led entity.


“The EU is resuming its support of the Palestinian Authority in a direct manner through the finance ministry,” announced PA Finance Minister Dr. Salem Fayyad at a news conference Monday.


The money is to be used for a project “to assist the Minister of Finance in ensuring the proper use of Palestinian taxpayers’ money” and that expenditures are accounted for, said EU representative John Kjaer.


Mr. Kjaer signed the memorandum of understanding with Dr. Fayyad, clearing the way for a new flow of funds to the PA government.


"The European Union's first step will be a €4 million project to help the minister of finance in ensuring that Palestinian taxpayers' money is spent efficiently and that all expenditures are accounted for to the highest international standards," read a statement by the EU.

Training for the financial management project will reportedly begin in the PA Finance Ministry’s offices in Ramallah and Gaza City and will be carried out by the accountancy firm Ernst & Young.


The Quartet, of which the European Union is a member as well as the United States, Russia and the United Nations, declared a freeze on funding to the PA until the Hamas-led government officially recognizes the State of Israel, renounces terrorism and fulfills past agreements.


The Quartet members had also said they would not acknowledge the Fatah-Hamas unity government until it fulfilled the conditions.


The freeze went into effect in January 2006, immediately after the Hamas terrorist organization, whose charter plainly states its intent to destroy the State of Israel, took control of the PA government in a landslide victory.


“The European Union has always played a leading role working with the Palestinian Authority to help it achieve its objective of managing public money efficiently and transparently,” said Dr. Fayyad in a statement.


The financial move raises the status of the PA without formal acceptance.  It is also likely to result in increased pressure on Israel to release $700 million in tax revenue collected for the PA but withheld following the Hamas victory, leading to an accelerated disintegration of Western resolve to boycott the terrorist organization.


U.S. Secretary of State Condoleezza Rice has recently returned to pressuring Israel into releasing the funds, despite America’s ban against transferring money to Hamas.


In explaining her actions, she told The Associated Press, "I understand the Israelis' concerns about what might happen to tax revenue, but we think that there are mechanisms that they could use in the ways that they have in the recent past to support important activities."

Prime Minister Ehud Olmert acceded to her request several months ago to release almost $100 million in tax revenues. PA Chairman Mahmoud Abbas cancelled a planned meeting with Mr. Olmert due to the prime minister's refusal last week to agree to free more money, among other reasons.