French President Jacques Chirac announced the plan Friday to create a World Bank fund to pay the 165,000 PA employees. The Hamas-led government has not paid them in a month due to cuts in outside funding pending the group's tempering of its stated aim of liquidating the Jewish State through terrorist attacks and Jihad.

Standing aside Chirac was PLO chairman Mahmoud Abbas, who is on a European tour playing the role of the Palestinian moderate. "The international community should give this new government the opportunity to express itself, to adapt, to harmonize itself with international law," Abbas said. "Hamas is adapting. Hamas is today a government, a responsible government with ministers who are working with neighbors, with the Israelis and the world."

Hamas, which has not been asked by France to compromise its position in order to have the PA salaries paid – including those of tens of thousands of Hamas members and terrorists – did not object to the plan. "Any means that will maintain the authority of the government and the preservation of money and at the same time help the Palestinian people we will study and think about thoroughly," Hamas Authority Prime Minister Ismail Haniyeh said of the proposal.

"We have to talk about the details and preserve the rights of the [Hamas-controlled] ministry of finance to control and oversee all the financial procedures," PA Finance Minister Omar Abdel Razek said.

The European Union until now has given the PA $600 million a year. Several hundred million dollars have already been raised by the PA from countries such as Iran, Kuwait, Qatar and Russia. $50 million have made it into the PA coffers, according to Hamas officials, but another $40 million are stuck outside the PA. Banks have been reluctant to transfer the money to Hamas due to fear of repercussions from the US.

The US and EU have so far demanded that Hamas renounce terrorism, accept Israel's right to exist and respect previous PA commitments prior to renewed funding. Sources in both the US and EU declined to vocalize rejection of Chirac's proposal, leading to speculation that an alternate route of funding for the PA is being established.

The aim of depriving Hamas of financial support was to create pressure upon the PA government to soften its position, something that may be less likely to happen if a mechanism is created whereby the PA is funded via a loophole.
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