Dec 13 (KUNA) — A major conference of international donors, being held in the French capital Dec 17, hopes to raise around USD 5.6 billion in budgetary and project aid for the Palestinians over the next three years, diplomats revealed here on Thursday.
Some ninety delegations have been invited to attend the event, including Kuwait, which is to be represented by Deputy Prime Minister and Foreign Minister, Sheikh Dr. Mohammed Sabah Al-Salem Al-Sabah.
Speaking off the record here, the diplomats indicated that the contributions to help the Palestinians would not just be given to the Palestinian Authority but were also intended for Gaza, which is not under the control of the Authority but is controlled by Hamas.
The financing accorded at the conference will be mostly in the form of grants for 2008-2010 and is contingent on the Palestinian reform program that has gotten the green light from international institutions like the International Monetary Fund and the World Bank.
One senior diplomat remarked that “Gaza is included in the program and its financial needs are taken into account.” He cited plans to pay salaries of civil servants working in Gaza, like teachers, health workers etc. And he noted that a lot of the emergency aid for projects would be going to Gaza.
The official, who has vast experience in international finance and bureaucracy said that the Palestinian program of Prime Minister Salam Fayyad “is ambitious and realistic” and he said that there was a consensus in the international community on “burden sharing” to finance the revitalization of the beleaguered Palestinian economy.
Aid and grants will not be expected from purely “one geographic zone,” the diplomat said.
He also stressed that control of funds and management of projects would not be solely in the hands of the Palestinian Authority administration.
He further indicated that there could be three mechanisms to contribute funds.
The first is a “Single Treasury Account” that is managed by the Palestinian government and in which France has already deposited Euros 15 million “as a sign of confidence” in Fayyads program.
The second mechanism is a European Union Interim Mechanism, which will not be transitory.
The third is a multi-lateral donors Trust Fund.
The diplomat said that he felt the international community would want to use one of these mechanisms rather than give bilateral donations which are more cumbersome and more difficult to control.
The officials involved in the preparations for next weeks conference said that they had confidence in the investment climate in the Palestinian areas, noting this was better than in some other countries in the region.
There is less bureaucracy, less corruption and better ways of doing business here than in many places elsewhere, he said.
But despite the optimism, it was noted that some donors – Britain was cited – are making contributions conditional on security developments for Israel and certain aid could be withheld if Israel does not feel secure enough to take down some of the 450 barrages it has put up in the Occupied Territories.
This would mean that Israel could have a significant leverage over how or where aid is disbursed. But it was also pointed out that without security there could be no major development on the economic side.
For 2008, the Palestinians say they need over USD 1.8 billion of which more than USD 1.3 billion is budgetary aid to pay running costs and over USD 460 million is for project aid.