WEST BANK: Palestinian Authority said it had not been able to pay salaries on time for first time since 2007 because of Israel's decision to halt transfer of funds it collects on its behalf

Record ID: 560443

  • Title: WEST BANK: Palestinian Authority said it had not been able to pay salaries on time for first time since 2007 because of Israel's decision to halt transfer of funds it collects on its behalf
  • Date: 10th May 2011
  • Summary: RAMALLAH, WEST BANK (MAY 9, 2011) (REUTERS) PALESTINIAN PRIME MINISTER SALAM FAYYAD MEETING WITH THE CONSUL GENERAL OF FRANCE IN JERUSALEM FREDERIC DESAGNEAUX TO SIGN A FUNDING AGREEMENT PALESTINIAN FLAG VARIOUS OF FAYYAD AND DESAGNEAUX SIGNING AGREEMENT JOURNALIST AT SIGNING CEREMONY (SOUNDBITE) (Arabic) PALESTINIAN PRIME MINISTER, SALAM FAYYAD, SAYING: "The Palestinian authority cannot commit to pay the salaries for April this year; which should be paid through the first week of this month. The Palestinian Authority can not be committed to pay unless Israel transfers last month's tax revenues." MORE OF SIGNING CEREMONY
  • Embargoed: 25th May 2011 13:00
  • Keywords:
  • Location: West bank, West bank
  • City:
  • Country: Palestinian Territories
  • Topics: Finance,Domestic Politics
  • Reuters ID: LVA1IMXIUZM42R0AX3B1KEFHNK35
  • Story Text: The Palestinian Authority said on Monday (May 9) it had not been able to pay salaries on time for the first time since 2007 because of Israel's decision to halt the transfer of funds it collects on its behalf.
    Prime Minister Salam Fayyad said Israel's decision -- a move driven by Israeli concern over a Palestinian unity deal including Hamas -- had put the Ramallah-based government in an impossible financial position.
    "The Palestinian authority cannot commit to pay the salaries for April this year; which should be paid through the first week of this month. The Palestinian Authority can not be committed to pay unless Israel transfers last month's tax revenues," Fayyad told journalists during a signing ceremony for a financial agreement for budget support with the French government.
    Fayyad said the PA had paid salaries to its 150,000 employees promptly on the fifth day of every month since mid-2007.
    The Israeli government headed by Prime Minister Benjamin Netanyahu decided on May 1 to halt the transfers which make up 70 percent of PA revenues, citing fears that the money would go to Hamas, a militant group hostile to Israel.
    The Palestinian Authority, which is also heavily dependent on the financial support of donors including the United States and the European Union, has urged international intervention to convince Israel to reverse the decision.
    U.N. Secretary General Ban Ki-moon told Netanyahu on Friday (May 6) Israel should not withhold the revenues.
    Fayyad said there had been no communications with the Israeli finance ministry since the cancellation of a monthly meeting held to coordinate the transfer of the revenues, mostly collected on goods imported via Israel to PA-controlled areas.
    The salaries paid by the Palestinian Authority include those of some 70,000 employees in the Gaza Strip, who continued to receive their wages even after Hamas seized control of the territory in 2007.
    Hamas and Fatah, a rival Palestinian faction led by PA President Mahmoud Abbas, reached the surprise agreement aimed at ending their feud in Egyptian-mediated talks sealed with a public ceremony in Cairo last week.
    In the Cairo agreement, Hamas and Fatah agreed to the creation of a new, technocratic government that will hold elections within a year. The United States has said the new government must recognise Israel and renounce violence -- terms Hamas has historically rejected.
    A Hamas-led government that took office in 2006 faced a Western boycott, plunging the PA into financial crisis because of the group's refusal to agree to those terms.
    Palestinians believe the surprise unity deal unveiled will strengthen their hand as they seek international backing for independence, presenting a united front and ending a divide that has set back their quest for statehood.
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