The West Bank 'Stimulus Package' Is Running Out

Saudi Arabia and the United Arab Emirates, which have been the main supporters of the West Bank since 2007,  have cut back significantly this year:

Arab states have cut financial aid to the Palestinian Authority (PA) so far this year, according to PA figures seen by Reuters, and the United Nations has warned of a looming Palestinian cash crisis.


"The Arabs are not paying. We urge them to meet their financial pledges," said Saleh Rafat, a member of the Palestine Liberation Organisation's executive committee and one of the few Palestinian officials willing to speak out on the matter.

One intriguing possibility is that these countries are cutting back so that they can simultaneously give both Fatah and Hamas an elbow to the ribs:

Some Palestinian officials speculate Arab states might be withholding the cash to try to persuade the Palestinian factions Fatah, which controls the West Bank, and Hamas, which controls Gaza, towards reconciliation.

...Aid is crucial in helping pay the wages of 148,000 PA employees including 67,000 in the Gaza Strip, whose salaries support a Gazan economy that has withered under an embargo imposed by Israel since the Hamas group rose to power there.

One of the reasons Hamas is able to make due is the money that it gets from the West Bank. Cutbacks to the latter will inevitably affect the former.

But an EU representative is denying that the cutbacks are tied to negotiations with Israel:Roy Dickenson categorically rejected the PA's accusations that donor countries were withholding assistance as the international community pushes for a return to direct peace talks.

In any case, donations are especially important to the West Bank, seeing as how they are the secret to its 'financial success':

Palestinian policymakers say donor support has been one of the main engines of strong economic growth in the West Bank, estimated at up to 8 percent this year.

Sounds like an Obama-style stimulus package--Mideast style.
It seems that they too are about to learn what happens when the money runs out.

Technorati Tag: West Bank.