U.S. senators push bill to restrict non-humanitarian aid to PA

By Reuters

Haaretz

Adar 7, 5766

About a dozen senators sponsored a bill on Monday that would restrict non-humanitarian U.S. aid to the new Palestinian government being formed by Hamas unless it renounces terrorism and publicly recognizes Israel's right to exist.

The bipartisan bill, which is less sweeping than a companion measure in the House of Representatives, would allow food, medicine and other humanitarian aid that does not go through the Palestinian government to continue, as well as funding for democracy programs.

It would give President George W. Bush more leeway to waive limits on diplomatic contacts and other restrictions than the tougher House version.

Hamas, which has been dedicated to Israel's destruction, won Palestinian elections in January over the Fatah party and is in the process of forming a new government.

"Both Sen. Biden and I appreciate the need not to punish the Palestinian people for actions its future government may take," said Senate Republican Whip Mitch McConnell of Kentucky.

McConnell, Majority Leader Bill Frist of Tennessee and Sen. Joseph Biden of Delaware, the Democrat on the the Senate Foreign Relations Committee, were among the bill's sponsors.

The American Israel Public Affairs Committee, a pro-Israel lobbying organization, was expected to send members to Capitol Hill on Tuesday to urge lawmakers to back both bills.

The House bill, which has not been endorsed by the Bush administration, would restrict non-humanitarian assistance through non-governmental organizations, cut diplomatic contacts with the Palestinian Authority and treat it as a terrorist entity.

The bill would also close the authority's offices in the United States and withhold U.S. funds to the United Nations equal to the amount the world body provides the Palestinians.

The Senate bill makes more room for the administration to deal with the Palestinians and has somewhat less stringent requirements for the new government.

The Senate bill would restrict aid to the Palestinian Authority unless it is determined that no government ministry is controlled by terrorists. The Hamas government must also recommit itself to previous agreements with Israel, make progress toward dismantling any terrorist infrastructure and institute fiscal transparency.

Israel, donor nations consider funneling PA aid via World Bank
Israel and donor nations are discussing a proposal to funnel most international aid to the Palestinians through the World Bank, in a bid to keep funds from a Hamas-led government, Israeli and Western diplomats said on Monday.

The World Bank already manages a trust fund that provides budgetary support to the Palestinian Authority.

Expanding the World Bank's role could enable donors to sidestep the Palestinian government being formed by the Islamic militant group while ensuring humanitarian assistance gets through to the Palestinian people, sources familiar with the proposal said.

"That is one of the options being looked at ... to allow the Palestinians to receive the humanitarian aid they need and, at the same time, ensure (the money) doesn't go to terror," said a senior Israeli official who spoke on condition of anonymity because a decision has yet to be made.

A Western diplomatic source said the proposal was being pushed mainly by Israel and it was unclear whether it would be accepted by major donors because of complications involved in expanding the World Bank's mandate.

Israel froze tax revenue transfers to the cash-strapped Palestinian Authority starting this month in a bid to isolate Hamas, which won the Jan. 25 Palestinian election. The tax revenues are worth around $50-55 million a month.

Foreign Ministry spokesman Mark Regev declined to comment on the specific options under discussions to funnel aid to the Palestinian people once Hamas forms a government.

"While it is important to cut off direct financial support to a Hamas-controlled Palestinian Treasury, it is important to energize direct aid for the Palestinian people throughnon-government agencies," Regev said.

It is unclear whether Israel could transfer to the World Bank the tax revenues it collects on behalf of the Palestinians. An Israeli official said doing so would require a court order.

"The World Bank will not touch money that legally belongs to the Palestinians unless they have a request from the Palestinians," a Western diplomatic source said.

Top UN and European Union officials have called on Israel to resume the transfer of tax revenues to the Palestinian Authority so it can pay salaries to an estimated 140,000 workers and security personnel.

As many as one in four Palestinians is dependent on wages from the Authority, prompting warnings last week from international envoy James Wolfensohn that violence could break out if salaries were not paid.

The World Bank has managed a multidonor reform fund for the
Palestinian Authority since 2004.

A total of $310 million has been committed to the Public Financial Management Reform Trust Fund by 12 donors, of which $250 million has been disbursed. The biggest contributors are the European Commission, Japan, Norway and Britain.

A Western diplomatic source said Israel's proposal would amount to a major expansion of the World Bank's role.

"It would be like the World Bank administering the entire Palestinian budget," the source said. "This would require a much bigger international decision."

Palestinians depend on foreign aid totalling more than $1 billion a year. It is unclear how much of that money would be withheld by international donors once Hamas, whose charter calls for Israel's destruction, forms a government.

Since a Palestinian revolt erupted in 2000, Hamas has masterminded at least 60 suicide bombings against Israelis. But it has largely abided by a truce declared last year.