CMEP Bulletin: Gaza’s Qatar Gift May be the PA’s Curse
CMEP’s weekly news update
Gaza-West Bank Divide Grows
After last week’s visit to Gaza by the Emir of Qatar who promised $400 million in aid for the beleaguered territory, there are concerns that the rift between the Palestinian Authority and Hamas is widening. Hamas runs governmental ministries, police forces and border crossings in Gaza, leaving little motivation to give up power for the sake of unity with the Palestinian Authority. Qatar’s money reinforces and legitimizes Hamas at a time when the PA’s economy is collapsing and it is losing popular support.
Yasser Abed Rabbo, an adviser to PA President Mahmoud Abbas, explained the reservations the West Bank leadership has about the emerging relationships in the Arab world that Hamas is forging, telling the Associated Press, “No one should deal with Gaza as a separate entity from the Palestinian territories and from the Palestinian Authority.”
The new housing, hospital and roads built with Qatar’s financing will create thousands of jobs and in turn, raise Hamas’ popular support with Gazans. In its $760 million 2012 budget, Hamas only dedicated $14 million of it to “welfare.” In addition, this year Saudi Arabia has given $250 million and Turkey $300 million. Gaza is rebuilding after the disastrous 2008-2009 Cast Lead invasion by Israeli forces aimed at stopping rocket attacks from Israel. In large part due to smuggling materials from Egypt, the World Bank figures, reports that constructions starts in the first half of 2011 grew by 220 percent. Nicolas Pelham writes for the New York Review of Books:
The economic effects have been remarkable: after notching 6 percent growth in 2008, the Gazan economy grew by 20 percent in 2010 and a whopping 27 percent last year; unemployment in the formal economy fell to 29 percent, its lowest in a decade and an improvement of eight percentage points in a year.”
This $400 million Qatari aid package comes at a precarious time for the Palestinian Authority in the West Bank, which is experiencing a deepening financial crisis and declining support. A September World Bank report warned that the PA faces a $400 million budget shortfall this year and it could be worse if donors do not meet their pledges. Pelham writes that as Arab governments shift millions of dollars in aid money from the PA to Hamas, they are “signaling what may be a historic shift in Palestinian politics.”
Abbas is focusing on an upcoming vote in the UN General Assembly to upgrade the Palestinian Authority from “observer” to “non-member state.” The vote could happen either November 15 or 29 according to sources. Palestinian leaders are concerned about the financial ramifications of such a move. Israel could withhold tax transfers that make up 33 percent of the PA’s budget. The United States would also cut off most funding. Arab states have pledged $100 million but Palestinians are skeptical of actually receiving it. Any further budget constraints would exacerbate problems in the West Bank and present a stark contrast to the growing Gazan economy. However, Abbas could receive a boost in popular support for securing increased international recognition.