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Hamas’ Account Overdrawn

Prepared by: cfr.org editorial staff
March 8, 2006

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The new Hamas-led Palestinian government is facing a financial crisis after winning parliamentary elections in January. Europe and the United States have threatened to slash aid to the Palestinian territories unless Hamas meets their demands to renounce violence and recognize Israel. In response to the PA’s financial woes, the World Bank announced a $42-million grant to meet immediate financial needs and to “avoid suspension of vital basic services to the Palestinian population.” Israel has withheld some $55 million a month since Hamas’ victory and the PA budget deficit runs at about $120 million a month (NYT).

But despite pressure to change its platform, the Islamist group is showing few signs of the moderation needed to engage in a peace process with Israel and continue receiving international financial support. The Palestinian Prime Minister-designate, Ismail Haniyeh, accused the “Quartet” members engaged in the Midde East peace process—the United States, Russia, United Kingdom, and United Nations—of applying a double standard to the Palestinians. “They are not asking anything of Israel,” Haniyeh said (Guardian). PA President Mahmoud Abbas, whose powers granted by the last Fatah-controlled legislature were revoked by Hamas (BBC), told the Italian newspaper Corriere della Sera that the group would have to moderate its stance if it wanted to govern (Haaretz).

The international community itself is divided on how to deal with the Hamas government. Russia, for example, split from its other partners in the Middle East peace process by inviting Hamas leaders for a visit. In Moscow, Hamas official Mohammed Nazzal admitted the organization must “change its manners,” but reiterated it would not alter its policies until Israel did the same (Gulf Daily News). Russian Foreign Minister Sergey Lavrov said that, after meeting Hamas leaders, he was hopeful the group would endorse the road map peace accord. European Union foreign ministers are also considering ways to continue aiding Palestinians while keeping their pressure on Hamas (Reuters). In contrast, the United States has said it will not cooperate with a Hamas government.

Rob Malley of the International Crisis Group writes in Beirut ’s Daily Star that Washington , if it works through Abbas, can achieve its goals in the region without compromising its principles. Rashid Khalidi, director of Columbia ’s Middle East Institute, tells cfr.org’s Bernard Gwertzman that Hamas is capable of a securing a lasting cessation of violence, but there will need to be better engagement with the United States and Israel. And David Makovsky, Michael Herzog, and Elizabeth Young of the Washington Institute for Near East Policy say the international community should focus on humanitarian aid and education—while cutting back on wage assistance and reconstruction funds—until Hamas proves itself as a governing body.

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