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(Commentary) Evelyn Gordon - The World Bank issued another report on the Palestinian economy, blaming Israel, but the truth is the PA hasn't a prayer of ever resolving its fiscal crisis without addressing the real elephant in the room: Gaza. According to PA Prime Minister Salam Fayyad, Gaza accounts for 48% of the PA's expenditures, while revenues received from Gaza are a mere 4% of the PA's budget. Nothing Israel does will be able to compensate for that. Because Hamas controls Gaza, the PA can't collect taxes there - and Hamas has no interest in giving the PA any of the taxes it collects. After the EU stopped paying for Gaza's electricity in 2010, the PA picked up the tab. Five years after Hamas took over Gaza, the PA is still paying 60,000 former PA employees full salaries to sit at home and do nothing. The PA's international donors are slated to meet on Sep. 23. If they really want to solve the PA's fiscal crisis, they need to issue an ultimatum: Either the PA stops blowing half its budget on paying people not to work and subsidizing the Hamas government in Gaza, or its international donors will finally close the spigot. 2012-09-21 00:00:00Full Article
PA's Fiscal Crisis Due to Gaza, Not Israel
(Commentary) Evelyn Gordon - The World Bank issued another report on the Palestinian economy, blaming Israel, but the truth is the PA hasn't a prayer of ever resolving its fiscal crisis without addressing the real elephant in the room: Gaza. According to PA Prime Minister Salam Fayyad, Gaza accounts for 48% of the PA's expenditures, while revenues received from Gaza are a mere 4% of the PA's budget. Nothing Israel does will be able to compensate for that. Because Hamas controls Gaza, the PA can't collect taxes there - and Hamas has no interest in giving the PA any of the taxes it collects. After the EU stopped paying for Gaza's electricity in 2010, the PA picked up the tab. Five years after Hamas took over Gaza, the PA is still paying 60,000 former PA employees full salaries to sit at home and do nothing. The PA's international donors are slated to meet on Sep. 23. If they really want to solve the PA's fiscal crisis, they need to issue an ultimatum: Either the PA stops blowing half its budget on paying people not to work and subsidizing the Hamas government in Gaza, or its international donors will finally close the spigot. 2012-09-21 00:00:00Full Article
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