Will Palestinian private sector rescue national economy?
Business owners are trying to launch an initiative to lend the financially struggling Palestinian Authority as much as $200 million, but this effort has yet to take shape.
RAMALLAH, West Bank — Some Palestinian business owners hope to help the Palestinian Authority (PA) out of its critical financial jam by putting together a loan of $150 million to $200 million for the next three months.
On July 4, the PA used bank loans to disburse 60% of the June salaries of government employees amid its ongoing financial crisis. It has been paying only partial salaries for months.
The crisis started Feb. 19, when the PA refused to accept Israel's transfer of the monthly tax revenue funds deducted by 42 million shekels ($11.7 million), which is the amount that the PA pays as stipends for Palestinian prisoners in Israeli jails and the families of Palestinian victims killed or wounded in confrontations with Israel.
Five months into its financial crunch, the PA had to borrow from local banks, request assistance from the Arab Financial Safety Net of the Arab League, apply for loans from other Arab countries and rely on local revenues to pay employees’ wages.
