Israel prevents Abbas from bringing cash to Gaza

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By Adam Entous

 

JERUSALEM (Reuters) – Israel is preventing the Western-backed Palestinian Authority from transferring cash to the Gaza Strip to pay its workers and others hard-hit by war, Western and Palestinian officials said on Wednesday.

 

The restrictions threatened to undercut the ability of President Mahmoud Abbas’s West Bank-based government to reassert a presence in the Hamas-ruled territory after Israel’s 22-day offensive, said the officials, who asked not to be identified.

 

The cash restrictions also underscored the wider hurdles facing reconstruction, estimated to cost more than $2 billion, in the Gaza Strip, where 1.5 million Palestinians live.

 

Israel has told the United Nations and other aid groups planning for the rebuilding they must apply for project-by-project Israeli approval and provide guarantees none of the work will benefit Hamas.

 

Israel had no immediate comment on why the Palestinian Authority’s post-war cash shipments were being blocked. The restrictions were put in place long before fighting broke out on December 27, with Israel arguing that Gaza had enough cash in circulation and that some of the money could end up with Hamas.

 

Middle East envoy Tony Blair, the International Monetary Fund and the World Bank countered that the restrictions were crippling Gaza’s economy and undermining the Palestinian Authority, which adopted anti-money laundering rules to prevent any of the money from going to Hamas and other groups.

 

It is unclear how Gaza’s reconstruction will be handled. “It’s a Pandora’s box,” one senior diplomat said, citing the restrictions imposed by Israel and the international community.

 

Western powers consider Hamas a “terrorist” organization and refuse to transfer money directly to the group or its government in the Gaza Strip. But the Palestinian Authority has had little presence in the coastal territory since Hamas routed Abbas’s secular Fatah faction and seized control in June 2007.

 

Reconstruction largely hinges on convincing Israel to lift restrictions on imports of cash and building materials, like steel and cement. Israel has long argued that such imports can be used by the Islamist group to rearm.

 

“The Gaza Strip was almost destroyed and it needs everything,” said Nabil al-Zaeem, head of the Palestinian Commercial Service Co., one of Gaza’s largest cement importers.

 

He said rebuilding will not happen “if things did not change regarding the flow of cement and other construction materials.”

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