RAMALLAH, West Bank, Jan 12 (KATAKAMI / Reuters) – The Palestinian Authority’s dependence on foreign aid will drop to less than $1 billion in 2011, from $1.2 billion in 2010, Prime Minister Salam Fayyad said on Wednesday. Fayyad, a former World Bank economist, has reduced the territory’s annual dependence on international aid from around $2 billion since he took office in 2007. He wants to do away with foreign aid completely by 2013.
Financial support from the United States, the European Union and Arab states allows the Palestinian Authority to pay the salaries of around 150,000 bureaucrats, teachers and members of the Palestinian security forces.
“We expect that a deficit in this range (of less than $1 billion) … will be within the framework of what it is possible for the donors to finance,” he said.
Norwegian Foreign Minister Jonas Gahr Stoere, head of an international committee that oversees aid to the PA, praised Fayyad for lowering the foreign aid requirement. He was speaking alongside Fayyad at a news conference in Ramallah.
“I am looking forward to the day when I will stop any aid to the Palestinian Authority because I know that if this Palestinian economy will be run like any other economy it will do without aid,” he said.
The Palestinian Authority faced a financial crisis last year due to late payment of funds expected from its Arab backers. The crisis was eventually eased thanks to payments from states including Saudi Arabia and the United Arab Emirates. (*)