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Minister: PA will borrow from banks if necessary
Published Tuesday 12/06/2012 (updated) 21/06/2012 10:51
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File photo of economy minister
Jawad Naji.
(MaanImages/Khaleel Reash)
BETHLEHEM (Ma'an) -- The Palestinian Authority will start talks with the private sector, and still has bank funds available to cover its financial crisis, the newly-appointed PA minister of economy Jawad Naji said Monday.

The Palestinian Monetary Authority chief Jihad al-Wazir said Sunday the PA had reached its maximum limit for bank borrowing. But the minister told Ma'an: "If we need, we will borrow from banks to pay salaries."

"In fact there are deposits and cash which we haven’t used so far," Naji continued.

The minister assured that public sector staff salaries would be paid on time in the coming months, while underlining the seriousness of the crisis and urging Arab and international donor to fulfill aid pledges to the PA.

The IMF says the aid-dependent Palestinian economy has entered a "difficult phase" with a severe liquidity crunch worsening since last year due to a drop in aid from Western backers and wealthy Gulf states and Israeli restrictions on trade.

PA Prime Minister Salam Fayyad said in January that his government owed $1.1 billion in bank loans, as well as $400 million in unpaid revenues to private sector contractors.

Naji said the government would start talks with the private sector in two weeks, reactivating a committee formed in 2010 to set a comprehensive private and public sector strategy.

But Chief Executive of PADICO investment company Samir Hleilah stressed to Ma'an that private sector talks with the government, launched earlier this year, had failed to find a consensus.

"Previous talks have stopped and an agreement was reached that taxation should be determined by the president or the Palestinian Legislative Council not the government. Other than that, nothing has been agreed on," he said.

Talks, he said, should focus on a financial strategy discussing the PA’s economic policies rather than the deficit.

The Palestinian Authority is bigger than its economy, and so the PA itself should be restructured reconsidering expenses, Hleilah said.

The Gaza Strip and Palestinians in the Diaspora should also take responsibilities, he added.

Meanwhile the economy minister said no Palestinian Investment Conference was planned for 2012, and said he would prefer a national conference to individual events in each district. An investment conference is scheduled to be held in northern West Bank governorate Tulkarem in July.
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1 ) Tibi / Tubas
13/06/2012 01:13
The "PA will borrow from banks" with WHAT COLLATERAL, and banks may NOT accept international donation promises !!

2 ) shirley / australia
13/06/2012 15:03
nothing will ever cahnge until PA PLO go to UNGA and lock in full observer state Isreal is constantly destroying all iniatives and costing millions and destroiying pAL economy deliberate with damage constant from settlers and unable to build a long term vibrant economy while this occupation continues and PA must move pal state forward and start real pressure and after lock in demand Peace keepers and sanctions UNESCO vote alone not enough US isreal does not recognize pals must build on this

3 ) Tobias / USA
15/06/2012 15:41
The Bank of Israel will give them a loan, but the collateral will
probably be the disputed territory beneath the West Banks Area C.

4 ) Jeffrey / UK
19/06/2012 15:49
The PA is going down the same route as some Eurozone countries in spending money that it does not have. Unlike the Eurozone, the PA is largely living on the the international equivalent of welfare. Welfare recipients are currently under pressure from the governments that pay them. These governments should insist that there will be no more money unless the PA starts meaningful unconditional peace talks with Israel. Also, the money given must be used properly not siphoned off by corrupt leaders.

5 ) Mel / USA
19/06/2012 17:13
OOO! What a "good" idea? Borrow from USFed,Goldman Sachs,JP Morgan,the IMF,World Bank et al? The same fiscal terrorists who've destroyed US/UK/EUC economics & landed the masses,in another USUROUS global depression post corrupt-capitalist LOOTING & pillaging! The freshly-printed,PONZI,money U borrow,just comes at MASSIVE HUMAN COST/SACRIFICE. But hey?You could ASK for a free new pair of Nikes,with the orange shackle&chain round your ankles,to look cool in your corrupted SHEKEL SERVITUDE?!? Jeeez!

6 ) Yasser's Ghost / French Riviara
23/06/2012 18:50
Why not do like Hamas. Go to the bank with guns and rob it. And no need to pay interest. No problemo!
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