- The Washington Times - Tuesday, July 1, 2003

The White House is weighing whether to resume direct financial aid to the Palestinian Authority, despite a three-year violent spree by Palestinian terrorist groups that has left hundreds of Israelis dead.

“We’ve made no decision about what level of potential increase in funds there would be,” White House spokesman Ari Fleischer said yesterday. “But the very fact we are involved in these discussions directly with the Palestinian Authority is a hopeful sign.”

Palestinians are scheduled to receive $200 million in U.S. funds this year, along with more than $1 billion the European Union and the Arab League provide directly to Yasser Arafat and the Palestinian Authority.

U.S. officials are considering an initial expenditure of $300 million, with the money going directly to the Palestinian Authority to deal with Hamas and other militant Palestinian groups responsible for terrorist attacks on Israelis. Much of the new money would go to help the Palestinians rebuild a splintered security force.

More important, the administration is considering rescinding its ban from providing money directly to the Palestinian Authority. Now, all U.S. aid goes through the United Nations and independent relief and nongovernmental organizations.

Mr. Fleischer said Congress, which must approve any policy change, realizes that “the circumstances have changed in the Palestinian Authority.”

The U.S. move is a sign that the Bush administration is satisfied with the performance of Palestinian Prime Minister Mahmoud Abbas, whom the White House has sought to make the de facto leader of the Palestinian Authority. President Bush marginalized Mr. Arafat last month when he met with Mr. Abbas and Israeli Prime Minister Ariel Sharon in a Red Sea summit designed to kick-start the administration’s “road map” to peace.

The United States bypassed Mr. Arafat because there was no way to be sure he did not use U.S. money to fund terrorist activities.

“This president would never provide money if he thought the same corrupt leaders would do with the money what they’ve done in the past,” Mr. Fleischer said.

Declaring that Mr. Abbas is ensuring U.S. money does not fall into the wrong hands, State Department spokesman Richard Boucher said: “The finances are under the stewardship of a new finance minister [Salam Fayyad] and now largely transparent and therefore accountable to the Palestinian people.”

In recent days, both Secretary of State Colin L. Powell and National Security Adviser Condoleezza Rice have praised Mr. Abbas. Mr. Powell called him the type of leader the Palestinian people should embrace; Miss Rice went to the Middle East last week to invite Mr. Abbas to meet with Mr. Bush in Washington.

A senior administration official said the new funding was presented to Palestinian and Israeli officials during Miss Rice’s visit.

On Sunday, Israeli forces pulled out of northern Gaza after leading Palestinian militant groups declared a three-month suspension of attacks on Israelis in breakthroughs for a U.S.-backed peace plan.

The administration hopes by increasing aid to the Palestinians for new roads, health care and other basic services, it may be able to reduce the influence of Hamas, which has attracted grass-roots support with a network of schools and welfare services that fills gaps left by inefficient Palestinian Authority institutions.

Mr. Bush has singled out Hamas as a major obstacle to the road map, which calls for confidence-building steps from both sides toward the goal of Palestinian statehood. Hamas and other groups have killed hundreds of Israelis in suicide bombings since the start in September 2000 of a Palestinian uprising for statehood.

In Jerusalem, Mr. Sharon and Mr. Abbas yesterday pledged to commit themselves to the peace process.

“We stand before a new opportunity for the possibility of a better future for both peoples. A future full of opportunities and hope is today closer than in the past,” said Mr. Sharon, standing beside Mr. Abbas in their first joint appearance from the holy city.

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