Palestinian Authority reduces expenses by $45 million
Palestine, Economics, 9/24/1997

The Palestinian Finance Minister Mohammed Al Nashasheny said that the Palestinian Authority (PA) managed to reduce its current expenses by about $45 million through the austerity policy that it applied since the closure, which was imposed on the Palestinian self-rule areas two and half months ago. The closure encumbered the payment of employees' salaries.

Al Nashasheny stated that he will submit a complete report to the conference of the International Monetary Fund regarding the economic situation during the closure period. He confirmed that the austerity measures did not affect the salaries of the employees which the PA will continue to pay in a normal way.

The Palestinian Finance Minister asserted that the PA suffers from a financial crisis due to the fact the Israel froze the taxes and customs it was supposed to pay to the PA. Israel paid only one third of the amount, not 50% as it claims, accordint to Al Nashasheny, which caused many infrastructure projects to stop in the Palestinian self rule areas.

Regarding the procedures taken by the PA to counter the repercussions of the closure, Al Nashasheny said that the PA has tried to increase the trade agreements with Egypt and Jordan to boost trade exchange with them.

He added that the countries granting money to the PA offered $846 million out of $2.4 billion that these countries pledged to pay to the PA toward Palestinian infrastructure projects. Al Nashasheny told the granting countries that the PA managed to reduce the budget deficit from $120 million last year to less than $52 million this year, which he says proves that the PA is serious about applying the austerity policy.

Al Nashasheny disclosed that the granting countries gave only $10 million to reduce the budget deficit. He called upon these countries to pay the rest of money that they pledged to the PA in order to finish needed infrastructure projects.

Previous Stories:
  Palestinian losses due to Israeli blockade at $2.55 billion   (9/8/1997)
  Palestinian Authority to set up Palestinian Electricity Company   (9/3/1997)
  Palestinian budget shortage doubled   (8/30/1997)

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