PALESTINIAN POLITICAL FIGURES ON SALARIES,

C O N F I D E N T I A L JERUSALEM 001850

SIPDIS

SIPDIS

NEA FOR FRONT OFFICE AND IPA; NSC FOR ABRAMS/DORAN/LOGERFO

E.O. 12958: DECL: 05/09/2016
TAGS: PREL KPAL KWBG
SUBJECT: PALESTINIAN POLITICAL FIGURES ON SALARIES,
HAMAS-FATAH RELATIONS, AND NATIONAL DIALOGUE

REF: A. JERUSALEM 1824

B. OSC GMP 20060504620004 RAMALLAH AL-AYYAM 4 MAY 06

Classified By: Consul General Jake Walles. Reasons: 1.4 (b) and (d).

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Summary
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1. (C) Presidential Advisor Akram Hanniyyah and PLC member
Salam Fayyad commented to Consul General in separate May 9
meetings that the payment of PA salaries is a critical issue.
Hanniyyah pressed for immediate disbursement of the USD 70
million in Cairo, saying it would shift the press story from
US blocking bank transfers to Hamas' inability to govern,
once those donations were expended. By contrast, Fayyad
thought that any movement on salaries now would let Hamas off
the hook and was ill-advised. Akram Hanniyyah recounted in
detail the recent stormy meetings between President Mahmoud
Abbas (Abu Mazen) and Prime Minister Ismael Hanniyyah, saying
that Abu Mazen had been extremely critical and had turned
down all Hamas proposals. According to Akram Hanniyyah, Hamas
signaled interest in a NUG, but Abu Mazen was firm in saying
that no progress could be made if Hamas still headed the
government. Both Fayyad and Akram Hanniyyah lauded a May 4
article by Fayyad on the background of the current economic
situation, saying it had not been met by any effective Hamas
response; Fayyad intends to follow the article up with more
articles and television appearances. Neither Akram Hanniyyah
nor Fayyad are optimistic about the prospects for a National
Dialogue.

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Paying PA Salaries
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2. (C) Akram Hanniyyah made a strong pitch for transferring
the USD 70 million in Arab League coffers to the PA. He said
that, as a newspaperman, the story of the US blocking the
transfer of funds to pay salaries for Palestinian civil
servants is only helping Hamas. As a practical measure, he
observed that Hamas would deplete the funds within days and
would then would no longer have the excuse of saying salaries
were not being paid because of blocked bank transfers -
instead, the story would shift to Hamas' inability to attract
donors because of their political positions. Consul General
took note of his comments, but pointed out that setting a
precedent of transferring funds to pay salaries could quickly
lead to more donations and thereby enable Hamas to govern
without fulfilling the conditions laid out by Abu Mazen and
the Quartet.


3. (C) Fayyad was scathing about European pressure to pay
salaries: "let them go ahead and pay," he commented
ironically. He observed that the French had only donated
$3.3 million in 7 years, the British $10-12 million over 10
years, and that European donations had largely dried up.
Fayyad thought the timing of European interest in paying
some salaries was "unfortunate," as Hamas is only now
beginning to feel financial pressure. He also thought it
important for the Quartet to avoid giving any signals that
its position on Hamas is weakening.

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Hamas-Fatah Friction Points
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4. (C) Akram Hanniyyah said the meeting between Abu Mazen and
Prime Minister Hanniyyah on May 6 had been stormy, with
presidential advisors Rafiq Husseini and Rawhi Fattouh having
to intervene with Abu Mazen in an effort to calm the
President down. The Prime Minister pressed for the naming of
deputy ministers and directors general in the ministries; Abu
Mazen refused. Abu Mazen rebuked Sayyid Siam for his
creation of a special force in Gaza, saying the Interior
Minister should instead use regular hiring procedures. The
Prime Minister asked that the President take ministers along
when he made foreign trips; Abu Mazen refused, saying that
foreign countries would not meet with Hamas ministers. Abu
Mazen took the Prime Minister to task for comments he had
made in recent Friday sermons and, overall, reportedly spoke
for 2.5 hours in the 3.5 hour meeting. A follow-on
"technical" meeting of teams headed by lower level officials
discussed a range of issues such as the security forces and
personnel appointments, but reached no conclusions.


5. (C) Akram Hanniyyah observed growing splits among Hamas
leaders, with the limelight leaving the Damascus Hamas
leadership and instead turning toward elected Hamas leaders

such as the Prime Minister. Hanniyyah also detected splits
between the West Bank and Gaza Hamas leaders, observing that
the population of the West Bank is more sophisticated than
Gaza, resulting in tougher questions and more nuanced replies
from Hamas West Bank leaders. Hanniyyah said that Hamas
leaders are signaling interest in a National Unity Government
(NUG),and that Abu Mazen had been firm in his replies: a
NUG would not work with Hamas in charge. Hanniyyah thought
that private sector political initiatives such as that of
Munib Masri (ref a) were helpful, but warned that Hamas would
not give up power easily and that Iran and Syria would take
steps to sabotage any such moves. He expressed concern about
keeping Hamas-Fatah confrontations peaceful, alluding to
clashes in Gaza on May 8 and 9. He underscored the
criticality of supporting Abu Mazen, saying there was no
"number 2" in this situation. In the current political
circumstances, Fatah's fate was tied to Abu Mazen far more
than it ever had been tied to Yassir Arafat.

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Salam Fayyad Article
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6. (C) Fayyad believed his May 4 article debunking Hamas'
accusations and laying out the real reasons for the current
economic situation had been well received (text in ref (b)).
He planned to continue building on its themes in follow-on
articles and television appearances. Akram Hanniyyah was
highly complimentary of Fayyad's article, saying reactions
had been very positive and noting Hamas had not mustered any
effective response. He looked forward to Fayyad appearing on
local TV throughout Palestinian areas.

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National Dialogue
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7. (C) Hanniyyah was not optimistic that the Hamas-Fatah
National Dialogue, currently scheduled to begin on May 23,
would actually take place. Touching on intra-Hamas dynamics,
he observed that the Dialogue would showcase Hamas leaders
from Gaza and the West Bank to the exclusion of those based
in Damascus. He was also concerned about an outsized role
for factions, and thought it would be preferable to balance
that with more participation by members of civil society.
Fayyad was similarly pessimistic, saying he would participate
in preparations for the Dialogue, but questioned whether it
would occur.

WALLES