PA DEPUTY FINANCE MINISTER CONFIRMS ISRAEL

C O N F I D E N T I A L SECTION 01 OF 02 JERUSALEM 000530 SIPDIS SIPDIS NEA FOR FRONT OFFICE; NEA/IPA FOR WILLIAMS/WATERS/LOGERFO; TREASURY FOR NUGENT/ADKINS E.O. 12958: DECL: 02/06/2016 TAGS: EFIN KBIO KWBG IS SUBJECT: PA DEPUTY FINANCE MINISTER CONFIRMS ISRAEL CLEARANCE REVENUE TRANSFER, STILL WAITING ON GULF FUNDING PLEDGES Classified By: Consul General Jake Walles for reasons 1.4 (b) and (d). ¶1. (C) Summary: Palestinian Authority Deputy Finance Minister Jihad al-Wazir confirmed that the Israeli clearance revenue transfer would appear in the PA's bank account February 7. He asked for USG assistance in obtaining letters from the Saudi and Qatari government by February 7 that noted that transfers of budget support from each of those governments were in process. Al-Wazir confirmed that PA President Abbas was on his way to Kuwait to seek USD 100 million in assistance. Al-Wazir voiced concern that Gulf governments would delay transfers until a Hamas delegation traveling in the region had visited. He noted how politically difficult that would be for President Abbas if transfers were delayed until Hamas could claim credit for them. End summary. Israel transfers clearance revenues -------------- ¶2. (C) Al-Wazir confirmed that the Israeli government had transferred the USD 54 M in clearance revenue it had collected on behalf of the PA. He said these funds would appear in the PA's single treasury account in the morning of February 7. He stressed, however, that those funds would not cover the PA's January payroll and other emergency expenses, so he was counting on receiving transfers from Gulf states. Increased Saudi transfer still awaiting King's approval -------------- ¶3. (C) Al-Wazir confirmed this afternoon that the Saudi transfer had still not arrived in the PA's account and that he had not received any indication that it was being processed. Al-Wazir did note that the PA had asked Saudi Arabia for USD 40 M, an increase from the USD 20 M discussed last week. Al-Wazir understood that this larger transfer had to be approved by the King. Al-Wazir asked for USG assistance in obtaining a letter from the Saudi government stating that funds were in the process of being transferred. Al-Wazir said he would use such a letter to obtain an advance from Arab Bank. According to earlier reports from al-Wazir, Arab Bank tried to call in a number of loans extended to the PA. February 7 is the final day that al-Wazir can get the financing lined up in order to pay PA salaries on Saturday, February 11, given that it takes 4 days for Arab Bank to process direct deposit salary payments. (Note: Al-Wazir believes that February 11 is the last day that the PA can pay January salaries before the public loses confidence in the PA and violence breaks out on the street. PA salaries were due to be paid February 4. End note.) Qatari transfer also outstanding -------------- ¶4. (C) Al-Wazir also asked for USG assistance in obtaining a similar letter from the Qatari government by February 7 since the Qatari transfer had not yet arrived. Al-Wazir noted that a Hamas delegation, currently in Cairo, is expected to be in Doha within the next day or so. He said that it would be a bad sign for President Abbas if the GOQ held the transfer until the Hamas delegation arrived in Doha since President Abbas had spoken with the Qatari Foreign Minister last week who had confirmed that the transfer was in the works. Abbas headed to Kuwait seeking USD 100 M; understand Emiratis not considering a transfer -------------- - ¶5. (C) Al-Wazir said that President Abbas was en route to JERUSALEM 00000530 002.2 OF 002 Jordan and was expected to arrive in Kuwait the evening of February 6. He would ask the Government of Kuwait (GOK) to make good on its USD 141 M in Arab summit pledges to the PA and would urge the GOK to quickly transfer at least USD 100 ¶M. Al-Wazir said that Abbas had no plans to go on to the Emirates since the PA had not received any indications that the Emiratis would be forthcoming with a transfer. Hamas says it can secure funding for PA through other channels -------------- ¶6. (C) Al-Wazir voiced concern that a Hamas delegation currently in Cairo would soon head to the Gulf seeking funding for the PA. Al-Wazir stressed that it would be politically difficult for President Abbas if Gulf states decided to wait on transferring funds until that delegation had visited. New PLC member Mohammed Abu Taeir was quoted by Arabic daily al-Quds February 6 as saying that Hamas could secure funding for the Palestinian people through other channels and PA personnel should not be concerned about their salaries under a Hamas-led government. He also referred to a USD 100 million pledge from an unnamed Arab donor. WALLES