Identifier
Created
Classification
Origin
09RIYADH1300
2009-09-30 15:09:00
CONFIDENTIAL
Embassy Riyadh
Cable title:
SAUDI FUND DISCUSSES GAZA RECONSTRUCTION
how-toVZCZCXRO8147 PP RUEHROV DE RUEHRH #1300 2731509 ZNY CCCCC ZZH P 301509Z SEP 09 FM AMEMBASSY RIYADH TO RUEHC/SECSTATE WASHDC PRIORITY 1630 INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY RUEATRS/DEPT OF TREASURY WASHDC PRIORITY RUEAIIA/CIA WASHDC PRIORITY RUEKDIA/DIA WASHINGTON DC PRIORITY RHEHNSC/NSC WASHDC PRIORITY RUMICEA/USCINCCENT INTEL CEN MACDILL AFB FL PRIORITY
C O N F I D E N T I A L RIYADH 001300
SIPDIS
DEPT FOR SPECIAL ENVOY MITCHELL, NEA/IPA, NEA/ARP, NEA
FRONT OFFICE
E.O. 12958: DECL: 10/01/2019
TAGS: EAID KWBG PREL SA IS
SUBJECT: SAUDI FUND DISCUSSES GAZA RECONSTRUCTION
Classified By: Deputy Chief of Mission Susan L. Ziadeh for reasons 1.4
(b) and (d)
Summary
-------
C O N F I D E N T I A L RIYADH 001300
SIPDIS
DEPT FOR SPECIAL ENVOY MITCHELL, NEA/IPA, NEA/ARP, NEA
FRONT OFFICE
E.O. 12958: DECL: 10/01/2019
TAGS: EAID KWBG PREL SA IS
SUBJECT: SAUDI FUND DISCUSSES GAZA RECONSTRUCTION
Classified By: Deputy Chief of Mission Susan L. Ziadeh for reasons 1.4
(b) and (d)
Summary
--------------
1. (C) The GCC recently settled on a mechanism for providing
Gaza with the roughly $1.6 billion in aid that GCC countries
pledged for reconstruction efforts in January. They will
start with a first tranche of projects worth $160 million
which will be selected in late October. The money for these
projects will be channeled through the Islamic Development
Bank to various partners, including UNRWA. End summary.
Better Late than Never
--------------
1. (C) On September 29, Econoff met with Muhammed Al-Namlah,
the Saudi Fund for Development's (SFD) chief engineer for
Gaza reconstruction issues to discuss how (and when) the
Saudis intend to spend the $1 billion they pledged for Gaza
in January. Al-Namlah said that none of the pledge has been
spent to date, although the Gulf Cooperation Council (GCC)
did settle on a mechanism for how to spend the money at a
meeting on September 5. They will fund up to $160 million in
projects (10 percent of total Gulf commitments),which they
will select at an October 26 meeting. The committee
selecting these projects is chaired by Yousef Al-Bassam, the
managing director of the SFD (by virtue of the SAG's
contribution being the largest),and with his Qatari
counterpart serving as the deputy chair.
2. (C) According to Al-Namlah, the GCC contributions will be
deposited in a single program account at the Islamic
Development Bank (IDB). IDB will disperse money for projects
approved by the selection committee. Al-Namlah expects many
of the projects will be administered by traditional partners,
including UNRWA and the IDB itself, but said that all
contributing countries will share in oversight of how the
money is spent. Projects selected for the initial $160
million tranche will try to utilize materials already
available in Gaza due to continuing difficulties bringing
sufficient construction materials across the border. Due
primarily to these difficulties, Al-Namlah was skeptical that
the full $160 million would be spent in the near future.
Al-Namlah said the IDB has historically worked with the
Palestinian Authority (PA) to implement projects.
SFD Mechanics
--------------
3. (C) Al-Namlah explained SFD implementing mechanisms,
noting the SFD does not work with the PA due to internal
regulations barring them from giving money to government
entities. He further said the SFD prefers to pay contractors
directly as it gives them more control over how the money is
spent and provides them with the option to limit payment in
the event that the work is substandard. The SFD will provide
a contractor with an advance of up to 20 percent of the
project cost once the contractor has secured a bank guarantee.
Budget Support Mechanism
--------------
4. (C) When asked about the SAG's recent $200 million
contribution to the PA's budget, Al-Namlah said this type of
extra contribution (i.e. outside of Arab League channels)
does pass through SFD and that it was sent at the end of
August.
Comment
--------------
5. (C) There has been no indication when the GCC or the SAG
intend to spend the remaining funds pledged to Gaza
reconstruction, $900 million in the case of the Kingdom.
SMITH
SIPDIS
DEPT FOR SPECIAL ENVOY MITCHELL, NEA/IPA, NEA/ARP, NEA
FRONT OFFICE
E.O. 12958: DECL: 10/01/2019
TAGS: EAID KWBG PREL SA IS
SUBJECT: SAUDI FUND DISCUSSES GAZA RECONSTRUCTION
Classified By: Deputy Chief of Mission Susan L. Ziadeh for reasons 1.4
(b) and (d)
Summary
--------------
1. (C) The GCC recently settled on a mechanism for providing
Gaza with the roughly $1.6 billion in aid that GCC countries
pledged for reconstruction efforts in January. They will
start with a first tranche of projects worth $160 million
which will be selected in late October. The money for these
projects will be channeled through the Islamic Development
Bank to various partners, including UNRWA. End summary.
Better Late than Never
--------------
1. (C) On September 29, Econoff met with Muhammed Al-Namlah,
the Saudi Fund for Development's (SFD) chief engineer for
Gaza reconstruction issues to discuss how (and when) the
Saudis intend to spend the $1 billion they pledged for Gaza
in January. Al-Namlah said that none of the pledge has been
spent to date, although the Gulf Cooperation Council (GCC)
did settle on a mechanism for how to spend the money at a
meeting on September 5. They will fund up to $160 million in
projects (10 percent of total Gulf commitments),which they
will select at an October 26 meeting. The committee
selecting these projects is chaired by Yousef Al-Bassam, the
managing director of the SFD (by virtue of the SAG's
contribution being the largest),and with his Qatari
counterpart serving as the deputy chair.
2. (C) According to Al-Namlah, the GCC contributions will be
deposited in a single program account at the Islamic
Development Bank (IDB). IDB will disperse money for projects
approved by the selection committee. Al-Namlah expects many
of the projects will be administered by traditional partners,
including UNRWA and the IDB itself, but said that all
contributing countries will share in oversight of how the
money is spent. Projects selected for the initial $160
million tranche will try to utilize materials already
available in Gaza due to continuing difficulties bringing
sufficient construction materials across the border. Due
primarily to these difficulties, Al-Namlah was skeptical that
the full $160 million would be spent in the near future.
Al-Namlah said the IDB has historically worked with the
Palestinian Authority (PA) to implement projects.
SFD Mechanics
--------------
3. (C) Al-Namlah explained SFD implementing mechanisms,
noting the SFD does not work with the PA due to internal
regulations barring them from giving money to government
entities. He further said the SFD prefers to pay contractors
directly as it gives them more control over how the money is
spent and provides them with the option to limit payment in
the event that the work is substandard. The SFD will provide
a contractor with an advance of up to 20 percent of the
project cost once the contractor has secured a bank guarantee.
Budget Support Mechanism
--------------
4. (C) When asked about the SAG's recent $200 million
contribution to the PA's budget, Al-Namlah said this type of
extra contribution (i.e. outside of Arab League channels)
does pass through SFD and that it was sent at the end of
August.
Comment
--------------
5. (C) There has been no indication when the GCC or the SAG
intend to spend the remaining funds pledged to Gaza
reconstruction, $900 million in the case of the Kingdom.
SMITH