Arafat's Billions

By The New York Sun | by Dr. Rachel Ehrenfeld, ACD Director
Friday, July 23rd, 2004 @ 4:58AM

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The news about Yasser Arafat’s demise still proves to be premature. As long as the official Palestinian Authority daily Al Hayat Al Jadida calls for “a bloodless overthrow, which Yasser Arafat will execute against Arafat Yasser,” and most other Palestinian papers continue to support him, he is free to demonstrate that despite tottering under the combined effects of the failure of the Intifada against the Israelis, the Bush administration’s disgust, the United Nations envoy Terje Roed-Larsen’s reprimand, and even the growing resentment of a large portion of the Palestinian population, he is still the boss and no changes or agreements regarding the Palestinians can be made without him. He is determined to maintain control over the situation because he can – he holds the keys to the vault.

Never mind the protests against his and his cronies’ corruption, nepotism, and the growing violence and chaos in the territories, and never mind the concession Mr. Arafat had to make in removing his cousin, Musa Arafat, whom he just appointed to head the Gaza Security Forces. Yasser Arafat’s control of the stolen wealth of the PLO and the Palestinian Authority enables him to continue to call the shots and shoot down, yet again, the prospect of a viable Palestinian state.

Jawad Ghussein, who was the secretary general of the Palestinian National Fund until 1996, remarked on the telephone from London, “The billions Arafat has stolen over the years from the Palestinian people facilitated the corruption of the Palestinian leadership, and is the source of his power over them.” He went on to say that Mr. Arafat “took aid money and contributions that were earmarked for the Palestinian people, to his own account.” Mr. Ghussein was in a position to know: for 12 years, he had deposited $7.5 million to $8 million each month into Mr. Arafat’s personal bank account.

The International Monetary Fund report “Economic Performance and Reforms under Conflict Conditions,” released in September 2003 in Abu Dhabi, concluded that $900 million in P.A. revenues from 69 commercial enterprises belonging to the P.A. in the West Bank, Gaza and abroad, “disappeared” between 1995 and 2000. The report also found that the 2003 budget for Arafat’s office, which totaled $74 million, was missing $34 million that Mr. Arafat had transferred to pay unidentified “organizations” and “individuals.” Furthermore, the report revealed that at least 8% – $135 million – of the P.A.’s annual budget of $1.08 billion is being spent by Mr. Arafat at his sole discretion. However, the IMF report did not take into account Mr. Arafat’s control of 60% of the security-apparatus budget, which leaves him with at least additional $360 million a year to spend as he chooses.

This report was followed by news that in the period between July 2002 and September 2003 Mr. Arafat transferred $11.4 million to his wife, Suha’s French bank accounts. But recent information reveals that in 1996, Mrs. Arafat arrived in Buenos Aires with $30 million in cash that she invested in a business with other Palestinians.

As of August 2002, Mr. Arafat’s personal holdings also included $500 million of the PLO’s money; in all, his holdings were reported at that time, to total $1.3 billion. This money is enough to (a) feed 3 million Palestinians for 1 year, (b) buy 1,000 mobile intensive care units, (c) fund 10 hospitals for a decade, and (d) would still leave $585 million to fund other social projects.

Where does the money that Mr. Arafat steals, originate from? At least 60% of the P.A.’s budget comes from international aid contributions, of which the European Union is the largest donor. According to the Palestinian Ministry of Planning and International Corporation, individual E.U. member states have donated at least $1.3 billion to the P.A. Altogether, aid from Europe – including E.U. donations – from 1998 to 2001, has totaled at least $4 billion. In total, 10% of the E.U.’s overseas aid has been donated to the Palestinians alone. In addition, on May 27, 2004, the English announced a £26.5 million aid package, to be transferred directly to the P.A.

Saudi contributions, until 2003, amounted to $15.4 million every two months. Last December, while attacks against Israel continued, America, Japan, the E.U., and Norway, joined by the Arab League countries and the IMF approved another $1.2 billion to the P.A. for the 2004 budget. At the same time, the World Bank granted it $15 million, and the E.U. gave $40 million more in assistance to the PA for “reforms and emergency economic aid.” While America’s annual gift to the Palestinians increased from $100 million to $213 million.

An additional $223 million was returned recently by Israel to the P.A. in sales taxes for the year 2003. Last February, Congress was supposed to hold hearings about Mr. Arafat’s and the P.A.’s corruption, but at the last minute the hearings were cancelled. Had these hearings been held, the Palestinian people and the world could have learned about the extent of Mr. Arafat’s corruption of the political leadership as well as that of the Palestinian society. Had that happened, it is conceivable that a few courageous reform-seeking Palestinians would have found the justification to finally overthrow Mr. Arafat and his corrupt regime.

The demonstrations in Gaza and the West Bank may be signaling that Mr. Arafat’s days are numbered. But since he still holds the purse strings, it is unlikely that he will be overthrown anytime soon. Instead, his Fatah movement, assisted by Hezbollah is busy planning mega homicide bombing in Israel – one was foiled earlier this week.

In reaction to what seems like a timely opportunity for finally removing Mr. Arafat, Secretary of State Powell said, “We believe the correct path forward involves Mr. Arafat yielding power, real executive power, to a prime minister for that prime minister to do what is needed for the Palestinian community.” Is this all the secretary can say to encourage the desired regime-change?

Rachel Ehrenfeld is the author of “Funding Evil: How Terrorism is Financed and How to Stop It” and is the director of the American Center for Democracy.


Categories: Anti-Corruption, Terrorist Financing

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