By Micah Halpern
I've Been Thinking:
The most important decision to emerge from the recent Arab summit is that they - Arab countries - will provide the Palestinian Authority with $100 million per month.
It is all the result of the UN vote which changed Palestinian status to that of observer state from organization.
Now, Arab countries are stepping forward with commitments.
According to World Bank figures, the PA actually needs $243 million per month. They will get $100 million from taxes collected by Israel. But that still leaves a serious deficit. The vast majority of PA costs go to paying their 153,000 civil servants.
The $43 million difference must be made up by taxes. And so far, the PA has failed miserably at collecting taxes. For that matter, they have failed at almost every element in the bureaucratic infrastructure that is the foundation of government.
The $100 million from Arab countries is a very important injection into their economy but - despite the promises, very seldom do Arab countries honor their pledges, especially to the PA. And if they do, the money never gets there on time.
And then there are the questions of who will be collecting money and how will it be transferred? These are some of the questions left unanswered at the summit.
Getting aid is fine, but the bigger problem facing the Palestinian Authority is building an economy - an economy that can sustain itself so that it does not have to live on the dole.
Micah@MicahHalpern.com
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