A Palestinian investment fund that controls hundreds of millions of dollars will remain under the control of President Mahmoud Abbas, a senior aide said Friday — a move that would deny Hamas access to the money after they take control of parliament next week.
In another measure to consolidate his power before the Hamas government is installed, Abbas plans to set up a new presidential agency to oversee border crossings between the Palestinians and Israel, according to Palestinian legislator Saeb Erekat, who said he has been designated the agency's chief. The agency's purpose would be to settle border disputes with Israel that might keep the crossings closed, Erekat said.
On Friday, Secretary of State Condoleezza Rice called Abbas, Israeli Foreign Minister Tzipi Livni and Israel Defense Minister Shaul Mofaz to discuss working together to keep the border between Israel and Palestinian areas open, State Department spokesman Adam Ereli said in Washington.
Hamas' victory in Jan. 25 parliamentary elections provoked Western threats to isolate the Palestinian government unless its new leaders abandon their call for Israel's destruction. Abbas, elected separately last year on a platform of making peace with Israel, hopes to serve as an alternate conduit for international ties, and in recent weeks has taken several steps to shore up his power.
His predecessor, Yasser Arafat, set up the investment fund in 2000 to calm an international outcry over a crony's diversion of hundreds of millions of dollars from the Palestinian treasury. Arafat appointed his reformist finance minister, Salam Fayyad, to invest the money on behalf of the Palestinian Authority, but after Fayyad resigned to run for parliament in January, then-Prime Minister Ahmed Qureia took over the fund.
With the new Hamas Cabinet set to be sworn in on Thursday, Abbas intends to keep the fund under his office, a senior aide to the Palestinian leader said on condition of anonymity because no official action had been taken yet.
It is not clear how much money is in the fund. An international audit in early 2005 said investments had brought the $900 million fund to $1.4 billion, but the Palestinian Authority has dipped into it to pay for ongoing expenses.
Abbas' control of the money would make financial matters even worse for the militants as they take over a government that has survived, in part, on international aid for its 12-year existence. The cash flow is expected to get tighter after Hamas takes power, because Western nations have threatened to withhold hundreds of millions of dollars in aid unless the group changes its violent ways.
Abbas' plan to set up a border crossings agency would be another power play. The crossings have so far been managed by the Ministry of Civil Affairs, which will now be run by the incoming Hamas government.
Israel has kept the Gaza Strip's main cargo crossing closed for most of the year, citing security threats. Palestinians claim they are being punished for Hamas' electoral victory, and until recently, rejected Israel's offer of alternate crossings while the Karni passage is closed.
Another main crossing, between Gaza and Egypt, is run by the Palestinians, with European Union inspectors, who might prefer to deal with officials close to Abbas, rather than with Hamas. A presidential decree to establish the agency is sitting on Abbas' desk, but he has not yet signed it, said his aide. Abbas is attending an Arab summit in Khartoum, Sudan, and is expected back in the West Bank next week.
An agreement on Gaza border crossings, brokered in November by Rice, was seen as a major step toward refueling the Palestinian economy, devastated by nearly five years of fighting with Israel. But the agreement, signed shortly after Israel pulled out of Gaza, has foundered, as have hopes that the Israeli withdrawal would lend momentum to restart long-stalled peace talks between Israel and the Palestinians.
AP correspondent Ibrahim Barzak contributed to this report from Khartoum, Sudan.