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Monday, December 17, 2007

Saudi Arabia doesn't consider PalArabs a good investment

The Independent (UK) notes:
Saudi Arabia has so far refused to commit to budget support for the emergency government set up by the Palestinian President Mahmoud Abbas, in a political move casting a shadow over Monday's international donors' conference in Paris.

The kingdom, along with the Gulf states which normally follow its lead, has declined ahead of the conference to promise around half the $1.4bn (£700m) a year needed to meet the Ramallah government's annual deficit, according to diplomatic and Palestinian sources. One key reason is thought to be Saudi Arabia's reluctance to be seen to be throwing all its weight behind one of the two parties to the coalition deal which it brokered and which then collapsed in bloody internal conflict and Hamas's seizure of control in Gaza in June.

The pro-Hamas IMEMC adds:
Of $421 million in support pledged by Arab nations for this year's Palestinian Authority budget, only $80 million has been delivered.
Arab nations have in the past pledged big and delivered little to their Pali brethren:
Many nations will be assembled at the Paris donor conference, but unfortunately the countries that could contribute the most -- the Gulf states -- have done the least. It will be interesting to see whether Paris marks a new departure for these countries. For all their statements on behalf of their Palestinian Arab brethren and how important the peace issue is to progress on other regional fronts, the Gulf Arabs have contributed very little financially to the Palestinians in recent years. According to World Bank officials, the annual Saudi contribution to the Palestinian Authority has been $84 million for most of this decade, while the other Gulf countries have given less or nothing at all. Despite their joint pledge of $660 million per year at an emergency Arab League summit in 2002, when oil prices were a fraction of what they are today, little has actually happened. Similarly, a Saudi promise last year to provide $300-$500 million was never fulfilled, according to U.S. and Arab officials.
The minute amount that Saudi Arabia gives is even more telling in light of its huge oil revenues. As the Washington Institute for Near East Policy notices:
The shortage of Gulf aid to the Palestinians certainly does not result from a lack of wealth, which has reached staggering proportions due to the quadrupling of oil prices since 2002. According to the U.S. Department of Energy and the IMF, oil revenue for the six Gulf Cooperation Council states (Saudi Arabia, Kuwait, the United Arab Emirates, Qatar, Oman, and Bahrain) should reach about $400 billion this year, half of it belonging to the Saudis. This would make their joint contribution to the Palestinians only 0.04 percent of their annual oil revenues. Adding to that wealth is their cumulative current account surplus since 2003, which will reach $700 billion this year.
And although this question is not meant to be rhetorical, it really is:
Do Gulf Arabs really think that the U.S. mortgage market and similar opportunities represent better investments than funding the economic infrastructure and future well being of the Palestinians, for whom they have campaigned for decades?
As Arabs who have watched the Palestinian Arabs whine and fritter away opportunities for peace and stability for decades, the Saudis know far better than the West how supremely bad an investment the Palis are. Money given to them has historically, invariably been thrown away. Decades of UNRWA aid as well as Western aid has not improved things one bit - their leaders still choose terror rather than peace, living in "camps" rather than permanent housing, and investing in weapons rather than infrastructure.

The Saudis know a bad investment when they see one. Too bad that today, in Paris, the West is likely to continue to throw out billions of dollars on a people whose leaders will use that money to fund death.

UPDATE:Treppenwitz has a great post on this topic.