Israel is considering unblocking two billion shekels ($400 million) in Palestinian Authority taxes and customs revenues frozen by the Jewish state during the conflict, an Israeli official said today.
The move was discussed by Israeli Foreign Minister Shimon Peres and the new Palestinian finance minister, Mr Salam Fayad, in their first meeting on Monday, as a possible way to tackle the economic crisis in the Palestinian territories, the official said.
"We are considering this move, but it has not been finalised, there is no agreement," said the official, who asked not to be named.
He said both sides were positive about the move, but said Israel was examining ways of establishing a mechanism to ensure that the money was not siphoned off to back militant groups or to pay Palestinian security forces also involved in attacking Israelis.
"It was at the request of the Palestinians, but it is to the benefit of both sides to see the Palestinian economy recover. But on the other hand, we want to be sure that the money does not serve other purposes, like terrorism, either directly or indirectly," said the official.
"It's not our money, it's their money," he added.
The money, largely customs duties collected on goods being shipped into the Palestinian territories through Israeli ports, has been frozen since the Palestinian uprising, or intifada, began in September 2000.
Israeli Prime Minister Ariel Sharon has said he is seeking ways to relieve the harsh conditions that almost two years of violence have created in the Palestinian territories, and which has been exacerbated since Israel invaded the West Bank three weeks ago.
AFP