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Donor Nations Pledge $2 Billion in Assistance for the Palestinians

World leaders, including U.S., Israeli and Palestinian officials, joined together in a historic conference here last week to pledge $2 billion in economic aid for Palestinians in the West Bank and Gaza Strip.

The International Conference to Support Middle East Peace, held at the State Department last Friday, was convened by the United States and Russia to help implement the landmark Israeli- Palestinian accord signed at the White House last month and to encourage further steps toward peace throughout the Middle East.

Forty-six delegations arrived at the State Department for the donors conference Friday morning, and the pledges soon began pouring in. In the end, the conference raised $2 billion covering a five-year period, including $1 billion for the first two years and as much as $600 million for the first year.

The World Bank estimates that the Palestinians will need $2.4 billion over the next five years, and Treasury Secretary Lloyd Bentsen said Friday he was “confident” that figure would be exceeded.

Some nations, surprised by the fast pace of the Middle East peace process in recent weeks, have yet to announce their pledges.

Among the donors, the United States offered $500 million over the next five years, Japan $200 million over two years and Saudi Arabia $100 million in 1994.

Israel pledged $25 million in grants and $50 million in credits “over the coming years.”

Organized in a short time and occurring just two weeks after the Sept. 13 signing ceremony, the conference still had loose ends to tie up.

For example, it was still unclear what percentage of the donations would be in the form of loans and what percentage in the form of grants.

GORE DECRIES ARAB BOYCOTT

U.S. officials said Friday that the American contribution would consist of about 75 percent grants in the first year, during which time the Palestinians would be settling such basic economic issues as paying teachers’ salaries.

Then, in later years, as the Palestinians began emphasizing investment issues, the percentage of loans would increase.

The World Bank will serve as a sort of secretariat, coordinating the activities of the donors on a day-to-day basis.

In addition, there will be an ad-hoc liaison group that will meet every three to six months to coordinate among donors. Its members will include the United States, Canada, the European Community, Japan, Russia, Norway and Saudi Arabia.

Israel, the Palestinians, Egypt and Jordan will serve as associate members of the group.

The Palestinians have created an organization to serve as the recipient and organizer of the funds. Palestinian officials said Friday that the group would include Palestinian economists, lawyers and business leaders.

One issue that arose at the conference was the continuing Arab economic boycott against Israel.

Vice President A1 Gore, in his remarks to the conference Friday morning, said that vestiges of the past, such as the boycott, “have no place in a world seeking peace.”

But at a news conference later Friday, Palestine Liberation Organization official Yasser Abed Rabbo suggested that the Arabs might not lift the boycott until such issues as the status of Jerusalem are resolved.

The touchy question of Jerusalem, a city claimed by both Israelis and Palestinians, is scheduled to be dealt with in the so-called “final status” negotiations following the current interim phase of Israeli-Palestinian negotiations.

Speaking with reporters in New York on Sunday, Israeli Foreign Minister Shimon Peres dismissed the hard-line statements regarding the boycott, saying they were geared for domestic Arab consumption.

“The time has come to pay attention to the deeds, not to the words,” he said.

“I wish we’d let some of their words pass, without an Israeli reaction. They’re fighting their own battle.”

(Contributing to this report was JTA staff writer Larry Yudelson in New York.)

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