Politics and economics

The West must reignite efforts to send aid to the people of Palestine. Three months ago, 77% of Palestinians voted the Islamist organisation Hamas into power in Palestine. The people had spoken. Democracy had prevailed. There were celebrations on the streets of Ramallah.

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By  Anil Bhoyrul Published  April 23, 2006

Politics and economics|~||~||~|The West must reignite efforts to send aid to the people of Palestine. Three months ago, 77% of Palestinians voted the Islamist organisation Hamas into power in Palestine. The people had spoken. Democracy had prevailed. There were celebrations on the streets of Ramallah. Three months on, there is very little to cheer about. More than half of all Palestinians live on less than US$2 a day, and many of those very same people voted for Hamas because they believed it was the only way forward: not just politically, but economically. Unfortunately, though predictably, international aid for Palestine has all but evaporated. It is little surprise that the Palestinian Authority’s total debts are now above US$1.3 billion. Given that in 2005 the PA employed 140,000 people and had a monthly deficit of US$57.1 million, the situation is only likely to get worse. Current unemployment rates of 50% in some parts of Palestine are likely to soar. Last year, there was talk of a growing IT sector in Palestine. This has all but disappeared. The promise of a rising private sector remains a distant dream. Where do we go from here? Arab states, namely Saudi Arabia, Kuwait, the UAE and Qatar have pledged US$130 million, and even Iran is giving US$50 million. That is commendable but much more is needed. And that extra cash must come from the West. The US and the EU insisted they would cut off aid should Hamas come to power. The decision is reminiscent of the West attempting to cut off Iraq economically during the nineties – which only led to the complete devastation of the Iraqi economy. Even today, it has not recovered. It has long been proven that economic pressure does not change the politics of a region: in many cases, it only strengthens the resolve of those it is trying to break. The victims are always the same: the innocent hard working people trying to make a decent living. Well, no matter how hard you try, on US$2 a day you just can’t. The West must re-think its decision to cut off aid, and more importantly it must persuade Israel to hand over the US$60 million in tax receipts it has withheld. That money belongs to the PA. It is needed by the PA. And it is needed today. ||**||Question of sport|~||~||~|I am a big fan of Emirates Airline. Regular readers of this column will know that: I defy anyone to argue with its record profits and growth over the past few years, and its ever improving quality of service. There is one slight problem I have though: last week, Emirates announced a US$197 million sponsorship of FIFA, which will cover the next two world cup competitions. On top of this, last year Emirates completed a US$180 million deal with Arsenal Football Club. When you include its deal with other football clubs including Paris St Germainl, and deals in golf, Formula One, tennis, cricket and yachting, Emirates is becoming a truly global sponsor. Great stuff. And at great cost. No exact figures on all the deals are available, but I think it’s safe to say we are talking in the region of US$500 million. Which raises the question: was it really necessary to pass on those US$60 per ticket fuel surcharges onto Emirates customers?||**||Saudi celebration|~||~||~|This week we celebrate the Saudi Achievement Awards. And as you will see from our special supplement, there is much to celebrate: not just for the award winners, but for the whole of Saudi Arabia. Last December the country finally joined the WTO, and in doing so the KSA liberalised much of the economy. Apart from removing many of the obstacles potential investors faced in the past, it implemented a number of new incentives, including tax breaks. No wonder the difference in figures: in 2004, the Saudis attracted just US$1.8 billion in foreign investment. Last year, that figure rose to US$53 billion. This year, it may be close to double that. The Saudi Arabian General Investment Authority is now confident that by 2010, Saudi Arabia will have a top ten investment location ranking. Much has been written in recent weeks about the fall in the stock market, but as the experts explain in our supplement, that is only a temporary situation. More importantly, over the coming years, Saudi Arabia is likely to become one of the top places in the world to do business.||**||

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