A part of Yasser Arafat's secret hoard - $4 bn - has been documented and accounted for in a painstaking project undertaken by Nigel Roberts, the World Bank's country director for the West Bank, and Palestinian finance minister Salam Fayyad. They have obtained partial information about another $1-2bn and found a further three to four billion invested on Arafat's behalf by two individuals, his chief financial adviser Mohammed Rashid, and Palestinian-born international tycoon Samer Khoury. "You can stop going around with your hat in your hand," a stern US secretary of state Condoleezza Rice told Palestinian leader Mahmoud Abbas (Abu Mazen) at the London conference on Palestinian reforms earlier this month. "You have all the money you need to transform the economic situation in the Palestinian Authority." She told Abbas to go back to Ramallah and assume immediate control of the Palestinian Investment Fund (PIF) where the bulk of Arafat's money was stashed, or forget about receiving a single aid dollar from international donors. Pressed for details on their findings, Roberts and Fayyad explained: Arafat kept an iron grip on all the moneys flowing to the Palestinian Authority after it was established by the 1993 Oslo Accords. World donors contribute at least $8 bn towards the creation of jobs and building infrastructure - schools, medical facilities, water works and roads. According to the Los Angeles Times, the PA was awarded "one of the most expensive development programs ever granted on a per-capita basis." But Arafat had other goals in mind. He diverted the lion's share to profitable investment on the advice of Rashid, who conferred with Khoury at his offices in Greece on the highest-yielding outlets. Khoury often secretly handled the investment through his own company.
In 2002, world aid givers began demanding guarantees that that their contributions were not being spent to fuel the Palestinian terrorist war against Israel then raging in its third year. The Palestinian Investment Fund was set up to provide "responsible stewardship" for Palestinian Authority assets and holdings and ensure they were used to stimulate economic growth — not buy guns. Before long, Khoury got himself appointed to the PIF's audit and nominations committees and Rashid joined the board of directors. This gave them the run of the Fund and kept all investments under Arafat's thumb. Arafat's secret business empire sprawled far and wide, ranging from telecommunications companies in Brazil to Guinea Bissau's national airline and a coffee plantation in Zimbabwe. Eighty percent of international donations accumulated over nearly a decade was invested for profit. The remainder financed terrorism, arms purchases, training, subsistence and payouts to families left bereaved by suicide bombings and other casualties. A portion of the profits supported Arafat's corrupt entourage of cronies, hangers-on and their life style. Not much was left over for creating jobs or building hospitals.
Abu Mazen was sent off from London to start selling off these assets to finance urgent projects for his impoverished people. He was warned that the $350 million pledged the Palestinians would be transferred only when it was matched by income from the sale of PIF properties — a dollar-for-dollar deal. The World Bank has projects ready to go. Roberts cited a $1bn plan to create 50,000 jobs in the Gaza Strip. Back in Ramallah, Abu Mazen ran into his first major obstruction to divestment: Prime minister Ahmed Quriea (Abu Ala), who by withholding his signature has the power to block any Palestinian Authority measure, accused Abbas of surrendering to US-British dictates and opening the door for them to take over Palestinian funds. Then, most of the 11 PIF board members resigned or are about to do so, further disabling the fund's operations. As a result —
1. Projects in which funds have already been invested are left high and dry for lack of anyone to take charge of direction. Most PIF staffers are offspring, relatives or mistresses of senior Palestinian officials who have ordered them to down tools until their own political and financial future is settled.Abu Mazen's close allies warn him, according to DEBKA-Net-Weekly's Palestinian sources, that without control of the PIF, he will never be more than a figurehead, His rivals have come to the same conclusion and are all now chasing after the billion-dollar fund hoping to lay hands on the wherewithal for buying a following. They are racing all the harder with the approach of the next Palestinian ballots — the April 28 municipal election and the July 17 parliamentary vote. A hefty cash campaign chest can promise victory. It can also buy the undying loyalty of all or some of the endemically corrupt Palestinian security and intelligence services. Conversely, candidates strapped for funds may as well give up. Control of the PIF will also buy political control within Abu Mazen's unruly and divided Fatah party. At the same time, some central party figures warn that the gold rush could destroy the Fatah from within.
2. The departure of Arafat, Khoury and Rashid leaves no legal authority to administer the Fund, sign documents on its behalf or appoint new board members. Fayyad is seeking legal advice.
3. Palestinian security and intelligence chiefs are scrambling for PIF appointments and jobs.