Israel's decision to freeze money transfers to the Palestinian
Authority (PA) spurred an Iranian call for Arab and Muslim countries
to step into the financial vacuum and prop up the newly elected
As Iran's Supreme Leader Ayatollah Ali Khamenei encouraged Hamas
to stick to its refusal to recognize Israel, Hamas prime ministerial
nominee Ismail Haniyeh set about forming the first Palestinian
government led by Islamic militants.
Mr. Haniyeh, who is reportedly trying to form a coalition within
the next five weeks even though Hamas controls 74 of the 132-seat
parliament, said that Palestinians had "lots of alternatives" to
financial aid from Israel, Reuters reported Monday. That was
highlighted by the visit to Iran of exiled Hamas political leader
Also Monday, the Muslim Brotherhood, which has associated groups
in 86 countries, said it was launching a donation campaign for the
new PA. And some Arab foreign ministers were to meet in Algiers to
discuss sending the PA $50 million monthly.
But while Israel has stepped up efforts to isolate Hamas
politically and economically, it's being careful to avoid triggering
a humanitarian crisis. That, experts say, could erode international
sympathy for Israel's boycott of the new government and bolster
hostile outside influence from the Muslim Brotherhood or Iran.
"There's a careful balance between isolating Hamas and worsening
the situation of the Palestinians," says Gerald Steinberg, a
political science professor at Bar Ilan University, near Tel Aviv.
"If the Palestinian economic situation gets even worse, that will
create more pressure on Israel, and create friction between Israel
and foreign governments.''
The stoppage of $50 million in monthly customs payments to the
Palestinians has the potential to bankrupt the self-rule authority
within months. It could also further impoverish an economy blighted
by five years of fighting, say observers. And yet, Acting Israeli
Prime Minister Ehud Olmert stopped short of sanctions that would
have moved closer to an economic disengagement from the
That policy acknowledges sentiment for new progress toward a
unilateral separation from the Palestinians, while recognizing that
economic ties can't be severed overnight. Israel has already said
that it won't turn off the electricity and water supply to the
Palestinians, even as Mr. Olmert warned that the new Palestinian
government is "becoming a terrorist authority."
"This is a lot of very harsh sounding words that have very little
bite," says Gershon Baskin, cochairman of the Israel Palestinian
Center for Research and Information. …