FPC Report

European Aid to Palestinians: Evidence of Foul Play

31 August 2004

The Funding for Peace Coalition (FPC) has released a new report detailing the diversion of unprecedented sums of financial aid from the Palestinian people towards corruption and violence.

The FPC report is called Managing European Taxpayers' Money: Supporting The Palestinian Arabs - A Study In Transparency. (Please be patient, as this large file may take a few minutes to download. If you have trouble, please contact the Funding for Peace Coalition at

It publishes evidence, which substantiates a compelling connection between European funding and ongoing Palestinian corruption and terrorism. It also highlights the utter failure of European organisations to monitor where these funds have been directed. The details of theft, nepotism, and embezzlement on the part of the PA are supported by incompetence and apathy on the part of European agencies.

The FPC has continuously stressed that the PA has soaked up huge sums of donor aid. Since 1993, the European Union alone has contributed over 2 billion directly and indirectly to the Palestinian Authority (PA). Member states have donated a further 2 billion in the same period.

FPC's work raises the following major issues, each of which strikes at the very sprit and letter of the European Union's Constitution:

  • European aid has not reached its intended target - the Palestinian people. It has been diverted towards graft, terrorism and incitement to hatred.

  • Despite repeated denials from senior European politicians and civil servants, terrorists are on the Palestinian Authority payroll. This includes, in particular, members of the Al-Aksa Martyrs Brigades who have openly admitted their direct roles in acts of murder. The salaries of these murderers come directly from budgets provided by European government aid, even though the Al-Aksa Brigades have been officially classified as terrorists by Europe.

  • European taxpayers' funds have not been managed transparently in everything connected with aid to the PA and to the Palestinian people. The facts have been concealed and continue to be concealed from European taxpayers.

  • The methods used to fund the PA might even be considered to be money laundering.

  • FPC's study does not deal with the question of whether aid should be given to the Palestinians, or what level of aid is appropriate. It assumes that providing aid to the Palestinian people is important and helpful to the cause of peace. The FPC report focuses on whether aid transfers from European sources are accomplishing the stated goals of the donor community, and on the transparency of its management.

    The lack of monitoring controls highlighted in the report should come as no surprise. FPC has continually commented on these issues over the past 12 months. And there is growing pressure within Palestinian ranks calling for an end to decades of corrupt leadership.

    Mohammed Dahlan, a former PA Interior Minister, was quoted in "The Guardian" in early August 2004. He observed that all of the funds which foreign countries donated to the Palestinian Authority, a total of $5bn, "have gone down the drain and we don't know to where."

    According to FPC's spokesperson, David Winter: "Every piece of information in our report has been thoroughly checked. The extensive footnoting of the report allows the reader to check any and every fact presented."

    Why is there a need for this report? Winter says: "We believe that, if we can draw sufficient attention to the issues, the political drive will be created to ensure that the Palestinian Arabs receive the intended benefit from the billions in aid channeled through their leadership and institutions. With proper management, we believe that mutual tolerance can be encouraged and ultimately regional peace can be achieved. Aid money will then be available to resolve other, often more pressing, humanitarian issues - possibly such as the crisis in Sudan and others."

    Asked whether the European Commission had misled the European Parliament, Winter responded, "This is a key question which the FPC report addresses. For example, there have been countless reassurances that the PA payroll is tightly controlled. It is international donors who help pay for these employees. In fact the payroll has been found to be bloated with fictitious names or comprised of groups adjudged as terrorists by the EU itself."

    Estimates have put total donor aid to the Palestinians since 1993 at over $10 billion in direct and indirect aid. Have the European contributions, which are paid for by taxpayers, been transferred to the right people? Have they been managed in acceptable ways? Has the Palestinian public benefited? The availability of this new report means that the interested public can read the facts and decide for themselves.

    Click here to read the full report. This report requires Adobe Acrobat Reader (free).

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