EU blames Israel for the "grave" fiscal crisis in the Palestinian Authority, calling on it to unfreeze some $ 600 million it owes the PA.
"The principle reason (for the crisis) is the suspension of transfers to the Palestinian Authority of tax revenues and custom duties pursued by Israel on behalf of the Authority, " European humanitarian aid Commissioner Louis Michel told a conference in Al-Quds on humanitarian aspects of the Middle East Conflict on Friday.
"We hope, we expect the Israeli government to cease this possibility," DPA quoted him as saying.
He also stated that Israeli restrictions on movement "annihilated any chance for economic development in the Palestinian territories," pointing out that nearly 60 per cent of Palestinians lived under the poverty line of 2 euros a day.
The Zionist regime and the Palestinian Authority earlier achieved an agreement on facilitating the movement of people and goods within the Palestinian Territories and on opening an international crossing on the Gaza-Egypt border that will put the Palestinians in control of the entry and exit of people.
The negotiations were facilitated by Secretary of State Condoleezza Rice, European Union High Representative for the Common Foreign and Security Policy Javier Solana and the international community's envoy for the Israeli disengagement from Gaza, James Wolfensohn.
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