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Middle East: EU Bracing Itself Against Allegations Of Misuse Of Palestinian Funds

Israel's accusation that at least some European Union aid to the Palestinian Authority has been used to pay terrorists threatens to damage the bloc's credibility as a mediator in the Middle East crisis. The European Commission rejects the allegations, while also promising to "seriously" look into them. In Brussels, one analyst interprets the attack as an attempt by Israel to remove a troublesome supporter of the Palestinians from the picture.

Brussels, 7 May 2002 (RFE/RL) -- The European Commission yesterday promised it would "very seriously" look into allegations that some of its financial aid to the Palestinian Authority may have been used to pay terrorists.

The allegations, which first surfaced last week, were repeated over the weekend by members of the Israeli government and are reported to be on the agenda of today's meeting between Israeli Prime Minister Ariel Sharon and U.S. President George W. Bush in Washington.

The European Commission's External Affairs spokesman, Gunnar Wiegand, said yesterday that Israel has not shared evidence of its allegations with the EU. "The allegations made by the government of Israel are serious, and we take them very seriously. The European Commission will examine all evidence available as soon as the government of Israel provides documentary evidence and shares it with us. This has not yet been the case."

A background document released yesterday by the European Commission said it had provided the Palestinian Authority with 10 million euros a month since last June. The document said this is done to help the Palestinian administration deal with "short-term liquidity problems" caused by the interruption of monthly transfers of tax receipts by Israel after the outbreak of the second intifada in October 2000. A sizable portion of the money goes toward helping the Palestinian Authority pay public service salaries. Wiegand yesterday said this includes pay for the police force.

Wiegand said foreign aid provided by the EU is subject to what he called the "most stringent" monitoring among international organizations. He said all payments to the Palestinian Authority are vetted on a monthly basis by the International Monetary Fund.

The Israeli allegations come amid signs that Sharon's government may be keen to sideline the EU in reaching a peace settlement.

Michael Emerson, a senior analyst with the Brussels-based Centre for European Studies, says Israel's aim may be to leave the United States in the main Mideast mediating role.

"The Israelis may feel it's more attractive to them to keep out the Europeans because they can 'handle' the Americans, quote unquote. But if that is the idea, one can immediately observe that the Arab position will be the absolute reverse; the Palestinian and Arab position will be the absolute reverse."

Emerson flatly dismisses the possibility that the EU could be held culpable for allegedly letting some of its aid money fall into terrorist hands. "I would say it's complete and utter rubbish, and it's propaganda in the dirty diplomacy department. I cannot conceive of the European Union knowingly doing something like that. It's absolutely absurd and irresponsible international diplomacy to be making such a proposition."

Emerson says the European Union is a difficult partner for Israel because the EU supports the recent Saudi peace initiative, which suggests an independent Palestinian state must be given possession of the territories Israel occupied after the Six-Day War in 1967, in return for full recognition by all Arab states.

Returning to pre-1967 borders would mean Israel would have to relinquish control over the Gaza Strip, the Golan Heights and the West Bank. Most analysts agree Sharon's government is unlikely to acquiesce to these demands.

But, says Emerson, there is "no chance of peace" in the Middle East without a sustainable settlement of territorial disputes between Israel, the Palestinian state and their Arab neighbors.