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Gaza salary crisis - Palestinian unity gov't's first challenge

10 June 2014 04:44 (UTC +04:00)

Baku-APA. The salary crisis gripping the Gaza Strip is becoming the first serious challenge to the interim Palestinian unity government, officials and observers said on Monday, APA reports quoting Xinhua.

"The crisis is a severe challenge to the new government. If it is not resolved soon, the entire economy in Gaza will collapse due to the ongoing closure of banks," Ali Hayek, head of the Gaza Businessmen Association, told Xinhua.

Major banks in the coastal enclave have been closed since Wednesday after employees belonging to the Hamas movement protested their exclusion from a payment deal and prevented Fatah employees, who are paid by the Palestinian National Authority (PNA) , from cashing their monthly payments.

The new government, sworn in before Palestinian President Mahmoud Abbas in Ramallah last week and headed by Prime Minister Rami Hamdallah, is a transitional technocratic government created under a deal backed by former Palestinian rivals, the Islamist Hamas movement and Abbas' Fatah party.

Gaza has been hit hard by an economic downturn, as its Hamas leaders entered into the unity government with hopes of boosting the economy and receiving development aid. But the new unity government's recent decision to exclude Hamas employees from receiving payments has raised the ire of many Hamas members in the strip.

Last week, the PNA transferred the salaries of 70,000 Fatah employees to the banks in Gaza and excluded payments to the 50,000 Hamas employees who were previously paid by the Islamist group before the unity government was formed.

Earlier on Monday, Khaleel al-Hayyah, a senior Hamas leader from Gaza, slammed Hamdallah's government, holding it responsible for the current unresolved crisis.

"The unity government made a mistake in dealing with the employees and neglected the other details of the reconciliation agreements," al-Hayyah told a news briefing held in Gaza.

On Monday morning, dozens of Hamas employees demonstrated in front of a major bank in Gaza city, calling on Hamdallah's government to pay the salaries of all employees.

Mohamed Seyam, head of the Hamas-run Employees Union who joined the demonstration, told reporters that the new government has to provide the banks with the lists of Gaza employees and pay them.

"In case the situation remains as it is, the coming days will witness more escalation until the crisis is resolved," Seyam said, adding "the salary crisis shouldn't be an obstacle for achieving real internal (Palestinian) reconciliation."

Before Hamas' violent takeover of the Gaza Strip in June 2007, the PNA paid the salaries of its civil servants, police and security employees in both the West Bank and Gaza.

After Hamas seized control of the enclave in 2007, the Islamist movement took power and paid the salaries of its employees, while Abbas continued to pay his 70,000 civil and security employees in the Gaza Strip their monthly salaries on condition that they refrain from working for Hamas.

The PNA Monetary Corporation said on Sunday that all the banks in the Gaza Strip were forcibly closed by Hamas security forces.

"The government is doing its best to end the internal division and all its outcomes, and this would need the cooperation of everyone in the Palestinian society and in the private sector," Unity Government Spokesman Ihab Bseiso said.

The Palestinian budget in general is suffering from a financial crisis, which prevents the unity government from reimbursing the Hamas employees, Ahmed Majdalani, a member of the Palestinian Liberation Organization's executive committee, told Xinhua.

Meanwhile, Fatah leaders in the West Bank accused Hamas officials of inciting the employee protests in an attempt to sabotage the reconciliation efforts.

The salary crisis in the Gaza Strip is the latest burden for Hamas employees who have suffered from recent pay cuts since last year, when the financial crisis in the enclave began.