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KHALED ABU TOAMEH:
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Closing the books on Arafat

PA Finance Minister Salaam Fayaad took his anti-corruption crusade a notch further by talking to Western media.

Last week, as Yasser Arafat and his prime minister, Ahmed Qurei, were still squabbling over the composition of a new Palestinian Authority cabinet, Finance Minister Salaam Fayad made his own contribution to the disarray by announcing that he would stay at home until the two resolve their differences.

Expressing regret over the bottleneck, Fayad told friends who telephoned to see what was wrong that he was fed up with the ongoing power struggle between Arafat and Qurei.

“I consider the term of the emergency government in which I was to have expired on November 4, and in my view, the law is clear and the provisional government should not be extended except through legal measures — which were not taken,” he told them.

Asked if he was planning to boycott the cabinet or submit his resignation, Fayad explained: “It’s not a matter of boycotting; quite simply, I consider the government’s term of office as having expired.”

Some Palestinian officials described Fayad’s move as a tactical measure designed to put pressure on Arafat and Qurei to come up with a solution that would clear the way for the formation of a new broad-based cabinet.

“I wouldn’t be surprised if his move was coordinated with the Americans,” says one senior official. “After all, Fayad is Washington’s favorite.”

Shortly after he made his dramatic announcement, Fayad traveled to Gaza City to participate in a seminar on the current political crisis and reforms in the Palestinian Authority. He refused to talk about his decision to boycott the cabinet, but stressed that he had notched up several achievements in his efforts to implement major reforms in the PA.

“We are still facing some difficulties,” he said. “But we are working hard and there is still some disorder in the institutional infrastructure.”

Just as Fayad was talking in Gaza about the need to speed up the process of reforms, CBS’s 60 Minutes program was about to broadcast an investigative report revealing that Arafat squirreled away nearly $1 billion in public funds to ensure his political survival.

According to 60 Minutes reporter Lesley Stahl, who traveled to the Middle East to work on the program, a team of accountants hired by the Palestinian Finance Ministry has determined that part of Arafat’s wealth was in a secret portfolio worth close to $1 billion — with investments in companies such as a Coca-Cola bottling plant in Ramallah, a Tunisian cellphone company and venture capital funds in the US and the Cayman Islands.

Stahl also discovered that Arafat was transferring $100,000 a month out of the Palestinian budget to his 40-year-old wife, Suha, who has been living a lavish life in Paris for the past three years.

Fayad, who was interviewed for the program, admitted that, “There is corruption out there. There is abuse. There is impropriety, and that’s what has to be fixed.”

Asked if his anti-corruption campaign was jeopardizing his life, Fayad said he does not feel threatened.

“It’s a dangerous neighborhood,” he added, “but you know this is about… doing the right thing for the people.”

IN YET another damning TV documentary, BBC’s Correspondent program revealed that Arafat was paying a monthly $50,000 to hundreds of gunmen belonging to Fatah’s armed wing, the al-Aksa Martyrs Brigades, a group responsible for a string of suicide attacks against Israel.

The revelation did not come from Fayad, but rather from Abdel Fattah Hamayel, who served as a minister in the former cabinet of Mahmoud Abbas.

Hamayel was interviewed in his capacity as liaison between the PA and the unruly Fatah gunmen in the West Bank and was therefore the most relevant and knowledgeable person to speak about the subject.

Needless to say, the Palestinian media, which is entirely subject to Arafat’s patronage, completely ignored the findings of the TV programs (see ’What graft?’). Even the sensationalist Al-Jazeera, Al-Arabiya and Abu Dhabi TV stations had nothing to tell their millions of Arab viewers about the fate of hundreds of millions of dollars originally allocated to the welfare and prosperity of the Palestinian people.

But in Arafat’s inner circle in Ramallah, over the weekend, eyebrows were raised when CBS’s advance publicity for the 60 Minutes program made it clear that Fayad had made his own contribution to exposing some of the findings.

“He made a mistake by talking to journalists who had come with the specific aim of smearing President Arafat and the Palestinians,” complained one of Arafat’s confidants. “The president was distressed when he heard about Fayad’s role in spreading these lies.”

Corruption is one of the taboos in Arafat’s regime, and only a handful of officials are prepared to even discuss the issue.

Husam Khader, a legislator from the Balata refugee camp near Nablus, was at the forefront of the anti-corruption battle before he was detained last year by the IDF and charged with aiding suicide bombers. Abdel Jawad Saleh and Hassan Khariasheh, two other legislators, have also earned a reputation of being outspoken critics of theft of public funds.

BUT WHILE these legislators are busy complaining about corruption to the foreign and Israeli media, Fayad appears to be the only one to actually do something about it. Ever since he took over as finance minister, the reform-minded Fayad has been waging an uncompromising war against the widespread misuse and embezzlement of public funds — though so far with limited success.

Some Palestinians refer to him, jokingly, as “Bush’s man” in the PA because of the praise the US president has been heaping on him. To Arafat, who is ostracized by the US, he is an indispensable channel of communications to the US administration.

“He’s Arafat’s insurance policy,” says a Palestinian legislator from Ramallah. “Arafat knows that he can’t throw out such an internationally respected figure like Fayad without having to pay a high price.”

Arafat, on the other hand, has no reason to be afraid of Fayad, who presents himself as a boring technocrat devoid of political ambition and consumed with dry numbers and financial calculations.

A former International Monetary Fund representative to the PA, the 51-year-old Fayad has never constituted a threat to Arafat’s rule. His close friends say he’s not interested in jobs or power and that all he cares about is providing the Palestinians with the best form of government.

“He doesn’t want a senior job, nor is he trying to establish bases of power,” says one of the Finance Ministry officials working with him for the past 15 months.

Fayad, an economics professor who was born in the West Bank and educated in Beirut and the University of Austin, Texas, is a passionate believer in political democracy and financial transparency. Since his appointment as finance minister last June, he has singlehandedly reformed the PA’s financial procedures, and ended the bizarre system of cash payments through which Arafat wielded much of his patronage. Late last year, he published a government budget for the first time in years.

It was Fayad who, two years ago, pressured Israel into releasing millions of dollars of customs revenues frozen since the outbreak of the intifada uprising, and it was largely thanks to his work that donor countries pledged to give the Palestinians a further $700m in budgetary assistance.

In a recent interview in his office in Ramallah, Fayad described the amending and approval of his draft budget by the Palestinian Legislative Council earlier this year as “institution-building at its very best.”

“This is the way that we would like to see our systems evolve,” said Fayad. “This is precisely the kind of government system that we are trying to make sure we have in place. It is very much consistent with a vision of having a very inclusive, open, democratic system, fully transparent with maximum accountability.”

IN ANOTHER bold move, Fayad published the accounts of the hitherto rather murky investments and commercial ventures and monopolies of the PA. His campaign against Arafat’s multiple monopolies has earned him the title of the Palestinian Robin Hood. But he still has a long way to go before he manages to lay his hands on the missing millions.

Fayad did not mince words in describing the “chaos” he encountered when he took office.

“The systems were not mature or sufficiently developed in the management of public funds,” he said. “Basic units that constitute a well-functioning public finance system were not there. And in a system — non-system — like this, chaos if you will, there is an ’anything goes’ type of environment.

“When you have that environment, it would be naive to assert there was no corruption. Of course there was. You have a system that’s totally loose. No controls. No audit. Extra-budgetary spending taking place all over the place. It’s wrong and it needs to be fixed. This is not about cosmetic change. This is not about an attempt to paper over problems. This is about profound change — change for the better.

“This is about a state that provides us with the opportunity to live as free people. To be left alone, fully respectful of rights and obligations and sensitivities of all of our neighbors, including, of course, Israel. But we need to have a sense of possibility that can happen. This is about that, it’s not about continued dominion,” he said.

“Unless there is the realization that this is what it will take, I don’t think we’re really getting anywhere. “Is there a genuine desire to end this conflict? Is there a genuine desire to recognize the full and unfettered right of Palestinians to live like human beings?” he asked. “I need to know, as a Palestinian, that this is what it’s about. I don’t want to be governed by Israel and I am not looking for a handout.”

Now that he has been renamed finance minister in the new cabinet headed by Qurei but dominated by Arafat, Fayad later this month faces the tough task of persuading a donors conference in Italy why European taxpayers should continue to give millions to the Palestinians at a time when huge sums are finding their way to secret bank accounts in Paris and Switzerland.

To his dismay, he will also have to watch Arafat and Qurei as they continue to fight over authorities and appointments in the Palestinian Authority.

What graft? Most Palestinians did not hear about the CBS program that disclosed that Yasser Arafat transferred $100,000 a month to his wife, Suha, who lives in Paris.

Nor did they hear about the $1 billion which he reportedly diverted from the PA budget to secret bank accounts. The reason: censorship.

“You can publish almost anything in our media, except for sensitive stories related to corruption and embezzlement of public funds,” says one Ramallah journalist. Arab satellite stations, particularly Al-Jazeera, also refrain from dealing with sensitive issues. All these stations have correspondents based in Ramallah and Gaza and they don’t want to risk their lives.

In the latest example of intimidation, masked gunmen belonging to the al-Aksa Martyrs Brigades, went on the rampage in the offices of the Saudi-owned Al-Arabiya TV in Ramallah and threatened to shoot staffers. The reason: the station had been reporting on the power struggle between Arafat and former prime minister Mahmoud Abbas in a way that infuriated Arafat.

As one Palestinian editor summed it: “Thank God we have CBS and BBC to tell us about what is happening in our areas.”