Analysts say donor funds in limbo due to failure of Gaza unity government and lack of follow-up by Egypt.
By Annie Slemrod
JERUSALEM - Just over five percent of the money pledged to rebuild Gaza after last summer’s devastating 50-day war with Israel has been delivered, IRIN has learned.
More than 2,000 Palestinians - the majority civilians - were killed during the conflict and around 100,000 homes were destroyed. Six months since a ceasefire was agreed, many families are still sleeping in temporary shelters.
Five months ago world leaders promised over $5 billion for reconstruction, redevelopment and government assistance. Yet only a fraction has actually materialised.
“Approximately $300 million” has been received so far, a source at the office of the Palestinian Deputy Prime Minister Mohammad Mustafa - who is heading up the government's reconstruction efforts in Gaza - told IRIN.
“Projects [that are] being held up because of the lack of donations are major reconstruction projects, chief among them housing and road reconstruction,” the source said, speaking on condition of anonymity.
The revelation follows comments by Robert Turner, the Gaza head of the UN agency for Palestine refugees (UNRWA) - that “virtually none” of the pledged funds had reached the territory.
The $5.4 billion that was promised at the Cairo conference exceeded the $4 billion the Palestinian Authority (PA) said it needed. About $2.8 billion of the pledged money was earmarked for the first three years of reconstruction. Yet only a fraction of that has been made available.
Tracking down who promised what has proved stubbornly difficult.
The website of the conference, which was hosted by Egypt and Norway, contains no specific breakdown of funding pledges.
IRIN asked the Norwegians to provide a full list of promises made, but Frode Overland Anderson, a spokesperson for Norway’s Minister of Foreign Affairs, told IRIN: “It is not feasible to make a complete and detailed breakdown of pledges from the Cairo conference.” The reasons, Anderson said, were “partly because donors have [yet] to provide a comprehensive breakdown of their contributions and partly due to conditions on the ground that are preventing [disbursement of] further instalments.”
However, some say there has been too little emphasis placed on chasing up the money. Contrasting it with pledging conferences for Syria, one UN staffer said the Egyptians had not been sufficiently proactive.
"When Kuwait organised the conference on Syria, the secretariat followed strict procedures to ensure that the money got paid, including inviting donors to meetings. Egypt has done nothing.”
Egyptian officials did not respond to requests for comment.
In fact it was only in mid-January, ahead of a donors' meeting in March, that Norway formally requested the World Bank to track down how much money had been delivered.
According to Steen Lau Jorgensen, the World Bank’s country director for Gaza and the West Bank, the process will "include a report … that will reflect the pledges of Gaza reconstruction disbursed through all channels and the timing for disbursement. It will also assess to what extent the donors have realised their pledges and will break down the list of pledges into budget support and Gaza reconstruction."
One European diplomat told IRIN that although the lack of actual disbursement so far is especially low in this case, conferences are notorious for producing big headline figures that don’t ultimately materialise. "These kinds of pledging events tend to produce much more in pledges than what is actually delivered," he said. "I doubt that we have ever seen a pledging conference where commitments were ever followed up completely."
But even before Cairo, donors expressed frustration that they were expected to pay to rebuild a territory that would likely descend into repeated violence without a durable solution to the Israeli-Palestinian conflict.
Hamas and Fatah, the two leading Palestinian factions, reached a political agreement ending seven years of bitter division just before the latest outbreak of hostilities with Israel. But the new joint government of technocrats has yet to take over in the Gaza Strip leaving Hamas - considered a terrorist organisation by the United States - still in charge. That is a matter of concern for some donors.
A senior EU diplomat who is familiar with the situation told IRIN: “Donors are holding back until the PA gets a foothold in Gaza.”
“We need to see some signs of political certainty and there is none,” he said on the condition of anonymity.
The source in the Palestinian deputy prime minister’s office agreed that some “donors seem to be hesitant in fulfilling their pledges as the reconciliation agreements seem to be at an impasse”. But he added: “The [Palestinian] government believes reconstruction efforts should proceed regardless of the progress in implementing the agreement.”
Everyone IRIN spoke to agreed that the UN-brokered Reconstruction Monitoring Mechanism, designed to allow construction materials into Gaza while assuaging Israeli concerns about security, is now operating. But the broader Israeli blockade of Gaza remains in place and Norway said there is still “the challenge of providing sufficient volumes of building materials into Gaza."
The EU diplomat said concerns about Israeli control over the borders added to worries about Gaza’s political situation. “The fact of the matter is that a lot of the money pledged in Cairo was premised on the Israelis easing the blockage … so that people would be able to travel more freely keeping in mind security concerns, and that the PA would be able to play more of a role of authority in Gaza. These two admittedly complicated issues have not materialised in a way that gives anyone a feeling this is worth the money at the moment.”
The Gulf Arab states in particular pledged high at Cairo: Qatar promised some $1 billion, the United Arab Emirates (UAE) $200 million and Saudi Arabia $500 million ahead of the conference.
Yet so far they have made only limited payments due to the lack of political change. Said the European official: “There is some disappointment that Arab countries may have made commitments that are not delivering. … It is particularly difficult to get them to commit to actually provide cash which is what is now needed,” as opposed to in-kind donations - providing the required goods and services themselves. The cash shortage is particularly acute for projects carried out by UNRWA, which recently had to suspend its financial assistance for rent and home repairs because of a lack of funding.
UNRWA spokesperson Chris Gunness said: “Donors have been generous but unfortunately this does not cover all the needs; hence we were forced to suspend the cash progamme for rent and rebuilding which are among the most urgent needs.”
The EU diplomat said these countries, with their political ties to Gaza, are as keen as the Europeans to see change from the Israelis and the PA. “The ones who have come up with big figures - the Qataris, the Saudis and the Turks - they need to see some progress, truth be told.”
The limited funds that have been made available have allowed some reconstruction work to begin: some schools and health facilities have been patched up and there have been emergency repairs on electricity, water and sanitation networks. The huge piles of rubble, left behind after the Israeli bombardment, are now starting to be cleared.
But Hamas spokesperson Sami Abu Zuhri told IRIN he doesn’t see much progress. “Gaza residents don’t notice any real effort to start reconstruction operations, except very little amounts that are used to rehabilitate, restore and repair some houses here and there.”
Larger projects, including rebuilding roads and economic infrastructure, are nearly ready to begin but will remain on hold until the money arrives. Anderson, spokesperson for Norway’s Ministry of Foreign Affairs, told IRIN. “While the UN system has made its best effort to address the short-term needs, further implementation requires swift financial contributions by the donors.”
The Palestinian source said donors should “be reminded that the people of Gaza are in dire need, and that failing to move forward with reconstruction could have negative impacts on security and stability in the region."