Palestine - Corruption

By the turn of the century, concerns had mounted about deep and wide-spread corruption within the Palestinian political establishment, including potential fraudulent use of US financial assistance.

Media highlightrf the plight of the Palestinians in Gaza, but instead of highlighting the ways that the Hamas terrorist leadership mismanages the local economy or gives Israel justifiable cause for concern, we are told that an Israeli blockade is to blame. Similarly, instead of calling attention to the omnipresent and insidious corruption within the PLO and Fatah leadership in the West Bank, it is said that Israeli settlements, many of which will surely not be a part of any future Palestinian state are the true problem, despite the fact that many of these locales employ Palestinian laborers.

The corruption within the Palestinian political establishment had been endemic for decades. Reports suggest that Palestinian President Mahmoud Abbas, like his predecessor, Yasser Arafat, used his position of power to line his own pockets as well as those of his cohort of cronies, including his sons, Yasser and Tareq.

The Palestinian Investment Fund, for example, was intended to serve the interests of the Palestinian population and was supposed to be transparent, accountable, and independent of the Palestinian political leadership. Instead, it is surrounded by allegations of favoritism and fraud. President Abbas is reported to have asserted complete control over the fund, filled its board with his own allies, and has rejected all attempts to audit its operations.

Even more disturbingly, Yasser and Tareq Abbas, who amassed a great deal of wealth and economic power, enriched themselves with US taxpayer money. They have allegedly received hundreds of thousands of dollars in USAID contracts. This is not to say that they did not have a legitimate right to compete for these contracts, but it does raise questions as to whether they received preferential treatment of any kind as well as if and to what extent they were involved in corrupt practices within their own government.

In addition to strengthening maligned actors, this corruption short circuited any progress that credible leaders, like Prime Minister Fayyad, have been able to achieve. A lack of accountability and transparency undermines the trust of the Palestinian people in their political institutions and renders them ineffective. How can democratic institutions be established or the economic wellbeing of the Palestinian people be advanced if their own leadership is raiding the common coffers? And if one of these leaders, against all empirical evidence, were to be willing to make peace with Israel, which will surely require unpopular even if necessary concessions, how can we expect the Palestinian people to respect an agreement negotiated by a hollow leader devoid of legitimacy among his own people?

For ordinary Palestinians, the situation was rather more serious, in that he or she realistically had only two viable political options: Radical, violent Islamic Hamas or feckless, corrupt Fatah. It is not much of a choice and, thus, no surprise that so many Palestinians have given up on their own political system altogether.

The Anti-Graft Law (AGL) of 2005 criminalized corruption, and the State Audit and Administrative Control Law and Civil Service Law both aim to prevent favoritism, conflict of interest, or exploitation of position for personal gain. The AGL was amended in 2010 to establish a specialized anti-graft court and the Palestinian Anti-Corruption Commission tasked with collecting, investigating, and prosecuting allegations of public corruption. The Anti-Corruption Commission, appointed in 2010, has indicted several high profile PA officials; these cases were pending before the courts. However, the PLC, which is the legislative body responsible for oversight of the PA’s executive branch, had not met since April 2007.

In May 2011, the World Bank reported that the PA had made significant progress in establishing a strong governance environment in many critical areas, but highlighted continuing areas of concern, including management of state land assets, transparency in licensing and business rights, and public access to government information. Palestinian civil society and media are active advocates of anti-corruption measures, and there are also international and Palestinian non-governmental organizations that work to raise public awareness and promote anti-corruption initiatives. The most active of these is as the AMAN Coalition for Integrity and Accountability, the Palestinian chapter of Transparency International. In May 2011, the World Bank reported that relatively few Palestinians have actually experienced bribery (less than 2 percent of those surveyed), and Palestinians do not consider corruption to be one of the most serious problems they face.

When compared to other countries in the region, Palestinians’ experience of bribery in the public sector is very low. There are no reliable means of determining where or to what extent this kind of activity occurs.

Businesses and investors observed that perceived widespread corruption involving political figures and institutions has largely disappeared during the decade 2005-2015. Private sector businesses agree that the PA had been successful in reducing institutional corruption and local perceptions of line ministries and PA agencies are generally favorable in this regard. PA officials, businesses and representatives of service sectors note, however, that the largely discretionary authority given to Israeli military, police, and civilian officials in administering economic policy in the West Bank – touching on imports, checkpoint crossings, labor permits, and building licenses, among other things – create regular opportunities for low-level corruption on a range of daily decisions.