Palestine: Fayyad’s Resignation, A Hard Blow for US

Appreciated by Westerners, the Palestinian prime minister had managed to restore order to the finances of the Palestinian Authority, but the old guard of Fatah had never really accepted him.

Jerusalem Correspondent

Mahmoud Abbas finally accepted the resignation of his prime minister, Salam Fayyad. The president of the Palestinian Authority received Fayyad Saturday at the Mukata’ah in Ramallah and put him in charge of expediting current business until his successor is appointed. The resignation comes after a long series of disputes between the two men, amid the financial and moral crisis of the Palestinian Authority.

Relations between Abbas and Fayyad, long-time partners at the head of the proto-Palestinian state in the West Bank, had been deteriorating for some time. They had recently opposed each other regarding the resignation of Finance Minister Nabil Qasis, which Fayyad accepted against the advice of Abbas.

Fayyad’s departure comes at a very bad time for the U.S., which is trying to relaunch negotiations between Israelis and Palestinians through Secretary of State John Kerry. Fayyad — a former senior official at the International Monetary Fund who was educated at the American University in Beirut and the University of Texas — was seen in Washington and European capitals as a favored interlocutor. But U.S. pressure on Abbas to refuse Fayyad’s departure may have backfired.

The Resentment of Fatah’s Old Guard

Polite, modest, pragmatic and efficient, Fayyad had managed the feat of transforming Arafat’s Palestinian Authority, undermined by chaos and corruption, into a government that was managed relatively well. Since his election in 2007, he has devoted himself to the establishment of viable institutions for the future Palestinian state. Notably, he introduced a budget and the payment of civil servants by bank transfers rather than hand to hand. A French diplomat had even compared him to a Palestinian Raymond Barre.

But Fayyad’s popularity among Western diplomats and international institutions had earned him a parallel and growing unpopularity on the Palestinian side.

When Fatah’s old guard — those historically close to Arafat — returned from exile with him after the Oslo Accords, they never forgave the newcomer, who had not participated in the battles of the Palestinian Liberation Organization, for terminating their system of stipends by removing them from the center of power.

Symbol of the Financial Crisis That Hit the Palestinian Authority

Hamas, the Islamist rival that demanded Fayyad’s resignation as a condition for reconciliation with Fatah, had long denounced the economist as a “U.S. lackey,” responsible for a “politics of collaboration” with Israel. In the end, for the Palestinian public, Fayyad became the symbol of the financial crisis that over several months launched the Palestinian Authority into a state of near-insolvency, financially strangled by Israel’s decision to seize the taxes collected on behalf of the Palestinians, a measure partially lifted last month.

For his part, Fayyad had spoken for several months of his personal failure: the course of his politics since 2007. Security cooperation with Israel has not brought anything in return to the Palestinian Authority, while its rival Hamas obtained the release of more than 1,000 prisoners in exchange for Gilad Shalit. Israeli settlements continue to eat away at the West Bank, and the creation of a viable Palestinian state, to which he had devoted himself, seems more distant than ever.

Among the names mentioned to succeed Fayyad is that of Mohammed Mustafa, director of the Palestinian Investment Fund. The new prime minister should be appointed in two weeks.