The Palestinian Authority agreed to return money

U.S. State Department
Daily Press Briefing
Sean McCormack, Spokesman
Washington, DC
February 17, 2006

QUESTION: Can I just follow up with one other thing? The New York Times said today that the U.S. has asked the Palestinians to return $50 million which is going to be used for (inaudible) water projects and other projects. Is that correct -- this money that was originally going to be used by various ministries, is that --

MR. MCCORMACK: That is correct. That is correct. There was $50 million disbursed to the Palestinian Authority in 2005. It was provided to the -- well, it was a past government, now that there's a caretaker government, for new infrastructure projects in Gaza. It's part of a broader effort to ensure Palestinian -- or to assist with Palestinian economic revival in the wake of Israel's withdrawal from Gaza. And this is all part of our program of reviewing our assistance programs. We talked to the Palestinian Authority about this issue, found out that there was still -- the vast majority of this money is still in the bank. And so in the interest of seeing that this fund -- these funds not potentially make their way into the coffers of a future Palestinian Government that might not recognize the right of Israel to exist, might not meet those Quartet obligations, we've asked for it to be returned. And the Palestinian Authority has agreed to return it.