Israel releases Palestinian funds

Israeli officials said Friday that they had transferred $100 million in withheld revenues to Palestinian Authority President Mahmoud Abbas.

Israeli Prime Minister Ehud Olmert agreed to the move during a meeting with Abbas last month. Israel began withholding about $50 million monthly in taxes and customs duties last year after the militant Hamas movement took control of the Palestinian government following elections.

Israel described the transfer as part of an effort to bolster the weakened Abbas, a relative moderate from Hamas’ main rival, Fatah. The $100 million represents less than one-third of the money Israel has collected on behalf of the Palestinian Authority and refuses to relinquish.

Israeli officials said the money was being channeled to Abbas’ office rather than to any ministry of the Palestinian Authority in order to maintain an aid embargo against Hamas, which Israel and much of the West consider a terrorist group.

“The money is not to go to the Hamas-controlled government. The money is to support the Palestinian people, and [Abbas] will be distributing it,” said Mark Regev, a spokesman for the Israeli Foreign Ministry.

Palestinian officials said the funds would help pay companies that supply hospitals, schools and farms.

The transfer, one of several modest concessions promised by Olmert during the Dec. 23 summit, could help the Palestinian leader in his political standoff with Hamas.

Despite months of negotiations, Fatah and Hamas haven’t agreed on terms of a power-sharing arrangement that would break the Western aid embargo.

Abbas is expected to meet today in Damascus, Syria, with Khaled Meshaal, the exiled Hamas political leader, amid fresh efforts to break the months-long impasse.

Abbas previously declared talks at a dead end, saying he would call early elections for the presidency and parliament. But mediators have continued trying to coax the two sides into agreeing on a joint government under terms that could satisfy the West.

Mohammed Dahlan, an Abbas confidant, said Friday that the president might meet with Meshaal but would not engage in negotiations. Abbas said Friday that he would proceed with elections if the latest efforts failed.

Past talks snagged over the distribution of ministerial posts and Hamas’ refusal to recognize Israel. Western nations demand that the government accept the Jewish state’s right to exist, renounce violence and agree to abide by past Israeli-Palestinian accords.

Meshaal is considered more strident than some of his Hamas counterparts in the Gaza Strip and has torpedoed past proposals. He also holds veto power over a proposed prisoner swap under which Israel would free jailed Palestinians in return for the release of Cpl. Gilad Shalit, who was captured by Hamas militants in June.

In other developments Friday, Israeli officials said Defense Minister Amir Peretz had frozen plans for construction of new housing for Jewish settlers in the West Bank. The plans for up to 100 homes at a former base, called Maskiot, drew wide international criticism and protests from Palestinian officials and Israeli peace advocates.

Critics said the project would violate Israel’s vow to freeze settlement activity under the U.S.-backed peace blueprint known as the road map. Israeli officials said Maskiot was approved more than 20 years ago.

The community, near the Jordanian border, would initially house settlers evicted from the Gaza Strip during Israel’s unilateral withdrawal in 2005.

Security officials said Peretz ordered the freeze two weeks ago to further study the matter. He is locked in a struggle for control of the Labor Party.

ellingwood@latimes.com