BRUSSELS, Feb 27 (AFP): The European Commission has earmarked 120 million euros (142 million dollars) in much-needed funds for the Palestinians, EU external relations commissioner Benita Ferrero-Waldner said Monday.
The European Union's executive arm would release the funds to help the Palestinian Authority's transition government pay for its basic needs, such as energy bills and salaries.
"Today, I will annonce (to EU foreign ministers) a very substantial package of assistance to meet the basic needs" of the Palestinians, the commissioner told journalists ahead of a meeting of the ministers.
The Palestinian Authority (PA) is desperate for funds since Israel imposed sanctions on the incoming Hamas-led government, including a freeze on paying customs duties, worth around 50 million dollars a month, travel restrictions on people affiliated with Hamas and extra security checks.
Breaking down the total EU funds, Ferrero-Waldner said that 40 million euros would be used directly for the PA's energy bills and there would be 64 million euros in direct aid channelled through UN agencies.
On top of that, the commission aimed to release 17.5 million euros from a World Bank trust fund to pay the transition government's salaries.
The European Union is the biggest provider of aid to the Palestinians but it was put in a delicate position after Hamas, which figures on the bloc's terror blacklist, easily won last month's legislative elections.
EU foreign ministers are to discuss the situation but are not expected to take a clear position on Hamas until the new government is formed and its position on recognising Israel, renouncing violence and working peacefully for a two-state solution is made clear.
Ferrero-Waldner said the commission was releasing the funds because "we see the political necessity to support (Mahmud) Abbas", the Palestinian president and overseer of the outgoing government.