As Prime Minister Salam Fayyad quits after a feud with President Abbas, we ask how will it impact on the peace process.
|The Palestinian prime minister has resigned after a simmering feud with the President Mahmoud Abbas.
Salam Fayyad leaves an economy in crisis and the government in disarray, just as the US was making a new push for peace in the Middle East.
He was educated in the United States, and worked for both the World Bank and the International Monetary Fund. He has been credited with laying some of the groundwork for a future Palestinian state.
But during his time as Palestine’s prime minister, Fayyad was facing problems over the handling of the economy, his strong stance against corruption, the extent of his authority, and a strained relationship with President Maumoud Abbas.
He served twice as Palestinian finance minister, before being appointed prime minister in 2007, following the take over of Gaza by Hamas.
He is admired in the West and even in Israel, with Haaretznewspaper once describing him as everyone’s favourite Palestinian.
However the Palestinian Authority (PA) has been in crisis for months, public servants have not been paid, and there have been protests over price rises and tax hikes.
The US government has cut the amount of aid it gives the PA, Israel often delays transferring tax payments and Arab allies have failed to deliver promised assistance.
Outgoing finance minister Nabil Qassis forecast the PA’s budget deficit for this year would reach $1.4bn. In 2005, it stood at around $800m.
Latest figures from the World Bank showed economic growth slowed to a little over six percent last year, down from 11 percent in 2010 and 2011.
And Gross Domestic Product, the value of all goods and services, is expected to slow even more this year, to 4.7 percent in the West Bank and six percent in Gaza.
However, the tipping point for Fayyad came when his finance minister stepped down – Fayyad accepted his resignation but Abbas overruled him.
Politically independent, Fayyad was also vulnerable to pressure from the main Palestinian factions: Abbas’ Fatah party, and Hamas, which governs Gaza.
And some saw him as an obstacle to reconciliation between the two groups.
Following the news of Fayyad’s resignation was announced, Sami Abu Zuhri, Hamas spokesperson said: “Accepting the resignation of Salaam Fayyad has no relation at all with the Palestinian reconciliation agreement.
“It is related to the differences between Salaam Fayyad and the Fatah movement, and the Fatah movement demands to outcast him, which was obvious at the last Fatah revolution committee meeting,” he said.
So are these irreconciliable differences? And what impact will Salam Fayyad’s resignation have on the Israel-Palestine peace process?
Inside Story, with presenter Ghida Fakhry, discusses with guests:Ghassan Khatib, a former government spokesman under Palestinian prime minister Salam Fayyad; Osama Hamdan, head of international relations for Hamas; and Richard Weitz, senior fellow and director of the Center for Political-Military Analysis at the Hudson Institute.