Constraints on Aid Conditionality: The case of the European Commission and the Palestinian Authority

The international community has come in for a great deal of criticism in relation to the Israeli-Palestinian conflict and especially within the Palestinian territories occupied by Israel since the 1967 war.  The donors who dominate the international community are accused of shaping and dictating the development of Palestinian political, economic and social life.

BY DR GUY BURTON  | October 07, 2012


This claim is based on their ability to impose their agenda on a relatively weak and dependent Palestinian community through the use of their financial assistance.

The underlying assumption associated with this perspective is that power lies with the donor rather than the Palestinian recipients.  Indeed, the Palestinian case is both pertinent and unique.  It is especially pertinent because it is one where the general assumption is that donors are largely in control of the aid relationship while Palestinians are denied agency as a result.  It is also unique because Palestinians are one of the largest recipients of donor aid per capita in the world.  As a result, the implications of donor conditionality and their impact are therefore magnified in the Palestinian context, providing a useful insight for other cases of aid and aid conditionality.  Moreover, it arguably leads to a relatively weak position for Palestinians, since their reliance on donor assistance should rob them of their agency.

Given these issues then, the criticism of the international community and the lack of Palestinian agency are evident in both direct and indirect ways.  First, in terms of direct actions, foreign donors stand accused of dictating the terms on which aid is provided in the occupied Palestinian territory (OPT) of the West Bank and Gaza. Both the US and European Union (EU) have come in for particular attention in this regard, through the requirements that they make of Palestinian beneficiaries not to make use of their financial resources in ways which may assist ‘terror’ organisations like the Islamist political party, Hamas.  Second, donors are accused of setting the wider agenda for development through their selective support of the Palestinian leadership prepared to implement their preferred policies, in particular those related to structural readjustment, liberalisation programmes in the economic and social spheres and the expansion of security services and their reform. The result is that in both cases donors are seen to ‘condition’ their assistance.

But to what extent is this state of affairs accurate?  Is it really the case that donors dominate Palestinian political life?  This article challenges this assumption by studying the relationship between donor and recipient in the Palestinian context through the specific case of the European Commission (EC) and the Palestinian Authority (PA).  Particular attention is given to the 2006-07 period when the EC failed to realise its objectives.  Indeed, contrary to the assumptions made about donors in the OPT, the EC has not been as successful at imposing its objectives as is sometimes believed.  While it has certainly sought to impose its agenda on the political, economic and social dimensions of Palestinian life, it has not completely succeeded in this regard.  By analysing the role of aid conditionality, the article accounts for the ways in which the EC appears to have achieved its goals while also illustrating the ways in which it has not.  Specifically, the article notes the importance of structure has been largely overlooked in accounts of why conditionality may fail.  The case of the EC and the PA therefore provides a useful account of how this can happen, where despite pursuing its own agenda, the EC found itself undermined in a number of indirect ways.

© Copyright 2012 by CESRAN
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