Israeline, courtesy of the Israeli consulate, in NYC, (Nov 16) reported:

ISRAEL SUSPENDS FUNDING PA

Prime Minister Ehud Barak said today that Israel suspended funding the Palestinian Authority, and that necessary security precautions were being implemented in relation to this move, HAâ ARETZ reported. ãSometimes we must grit our teeth and continue the struggle, which may be long and hard and may require us to just stand it out,ä said Barak. Barak is scheduled to meet today with American Middle East Peace Envoy Dennis Ross as a follow up to their meeting on Wednesday to further discuss the possibility of convening a trilateral summit with U.S. President Clinton, PA Chairman Yasser Arafat. Barak emphasized that there would be no negotiations unless the level of violence is drastically reduced. In interviews to both Israel Radio and IDF radio today, Barak said that Israelis must prepare for a long fight with the Palestinians. ãWe are in for a long battle that will really decide our future in this country and it is a complex battle. These actions are accurate and are aimed at making it clear to the other side that this violence has a price for them and that continuing this violence won't win them anything from us,ä Barak said.

But Ha'aretz reported:

Ha'aretz: Treasury: Barak did not order to stop payments to PA - holding NIS 46.5 million due to Palestinian debts and bad cheques
By Moti Bassok, Ha'aretz Correspondent - Ha'aretz Bulletin November 16 2000

Finance Ministry officials say that Prime Minister Ehud Barak did not order the treasury to stop transferring funds to the Palestinian Authority. The transfer of funds to the PA in October was in fact delayed, but it was due to economic circumstances related to the Intifada in the West Bank and Gaza Strip.

The treasury's announcement contradicts Barak's earlier statement, that Israel had stopped funding the Palestinian Authority because of security considerations and as a sanction on the PA in response to the Intifada.

This month, Israel transferred NIS 67.5 million out of the NIS 114 million that it owes to the PA. The outstanding funds have been temporarily frozen due to Palestinian debts and bad cheques. A senior adviser at the Finance Ministry says that the amounts that Israel transfers each month fluctuate greatly, with the monthly average over the past two years reaching some NIS 200 million. The funds that are transferred to the PA are reimbursements for indirect taxes, VAT on Israeli exports and imports, customs and other import taxes, purchase taxes on local produce and excise tax on fuel.

The treasury said that Israel intends to honor its agreements with the Palestinians and to solve the financial problems together with the Palestinian Authority.