Palestinians start budget crisis talks

By REUTERS
February 6, 2012 15:41

 
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RAMALLAH - Palestinian Authority Prime Minister Salam Fayyad met union leaders and employers on Monday to pursue agreement on the 2012 budget after a public outcry against austerity measures thwarted his first plan to tackle a debt crisis.

An abrupt freeze in more than $150 million in US aid last year has slowed the Palestinian economy, widening the deficit to $1.1 billion after rapid growth in 2009-2010.

Washington cut off funding after PA President Mahmoud Abbas made a bid for UN recognition of Palestinian statehood, which Israel - backed by Washington - insists can be achieved only through negotiation and a peace treaty.

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