KAI RYSSDAL: Condoleeza Rice said something intersting this afternoon. In that way she has of saying a lot without saying too much. The Secretary of State announced the U.S. is close to an agreement with the European Union. They're going to start sending money to the Palestinians again. For two months the US and the EU have blocked money for Hamas. Marketplace's Scott Tong reports.
SCOTT TONG: Judith Kipper of the Council on Foreign Relations says Shifa Hospital in Gaza has long struggled to get by. Then came the US/EU embargo — the cutoff of an annual $1 billion funding stream.
JUDITH KIPPER: People who need dialysis two or three times a week, they didn't have the tubes to connect the patients. They've run out of medicines, surgical supplies . . .
Aid groups call it a "deteriorating humanitarian situation," which the EU's trying to address. The first package of $126 million will go directly to Palestinian President Mahmoud Abbas. He heads the government's Fatah faction. The idea is to bypass Fatah's rival, Hamas til it renounces violence.
But David Schenker of the Washington Institute for Near East Policy wonders if some of the money will eventually end up in Hamas hands.
DAVID SCHENKER: I think a lot of this will be done ultimately in cash transactions. Which means it's going to be quite a chore to determine that you're not using organizations that are sympathetic to Hamas.
Even if the cash goes where it's intended, this is a financial Band-Aid. Fawaz Gerges of Sarah Lawrence College is now in Beirut.
FAWAZ GERGES: Who's going to pay the salaries of the 130,000 Palestnian workers? Neither the European Union nor the Arab States have volunteered to do so.
Many police officers and teachers haven't been paid since January. And until the Palestinian economy starts moving, he says, an unstable social and political situation will remain.
Meanwhile, the US says the EU aid plan looks promising.
In Washington, I'm Scott Tong for Marketplace.