Jerusalem (AsiaNews/Agencies) – In his final report to road map mediators UN, US, EU and Russia, special envoy to the Palestinian National Authority (PNA) James Wolfensohn, has questioned the decision of Western powers to cut all but humanitarian aid to the Hamas-led Palestinian government.

Mr Wolfensohn, a former World Bank president, formally stepped down on Monday as economic co-ordinator for Gaza, saying the rise of Hamas made his job untenable.

After spending more than US$ 1 billion a year on assistance to the Palestinians, much of it to build government institutions and an economy needed to create a "viable Palestinian state", his report asked: "Will we now simply abandon these goals?"

The report noted that the UN and non-governmental organisations would not be able to fill the void if PNA institutions collapsed under Western pressure.

Mr Wolfensohn's office said the PNA's inability to pay salaries was already having an impact on the economy.

"The fiscal situation of the Authority has gone from bad to worse," the report said. By 2008, under this scenario, unemployment could reach 47 per cent and poverty 74 per cent. The World Bank estimates that real growth per capita will decline by 27 per cent this year alone.

"It would surprise me if one could win by getting all the kids out of school or starving the Palestinians. And I don't think anyone in the Quartet believes that to be the policy," Mr Wolfensohn said on Monday.