Cash crisis challenge to PLO leader: Yasser Arafat has run out of credit and is fast losing goodwill, writes Charles Richards

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YASSER ARAFAT is in trouble. It may not be fatal. His politicial obituary has been written prematurely too often in the past. He survived his ejection by the Jordanians in the Seventies which many feared (or hoped) would finish him. And he bounced back from his expulsion from Lebanon by the Israelis 10 years ago.

The chairman of the Palestine Liberation Organisation faces a very different challenge now. The criticism is of style and substance. He is being castigated both for the proposals he is making - to set up a Palestinian enclave in Jericho and the Gaza Strip as an interim Palestinian state - and for what is seen as his reluctance to share decision- making with other members of the Palestinian community.

Earlier this month the three leaders of the Palestinians in the occupied territories proferred their resignations to Mr Arafat over his failure to consult them (they were persuaded to stay within the fold). The co-opting of the seven members of the Palestinian negotiating team in the peace talks into the PLO - an astute political move - was taken without any vote.

For all the so-called democratic nature of the decision-making process, of consulting the different trends, of referring decisions to the Palestine National Council (PNC) - the Palestinians' parliament in exile - Mr Arafat has in effect done what he has wanted in the past. For he could afford to.

What has changed is money. Before, he could pay off dissidents with his cheque book. He kept a tight control of the PLO's purse-strings. Now he has not only run out of cash, he has run out of cheques. The PLO, the central institutional body of the Palestinian people, with its schools, clinics, welfare system and pensions, is broke.

The main benefactors in the Gulf have cut off their subventions to punish the PLO for its support for Iraq during the Gulf war. Palestinian diplomatic missions have laid off staff. PLO- backed newspapers have closed. Salaries are unpaid. The mood is divisive and acrimonious.

Mr Arafat still enjoys the support of the men of intellectual stature within the PLO, such as Abu Mazen, and Farouk Kaddoumi, the PLO's Foreign Minister. But the financial crisis is hitting the entire Palestinian community. The groundswell of criticism of Mr Arafat's leadership could provoke a call for his resignation at a meeting of the PNC.

Since the Sixties he has been the focus of the unity within the disparate strands of the nationalist movement. If he were removed, there would be no obvious successor, with the assassination in recent years of several of his heirs apparent.

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