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Editor's note: The following article derives from the author's section of a study by Clyde Mark and Kenneth Katzman titled "Hamas and Palestinian Islamic Jihad: Recent Developments, Sources of Support, and Implications for U.S. Policy," published by the Congressional Research Service on December 12, 1994. The publication of this piece by a branch of the U.S. government prompted strong protests from Fathi ash-Shiqaqi, secretary-general of Islamic Jihad; and Ahmad Dastmalchian, Iran's ambassador to Jordan (both of whom are mentioned in the piece). The Jordanian government also indicated an intent to look into information provided in that paper. We are pleased to provide an updated and expanded version of Mr. Katzman's important study.

The two radical Palestinian Islamist groups, Hamas (Islamic Resistance Movement) and Islamic Jihad, have used violence with such great effect that the peace process between Israel and the Palestine Liberation Organization (PLO) has nearly broken down. To further the peace process, the U.S. government has begun making efforts to weaken the two groups.

This task is rendered easier by the fact that both groups rely on outside support to sustain their operations. They receive financial aid from many Middle Eastern countries--including Iran, Syria, Jordan, and the Persian Gulf monarchies--and even from the United States. The aid takes many forms, ranging from small private contributions raised in mosques to large grants from wealthy contributors and governments.

What steps can Washington take to restrict contributions to Hamas and Islamic Jihad? What is the likelihood that these efforts will seriously erode the radicals' attempts to sabotage the peace process?


Radical Islamist groups appear to attract about one-fifth of the Palestinian population's support. (A recent poll reported that 16.6 percent of Palestinians in the West Bank and Gaza Strip claim political affiliation with Hamas, and 2.6 percent with Islamic Jihad.)1 Some of these supporters provide funds in the form of contributions or levies; Hamas reportedly imposes a religious tax (zakat) of 2.5 percent on the wages of its members in the territories, sometimes by threatening violence to compel payment.2

Despite their local support, these two groups clearly depend on funding and other supplies from several Middle Eastern states, chief among them Iran. The Islamic Republic of Iran shares a basic outlook with Hamas and Islamic Jihad. All three believe in an Islamic state encompassing all the territory that was formerly British Palestine. All three oppose compromise with Israel, although some Hamas leaders may be open to joining the peace process.

Tehran is the most vocal state backer of the radical Palestinian Islamic groups. During a visit to the United Nations in New York in April 1994, Iran's Foreign Minister `Ali Akbar Velayati said his country would continue to provide "political and emotional" support for Palestinian groups that rejected the September 1993 Israel-PLO Declaration of Principles (DoP), though he denied Iran provided military aid to those groups. For their part, Hamas leaders have said that Hamas and Iran share an "identical view in the strategic outlook towards the Palestinian cause in its Islamic dimension,"3 and Palestinian Islamic Jihad leaders have acknowledged Iranian political support.

Since the DoP was signed, several Iranian officials, including the commander in chief of Iran's Revolutionary Guard, have met with Hamas and Islamic Jihad leaders in Damascus, then lauded these organizations and their goals.4 Press reports indicate that the Revolutionary Guard is training Hamas and Islamic Jihad activists in Lebanon and in the Sudan (the guard maintains a contingent of troops in both places),5 though hard evidence of Iranian military training of Islamic militants is lacking.

It is increasingly clear that Iran provides funding to the Palestinian Islamist groups, although the funding levels are not precisely known. Yasir Arafat said in 1992 that Iran had provided $30 million to Hamas, although he did not indicate a time frame for these funds.6 A Lebanese magazine that often has proved reliable on Iranian affairs reported that Hamas would, as of January 1994, receive $10 million (presumably per year) from Iran, to be derived from spot sales in Rotterdam of Iranian oil.7 In the aftermath of the Tel Aviv bus bombing in October 1994, Israel's ambassador to the United States, Itamar Rabinovich, said, "I think that speaking in state or government terms, Iran is the address,"8 by which he meant that Iran is the main source of external funding for Hamas.

The State Department's Office of Counterterrorism supports the Israeli allegations of Iranian funding, noting in its report on international terrorism for 1993 that Hamas and Islamic Jihad receive funding from Iran.9 In testimony before the Senate Intelligence Committee on January 10, 1995, outgoing director of central intelligence James Woolsey said that Iran had provided over $100 million to Hamas, without giving a time period over which those funds were provided.

Palestinian Islamist leaders also have confirmed Iranian aid. Fathi ash-Shiqaqi, secretary-general of Islamic Jihad, has admitted that his group receives Iranian funds.10 Hamas's representative to Iran said in 1993 that "there were forms of assistance from the Iranian people to help the steadfastness of the Palestinian people in the occupied territories" but he denied that Hamas had received as much as the $30 million from Iran alleged by Arafat.11

In addition to direct aid from Tehran, the radical Palestinian Islamist groups appear to have growing links with Hizbullah, the radical Shi`i Islamist organization closely allied to Iran. The two parties have jointly participated in demonstrations in Beirut denouncing the Israel-PLO accord of September 13, 1993, and the Jordan-Israel peace treaty of October 26, 1994. Hamas militants who kidnapped Israeli soldier Nachshon Waxman in October 1994 demanded the release not only of Palestinian Islamist leaders in Israeli hands but also of Hizbullah leaders kidnapped by Israel (Sheikh `Abd al-Karim `Ubayd and Mustafa Dirani).12 Unconfirmed reports maintain that Hizbullah is training Islamic Jihad (and presumably also Hamas) fighters in Lebanon.13


Syria. The State Department reports that the Syrian government may be providing funds to Islamic Jihad.14 Damascus allows representatives of Hamas and Islamic Jihad--along with eight of their anti-Arafat Palestinian allies--to operate in Syria as a rejectionist front. Fathi ash-Shiqaqi directs Islamic Jihad from his base in Damascus, although he denies any role in planning military operations against Israel. Perhaps more significant, the Syrians tacitly approve of cooperation in Lebanon between the Palestinian Islamist groups, Hizbullah, and Iran. Hizbullah and Iran's Revolutionary Guard operate in Lebanon in areas, such as the Bekaa Valley, that are under the direct control of Syria's approximately 35,000 troops in Lebanon. On the other hand, no official U.S. body alleges Syrian funding for Hamas, and observers in Damascus believe the authorities circumscribe the activities of both Hamas and Islamic Jihad in Syria.

Jordan. Until recently, the Jordanian authorities had tacitly supported the Muslim Brethren in the West Bank and, through it, Hamas, believing that building up Hamas would help weaken the influence of the PLO in the West Bank. They aided Hamas through Jordan's Waqf (Islamic Endowments) Ministry, which maintains mosques and funds Muslim religious leaders in the West Bank.15 Since 1989, when parliamentary elections were restored, the Jordanian government has increasingly become concerned that Hamas's militancy might radicalize its sister organization in Jordan, the Muslim Brethren, now a powerful bloc in the Jordanian parliament. In April 1994, reportedly with some U.S. urging, King Husayn declared Hamas illegal in Jordan, although his government has not cracked down on or expelled the organization.

Circumstantial evidence suggests that Amman unwittingly or reluctantly hosts a possible Iranian conduit to Hamas. Tehran has no presence in the West Bank or Gaza Strip, where Hamas operates, but in 1992, it reopened an embassy in Jordan and a year later appointed Ahmad Dastmalchian as ambassador to Jordan. Because of its proximity and relatively open borders, Amman offers a route for the Iranians to influence developments in the West Bank. Based on Dastmalchian's background--he served during 1987-90 in Lebanon, where he helped funnel Iranian assistance to Hizbullah--the Jordanians reportedly hesitated to accept his assignment to Amman, fearful he would back Islamist extremists in their country and funnel aid to Hamas.

In seeming confirmation of this fear, the Jordanians subsequently demanded that Tehran cut its embassy staff in Amman from forty persons to nine. Though it allowed Dastmalchian to remain in place King Husayn announced that his government was closely watching the Iranian embassy.16 If reports of Iranian aid's flowing through Jordan are true, it is possible that Dastmalchian is aiding Hamas through Iran's embassy in Amman.

Persian Gulf states. The State Department believes that Hamas receives funding from private contributors in Saudi Arabia and the other rich, moderate Arab states of the Persian Gulf.17 Exact estimates of aid from gulf-state contributors are difficult to obtain, but one report quotes Western intelligence sources to the effect that Hamas gets "millions" of dollars annually from this source.18

Hamas reportedly has an office in Saudi Arabia. In April 1993, a Hamas delegation visited Qatar to discuss aid to Hamas and the Palestinian people from that gulf state and the opening of a Hamas political office there.19 Noting that the oil monarchies have supported the Arab-Israeli peace process, their reluctance to block private contributions to Hamas and Islamic Jihad may stem from an unwillingness to offend wealthy and powerful citizens or from a fear of provoking terrorist attacks.


The debate over Hamas links to the United States began in January 1993, when Israeli journalists and their government alleged that Hamas directed its operations from U.S.-based command centers. These charges stemmed from information obtained in the January 1993 arrest of two naturalized Arab-Americans (Muhammad Jarad and Muhammad Salah) for carrying money and instructions from the United States to Hamas activists in the occupied territories. On January 3, 1995, a Ramallah court convicted Salah of transferring funds to Hamas's military arm and sentenced him to five years in prison.

The State Department acknowledges that Hamas has sympathizers in the United States but argues there is "no evidence to prove that Hamas terrorist operations are working out of the United States."20 Unsatisfied, several members of Congress--including Representative Charles Schumer (Democrat of New York) and Senator Alfonse D'Amato (Republican of New York)--called for Justice Department investigations of suspected Hamas activity in the United States.21 The administration did step up its efforts to learn about radical Islamic networks in the United States but took no significant steps against them.

The issue of private U.S. funding for Hamas again flared up in the aftermath of the October 19, 1994, bus bombing in Tel Aviv. Israeli officials--especially Israel's consul general in New York, Colette Avital--reiterated that Hamas was operating in the United States. Rabinovich, however, acknowledged that U.S. law enforcement agencies had worked diligently to curb Hamas activity and said Israel was satisfied with U.S. efforts to prevent funding of Hamas from the United States.22 Five days after the bombing, Secretary of State Warren Christopher promised a major effort to cut off private U.S. funding for Hamas, including support for the passage of new legislation, if necessary.23 On January 24, 1995, President Clinton issued an executive order blocking the assets of twelve "terrorist organizations which threaten to disrupt the Middle East peace process," including Hamas, Palestinian Islamic Jihad, and Hizbullah,24 and prohibiting financial transactions between U.S. nationals and those organizations. The administration subsequently submitted to Congress draft legislation to implement the executive order. The administration bill was introduced in February 1995 in the Senate by Senator Joseph Biden (Democrat of Delaware) and in the House by Representative Schumer.

No one knows the full extent of Hamas fundraising activities in the United States, though State Department officials are reported to have acknowledged that Hamas receives "millions" of dollars each year from donors in America.25 Some press reports suggest that private money from the United States and Britain may supply Hamas with 33 to 40 percent of its budget26 (estimated by Israeli sources at $30 million per year).27 Investigative journalist Steven Emerson believes Hamas gets anywhere from 40 to 80 percent of its money from contributors in the United States. Emerson presented his allegations of extensive Hamas fundraising and political activity in the United States on CBS's 60 Minutes on November 13, 1994, and in a PBS special entitled "Jihad in America" on November 21, 1994, which documented radical Islamic gatherings taking place in the United States without proving that persons resident in the United States orchestrate radical Islamic activity in the Middle East. Oliver Revell, a former high-ranking official in the Federal Bureau of Investigation, says that Islamist organizations in the United States publish and distribute radical Islamist literature in America, engage in terrorist training operations there, and frequently host radical Islamist religious leaders who visit the United States to raise funds.28


In the wake of continuing Hamas and Islamic Jihad violence against Israel, the U.S. government's immediate task is to deny support to radical Palestinian Islamic groups. Given these groups' reliance on outside support, the success of Washington's effort depends in large measure on the leverage it wields over foreign states.

The U.S. government has no diplomatic relations with Tehran, the Palestinian Islamist groups' most vocal outside supporter, making it difficult to influence Iranian support for the radical Palestinian groups. Washington has adopted a broad package of unilateral sanctions against Iran, including bans on aid in any form, strong Iranian imports, and U.S. exports of items with possible military applications. But economic sanctions are a relatively blunt instrument that might help keep Iran militarily weak (conventional arms acquisitions are expensive) without reducing its support for radical Islamic movements. (One estimate holds that it costs only about $4,000 per year to fund a two- or three-man grouping of Palestinian Islamist guerrillas on the West Bank or Gaza Strip.)29 Also, sanctions might weaken Iran's President `Ali Akbar Hashemi Rafsanjani, who has repeatedly called for an end to Iran's "foreign adventurism" (most recently at a June 7, 1994 news conference)30 and wants Iran to have normal relations with the rest of the world.

U.N. or multilateral sanctions on Iran similar to those imposed on Iraq (for example, a ban on oil exports) would be unlikely to curb Iran's support for radical Islamic movements, for such sanctions would probably not win international support; and funding radical groups abroad is an inexpensive activity.

Some consideration might be given to direct U.S. confrontation with those in Iran responsible for supporting radical Islamic movements. Measures directed specifically at the Revolutionary Guard and its radical allies might have more direct impact in dampening Iranian support for the radical Palestinian. U.S. air forces could conduct strikes on guard bases in Lebanon, the Sudan, or even in Iran itself, including the Revolutionary Guard headquarters in Tehran. Alternately, Washington could pressure the Jordanians to expel Iran's Ambassador Dastmalchian, or the Syrians to stop allowing Iranian resupplying of Hizbullah through Damascus.

None of these actions would immediately stop Iranian support for radical Islamic movements, but strong and steady pressure on the Iranian factions that support radical Islamic movements could, over time, make the costs to Tehran outweigh the benefits.

Strong and steady pressure on the Iranian factions that support radical Islamic movements could, over time, make the costs to Tehran outweigh the benefits.

Syria is another story, for the U.S. government enjoys somewhat more leverage there. Damascus wants to be removed from the U.S. list of states supporting terrorism, and that would require it to curb Hamas and Islamic Jihad. In the wake of the January 1995 Islamic Jihad attack on an Israeli bus stop, the U.S. government protested to Damascus about its continued harboring of terrorist groups and pressed it to expel Shiqaqi, but the Asad regime maintains that Islamic Jihad is not violating Syrian law and that it will not expel him. Alternately, if the Asad regime is uncooperative on terrorism, the U.S. government can impose additional sanctions (such as curbing the ever-larger American involvement in Syria's oil industry).

As the ultimate guarantor of their security, the U.S. government has real leverage over the Persian Gulf monarchies and Jordan; it can use this in the effort to persuade them to restrict private contributions to Hamas and Islamic Jihad. Washington has raised the issue in bilateral U.S.-Saudi discussions, and the Saudis have issued some regulations restricting contributions by their private citizens.31 In the Jordanian case, Washington can tie foreign aid and debt forgiveness to Amman's efforts.

Short of direct military or covert pressure on Tehran's radical factions, primarily the Revolutionary Guard and its associates in the Iranian foreign ministry, Washington's best near-term hope probably lies in getting Syria and Jordan to deny Iran a direct conduit to the radical Palestinian groups.

As for domestic U.S. efforts, the August 1994 crime bill criminalized the provision of money and equipment for specific acts of terrorism, then President Clinton's executive order froze the assets of twelve Middle Eastern terrorist groups. In February 1995, the administration submitted to Congress draft legislation to strengthen that executive order. New anti-terrorism laws are likely to be enacted, but many members of Congress--as well as Arab-American and Muslim-American groups--wish to be very careful not to undermine civil liberties.

In other words, the U.S. government has begun to take real steps to prevent the funding of radical Islamic groups. But these are imperfect efforts that probably will not produce results for some time to come. Radical Islamic movements are generated in the Middle East, supported by states in that region, and therefore must primarily be combatted there, even through Washington cannot exercise the leverage there that it does within the United States itself.


1 The poll was conducted by the Nablus-based Center for Palestine Research and Studies during Dec.. 29-31, and was sponsored and published in Washington, D.C. by the International Republican Institute. For all of 1994, an average of 14.1% supported Hamas, and 3.4% supported Islamic Jihad. For more on the polls, see the article by Lauren G. Ross and Nader Izzat Sa'id on pages xx-xx of this issue.
2 Paul Wilkinson, "Hamas--An Assessment," Jane's Intelligence Review, July 1993, p. 313.
3 Hamas Says It Sees Iran as Strategic Ally.Reuters, Feb. 28, 1993.
4 Iranian Official Discusses Ways to Foil Peace Pact.Reuters, Nov. 17, 1993.
5 David Horowitz with Ehud Ya'ari, "Can Hamas Blow Up the Peace Process?"The Jerusalem Report, Nov. 17, 1994. pp. 23-4.
6 Al-Hayat (London), Dec. 17, 1992.
7 $10 Million Reportedly Granted to Hamas. Al-Shira' (Beirut), Dec. 13, 1993, p. 9.
8 Itamar Rabinovich Press Conference, Washington, D.C.Reuters, Oct. 19, 1994.
9 U.S. Department of State, Office of the Coordinator for Counterterrorism, Patterns of Global Terrorism: 1993, Apr.Apr. 1994, pp. 45-46, 56.
10 Al-Hayat, Jan. 13, 1994, p. 6, in Foreign Broadcast Information Service, Daily Report: Near East and South Asia, Jan. 19, 1994.
11 Hamas Says It Sees Iran as Strategic Ally.Reuters, Feb. 28, 1993.
12 Gellman, Barton. Hamas Kidnaps Israeli, Threatens to Kill Him. The Washington Post, Oct. 12, 1994. p.A27.
13 Background on Hamas, inMiddle East Week,. Center for Near East Research. Dec. 29, 1992. p.5.
14 U.S. Department of State, Patterns of Global Terrorism: 1993, p. 56. This section on Syria derives in part from information gathered by the author in Damascus in Jan. 1995.
15 Clinton Bailey, Hamas: The Fundamentalist Challenge to the PLO, research memorandum no. 19 (Washington, D.C.: Washington Institute for Near East Policy, 1992), pp. 16-17.
16 Boustany, Nora. Jordan Expels 21 Iranian Diplomats.The Washington Post, Feb. 4, 1994. p.A26.
17 U.S. Department of State, Patterns of Global Terrorism: 1993, p. 46.
18 Sieff, Martin. U.S. Aims at Hamas' Pocketbook.The Washington Times, Oct. 26, 1994. p.1.
19 Fouad, Ashraf. Hamas Team in Qatar for Political, Financial Aid. Reuters, Apr. 3, 1993.
20 Nelan, Bruce. Hamas and the Heartland.Time, Feb. 15, 1993. pp. 37-8.
21 Congressional Record, daily ed., Feb. 2, 1993; p. H 320; and Feb. 18, 1993. p. S1931.
22 Itamar Rabinovich Press Conference. Reuters, Oct. 19, 1994.
23 Worsnip, Patrick. U.S. Hints at Laws to Stop Hamas Funding. Reuters, Oct. 24, 1994.
24 The other nine groups were Abu Nidal Organization, Democratic Front for the Liberation of Palestine, Islamic Gama'at, Jihad, Kach, Kahane Chai, Palestine Liberation Front--Abu Abbas faction, Popular Front for the Liberation of Palestine, and Popular Front for the Liberation of Palestine--General Command. 25 Greenhouse, Steven. U.S. Hints at Better Ties if Syria Signs Peace Pact With Israel. The New York Times, Oct. 25, 1994. p.A8.
26 Sieff, Martin. U.S. Aims at Hamas' Pocketbook. The Washington Times, Oct. 26, 1994. p.1.
27 Ibrahim, Youssef. Palestinian Religious Militants: Why Their Ranks Are Growing. The New York Times, Nov. 8, 1994. p.A12.
28 U.S. News and World Report, Oct. 31, 1994. p.44; Schweid, Barry. Ex-FBI Official Says U.S. Provides Sanctuary for Muslim Militants; Reuters, Nov. 17, 1994; and Oliver Revell, "Protecting America," Middle East Quarterly, Mar. 1995, pp. 3-8.
29 See, Hoffman, David. Hamas' Resilience Surprises Israel. The Washington Post, Feb. 3, 1993. p. A19.
30 See IRIB Television First Program Network, June 7, 1994, in Foreign Broadcast Information Service, Daily Report: Near East and South Asia, June 10, 1994.
31 State Department Briefing. Reuters, June 14, 1994.