The Palestinian Authority, led by Prime Minister Ismail Haniyeh from the radical Islamic group Hamas, is facing its end. His finance minister, Omar Abdel Razek, has warned that the government will go bankrupt within the next two months if international aid -- cut off following Hamas's election victory in January -- doesn't resume flowing. "There's no way we can avoid the collapse," Abdel Razek told DER SPIEGEL.

The financial problems  still loom despite plenty of aid offers to keep the PA afloat. The Arab League has promised the Palestinian government around $50 million a month. But the Arab Bank in Cairo refuses to transfer the money for fear of being slapped with US sanctions. A call for help to several European banks including Commerzbank in Frankfurt has also been unsuccessful. The Islamists are now trying to obtain part of the money they need via accounts belonging to Palestinian businessmen and couriers carrying suitcases full of cash from Israel.

As the coffers empty, the security and humanitarian conditions -- especially in the Gaza Strip -- continue to deteriorate. Fighting between rival Palestinian factions left at least two dead in Gaza on Monday, as gunmen from Hamas and the Fatah party of Palestinian President Mahmoud Abbas took part in some of the worst violence since Hamas took over the government six weeks ago. Two Fatah members of the security forces were killed on Monday after Hamas fired a shoulder-held missile into their government jeep.

Aid organizations report that as international financial support has been cut and the two main Palestinian groups remain locked in their power struggle, some 10 percent of children under five are now undernourished in Gaza. Infant mortality rates have soared by 30 percent. A proposal by the European Commission to send aid for hospitals and medicine directly to the office of the moderate President Abbas has been rejected by the United States, which hopes the Palestinians will turn away from the Hamas radicals after they become fed up with their miserable living conditions.

But the popularity of Hamas -- which is considered a terrorist organization by both the United States and the European Union -- appears to be unshakable. And the fundamentalists are unwilling to give up power without a fight. The looming crisis has some Israeli security experts worried about spreading chaos throughout the region. "A collapse of the Palestinian Authority is not in the interest of either Israel or the West," a high-level official from Israel's domestic security agency Shin Bet told DER SPIEGEL.