Israel will transfer $100 million to the Palestinian Authority to help it cope with a severe economic crisis, the Prime Minister’s Office announced Tuesday.
The money, tax revenues and customs levies that Israel collects on behalf of the Palestinians but has held back in recent months as punishment for their unilateral bid for upgraded status at the UN, will help the Palestinian Authority meet payroll obligations and relieve pressure caused by a severe financial crisis.
According to the Prime Minister’s Office, the money transfer is a one-off measure “due to the financial hardship facing the PA.”
The international community as well as voices within Israel’s own security establishment urged the government to approve the transfer of the much needed cash, in part for fear that if the Palestinian Authority collapses, the Islamist Hamas organization will take its place in the West Bank.
PA Prime Minister Salam Fayyad told reporters earlier in January that the authority’s cash crunch has gradually worsened in recent years, reaching a point where the government is unable to pay the salaries of most government employees. He warned the situation may push more than 1.5 million out of a total of 4 million Palestinians into poverty.
In recent months, Arab states pledged to provide the PA with a $100 million monthly safety net, but have failed to follow through on the promise, Fayyad said.
The Palestinian Authority employs some 150,000 people, including civil servants and members of the security forces. About 60,000 PA employees live in Gaza and continue to draw salaries even though they were replaced by Hamas loyalists after the terror group took control of the Strip in 2007.
In recent weeks, Palestinian Authority employees took part in large demonstrations and strikes in the West Bank to protest the withholding of their wages.