Finance Minister Moshe Kahlon held rare direct talks Sunday night with Palestinian Authority Prime Minister Rami Hamdallah in Ramallah, in which the two sides discussed bilateral financial relations as well Israel’s settlement policy.
The meeting came amid an American push to improve economic ties between the Palestinians and Israel as part of a larger plan to ultimately strike a peace deal. It also comes with the Fatah faction, which presides over the PA, in the midst of a process of reconciliation with its rival Hamas, the terror group that rules the Gaza Strip. Israel has vowed not to engage in peace talks with the PA until Hamas renounces all violence and recognizes the Jewish state.
The meeting was also attended by PA Civil Affairs Minister Hussein al-Sheikh; the head of the PA’s General Intelligence Service, Majid Faraj; PA Finance Minister Shukri Bishara; and on the Israeli side, Maj. Gen. Yoav Mordechai, who heads the Coordination of Government Activities in the Territories, the Defense Ministry branch that liaises with the Palestinians on civil and security affairs.
It was the second meeting between Kahlon and the PA prime minister this year.
US President Donald Trump’s special envoy to the Israeli-Palestinian peace process, Jason Greenblatt, said in a tweet Monday morning that “important progress” was made and “meaningful steps” were taken “on key economic issues – revenues, customs, and investment – that help support the search for peace.”
Kahlon’s office declined to comment on the meeting, which Hebrew-language media said came about due to “American pressure.”
On the other side, the PA’s officials news agency Wafa released a detailed readout of the meeting.
According to the report, the sides discussed a series of important issues, foremost among them recent Israeli settlement announcements, Palestinian efforts to have the blockade on the Gaza Strip lifted, and financial matters.
The Palestinians reportedly discussed Israel’s decision to recently allow for thousands of new housing units throughout the West Bank and Jerusalem. The Palestinians, the report said, especially protested plans to build a new neighborhood in northern Jerusalem near the Palestinian towns of Kfar Akeb and Qalandiya, which is slated to contain 10,000 new Jewish homes.
The Palestinian officials also protested attacks against Palestinian olive farmers by Israeli settlers and the entering of “religious extremists” onto the Temple Mount in Jerusalem, the readout said.
Regarding financial matters, the report said the two sides discussed PA financial claims, trade agreements, and banking relationships.
The Palestinians also reportedly discussed a series of Israeli financial concessions made in May at the request of the US administration, including allowing more Palestinian construction in Area C of the West Bank; the expansion of Palestinian towns in the face of overcrowding; the expansion of the industrial zone in Tarqumiya, south of Hebron; and 24-hour service at the heavily trafficked Allenby Crossing between the PA and Jordan.
Last week, Finance Ministry Director General Shai Babad led a delegation to the Palestinian city of Rawabi, where Israeli restrictions have hampered progress on the billion-dollar project. The Americans, the Walla news site reported, are insistent Israel allow work on the sole access road to the city.
The US peace push reportedly included a visit last week to Saudi Arabia by President Trump’s son-in-law and chief Middle East adviser, Jared Kushner.
On Sunday night, PA President Mahmoud Abbas, speaking to a group of former Israeli lawmakers at his headquarters in Ramallah, said “the Americans have assured him they will announce their support for a two-state solution soon,” Haaretz reported.
Abbas reportedly told the former politicians that should his Fatah party form a unity government with Hamas, he would not appoint to his government Hamas officials who don’t publicly recognize Israel.
Abbas’s office has not confirmed this report.
Under a reconciliation agreement reached earlier this month between Hamas and Fatah, the PA government is to reassume civilian control of Gaza by December 1.
In the wake of the agreement, Israel’s top-level security cabinet said the government would not hold peace talks with the PA unless Hamas renounced terrorism and recognized the Jewish state.
White House Mideast peace envoy Greenblatt has echoed the demand, saying that any Palestinian government must adhere to certain “basic requirements,” namely renouncing violence and recognizing Israel.
The Abbas-led Palestine Liberation Organization has recognized Israel, but Hamas has not. The Gaza-based terrorist organization has fought three wars with Israel since 2008, and openly calls for its destruction.