Officials said to warn PA’s economic woes amid pandemic could fuel violence
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Officials said to warn PA’s economic woes amid pandemic could fuel violence

Security sources say upheaval from contraction in growth could be exacerbated by potential Israeli annexation, leading to West Bank unrest

A Palestinian confronts IDF soldiers during a demonstration against Israeli settlements in the northern West Bank village of al-Sawiya on May 15, 2020, as Palestinians mark Nakba Day, or the 'catastrophe' of the displacement of Palestinians in the war during Israel's founding. (Jaafar Ashtiyeh/AFP)
A Palestinian confronts IDF soldiers during a demonstration against Israeli settlements in the northern West Bank village of al-Sawiya on May 15, 2020, as Palestinians mark Nakba Day, or the 'catastrophe' of the displacement of Palestinians in the war during Israel's founding. (Jaafar Ashtiyeh/AFP)

Israeli security officials have warned that the Palestinian Authority’s economic troubles amid the coronavirus pandemic could lead to a violent uprising in the West Bank that destabilizes PA President Mahmoud Abbas’s rule, according to a newspaper report Friday.

The security officials also cited Prime Minister Benjamin Netanyahu’s vow to move forward with annexation in parts of the West Bank as a factor that could further fuel potential violence against both Israel and the PA, the Haaretz daily reported.

The warnings were made in recent meetings with political leaders, during which the officials cited intelligence and worrying economic data from the Palestinian Central Bureau of Statistics, such as an estimated 13.5 percent contraction of the economy this year, the report said.

In addition to the predicated virus-induced drop in growth, the sharp decline in the number of Palestinians working in Israel and West Bank settlements — both legally and illegally — since the start of the pandemic was seen as potentially causing further significant damage to the PA’s economy.

Palestinian workers enter Israel through the Mitar checkpoint in the southern West Bank on May 5, 2020. (Wisam Hashlamoun/Flash90)

The PA’s barring of Israeli citizens from entering areas under its control, where many Arab Israelis go to shop, as well as the collapse of the tourism industry and the difficultly of enlisting additional financial support from European and Arab donor states that are also suffering economically because of the virus, were cited in the report as further contributing to the PA’s growing financial problems.

Intelligence officials quoted by the newspaper noted protests in the West Bank in recent years have been mainly over economic issues and that there have not been major outbreaks of violence over hunger strikes by Palestinian security prisoners or in response to the moving of the US embassy to Jerusalem, as there were in the Hamas-ruled Gaza Strip.

With some 1.4 Palestinian children out of school in the West Bank and Gaza because of the virus, the security officials were said to be concerned they could become involved in the violence if it were to break out.

The reported concerns came as Israel earlier this week agreed to set aside NIS 800 million ($228 million) for potential loans to the Palestinian Authority to help offset the expected economic losses caused by the coronavirus crisis.

A cumulative maximum of NIS 800 million has been set for the entire period. After the pandemic’s economic effects end and the PA recovers its revenue stream, Israel will deduct the fronted funds from future tax transfers.

Palestinians shop while wearing protective masks amid the ongoing coronavirus pandemic in the West Bank city of Ramallah, on May 7, 2020. (Abbas Momani/AFP)Under interim peace agreements, Israel collects taxes on behalf of the Palestinian Authority on imports and exports, and transfers the funds to the Palestinians each month. These transfers cover a sizable chunk of the Palestinian government’s budget.

Over the last two years, Israel has deducted funds from the tax revenues it collects, per the amount that the PA pays to Palestinians security prisoners and their families. PA Prime Minister Mohammad Shtayyeh said during a Monday cabinet meeting that the total sum of last year’s withheld funds amounted to NIS 700 million ($200 million). At one point last year, the PA rejected the entirety of the tax transfers in protest of the Knesset legislation requiring this deduction, but it relented months later, upon facing further economic turmoil.

Late last week, several banks in the West Bank blocked access to accounts of Palestinians convicted of security-related offenses, days before an Israeli military decree entered into effect imposing sanctions on banks that financially reward terrorism.

The freeze led to anger on the Palestinian streets, with shots fired at a bank in the northern West Bank city of Jenin, a Molotov cocktail hurled at another branch in Jericho, and protests held outside one in Ramallah.

Palestinian Authority Prime Minister Mohammad Shtayyeh speaks to reporters during a press conference on April 13, 2020. (Wafa)

The move prompted the PA to form a committee to fight the Israeli measure, and Shtayyeh said last week that an agreement had been reached with banks to unfreeze the accounts.

Israel has long tried to clamp down on the hundreds of millions of dollars in stipends that are paid out to Palestinians convicted of security offenses or the families of slain attackers, which it says encourages terror. Ramallah has vowed to continue the payments, describing them as a form of social welfare and compensation for what it claims is an unfair military justice system that often robs Palestinians of due process.

Jacob Magid contributed to this report.

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