US has ordered banks not to send money to PA, official says

Fatah’s Hussein al-Sheikh says American financial pressure aims to bring Palestinians to their knees, force them to accept Trump peace plan

Palestinian Authority President Mahmoud Abbas, left, attends a Christmas midnight mass at Saint Catherine's Church in the Church of the Nativity, traditionally recognized by Christians to be the birthplace of Jesus, in the West Bank city of Bethlehem on December 25, 2018. (AP Photo/Nasser Nasser, Pool)
Palestinian Authority President Mahmoud Abbas, left, attends a Christmas midnight mass at Saint Catherine's Church in the Church of the Nativity, traditionally recognized by Christians to be the birthplace of Jesus, in the West Bank city of Bethlehem on December 25, 2018. (AP Photo/Nasser Nasser, Pool)

A top Fatah official said in an Arabic-language interview published Sunday that the US has asked international banks to squeeze the Palestinian Authority financially in a bid to pressure the Palestinian leaders to accept the Trump administration’s peace plan.

“Major international financial institutions and parties have begun to accede to an American request to impose a tight financial siege on the Authority,” Hussein al-Sheikh told AFP.

“Washington has asked for financial aid given to the authority to be stopped, and it has also issued a circular to banks not to receive transfers for the authority’s accounts.”

The claim came on the same day that Prime Minister Benjamin Netanyahu vowed to begin deducting PA payments to convicted terrorists and their families from tax transfers Israel hands the PA each month, and after massive cuts in US aid to the Palestinian in recent months.

According to al-Sheikh, “the sanctions began with preventing the transfer of an Iraqi grant worth $10 million, which was handed over to the Arab League recently. The League has not been able to transfer it because all banks have refused to accept it for transfer to the Authority’s finance ministry or the national fund.”

File: Then-coordinator of government activities in the territories (COGAT) Maj. Gen. Yoav Mordechai, left, and the Palestinian Authority’s Civil Affairs Minister Hussein al-Sheikh sign an agreement to revitalize the Israeli-Palestinian Joint Water Committee, January 15, 2017. (Courtesy COGAT)

Al-Sheikh added that “the American decision is in line with an Israeli decision” to cut the tax transfers, which represent more than 50 percent of the Palestinian treasury’s imports and constitute about 70% of the current expenses of the Authority and the salaries of its employees.

He added: “The American and Israeli decisions come as part of an attempt to bring the leadership to its knees and force it to accept [US President Donald Trump’s] ‘deal of the century,’ first by allowing for its announcement and second to pave the way to ‘Arabize’ it and begin the process of Arab normalization with Israel without [Israel giving] anything in return” to the Palestinians.

He accused the US and Israel of pushing PA President Mahmoud Abbas to what he described as “extreme decisions.”

Netanyahu told cabinet ministers on Sunday that he would, in a week’s time, begin cutting funds to the PA over its payments to terrorists and their families.

“By the end of the week, the staff work required for implementing the law on deducting terrorists’ salaries will be completed,” the prime minister said at the weekly cabinet meeting in Jerusalem, referring to a law that was passed by the Knesset in July and formally went into effect on January 1. It grants the government the power to withhold Palestinian tax funds from the PA equal to the amount spent by the PA in payments to incarcerated security prisoners and the families of terrorists killed while attacking Israelis.

Palestinian Authority President Mahmoud Abbas, right, meets US President Donald Trump In the West Bank city of Bethlehem on May 23, 2017. (Fadi Arouri, Xinhua Pool via AP)

“Next Sunday I will convene the security cabinet and we will approve the decision needed to withhold the funds. The funds will be deducted. No one should doubt that. And next week,” he vowed.

The comments come amid pressure on Netanyahu to act after the arrest of a Palestinian man, Arafat Irfayia, 29, on Friday for the brutal murder of 19-year-old Ori Ansbacher in a southern Jerusalem wood a day earlier. The case has sparked outrage across the country, and the Shin Bet security service has indicated Irfayia had a nationalistic motive for the attack.

The government has refused to implement the power given to it by the law to freeze the fund transfers amid security officials’ fears it could destabilize the PA and lead to violence. But politicians have faced public pressure to crack down on the PA’s payments, which are viewed as incentivizing terror attacks.

A PA law legislated in 2004 says any Palestinian prisoner and his or her family are entitled to a variety of payments. The law defines a prisoner as “anyone who is sitting in the occupation’s prisons for participating in the struggle against the occupation” and calls such a person “part and parcel of the Palestinian Arab community’s fabric.”

Palestinian officials have argued payments to security prisoners seek to mitigate what they call an unfair Israeli military court system.

Prime Minister Benjamin Netanyahu leads the weekly cabinet meeting at the Prime Minister’s Office in Jerusalem on January 6, 2019. (Alex Kolomoisky/Yedioth Ahronoth/Pool)

Last March, Trump signed into law legislation that requires the American government to cut some aid to the Palestinians until they end payments to terrorists and slain attackers. Since Trump signed the legislation, his administration has cut hundreds of millions of dollars in aid to the Palestinians.

Abbas has said the PA will continue to pay stipends to the families of Palestinian security prisoners and “martyrs” even if it has to spend its last penny to do so.

“We will not accept a cut or cancellation of salaries to the families of martyrs and prisoners, as some are trying to bring about,” he told representatives of a Palestinian prisoners advocacy group in July. “Even if we have only a penny left, we will give it to the martyrs, the prisoners and their families.”

Since shortly after Trump recognized Jerusalem as Israel’s capital in December 2017 and initiated the relocation of the US embassy in the Jewish state to the city, Abbas has called for an international conference in order to establish a multilateral mechanism for the peace process.

In this Thursday, June 21, 2018 photo, provided by Egypt’s state news agency, MENA, Egyptian President Abdel-Fattah el-Sissi, center, meets with President Donald Trump’s son-in-law and senior adviser Jared Kushner, second left, and Mideast envoy Jason Greenblatt on a regional tour to discuss a blueprint for an Israeli-Palestinian peace deal, in Cairo, Egypt. (MENA via AP)

He has also declared that the Palestinians would no longer work with an American-dominated peace process.

Meanwhile, White House senior adviser Jared Kushner and other administration officials are headed to the Middle East later this month to brief diplomats in at least five countries on the economic section of the expected US proposal for peace between Israelis and Palestinians.

Kushner, who is Trump’s son-in-law, will be joined by US Mideast envoy Jason Greenblatt, US envoy on Iran Brian Hook and other administration officials who have worked on the economic part of the plan.

Stops are confirmed in Oman, Bahrain, Saudi Arabia, United Arab Emirates and Qatar. Other stops could be added to the trip, according to a White House official.

The plan includes an economic development proposal for Palestinians that foresees major infrastructure and industrial work, particularly in Gaza. For the plan to succeed or even pass the starting gate, it will need at least initial buy-in from both Israel and the Palestinians as well as from the Gulf Arab states, which officials say will be asked to substantially bankroll the economic portion.

US officials have said the plan won’t be made public before Israel’s elections on April 9.

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