Last updated: 19 March, 2013

Palestinians call for fiscal aid and warn against collapse

The Palestinian Authority has urged the world to step up financial aid and press Israel to allow economic development, over fears of “political collapse” due to Israeli fiscal strangulation.

“We call on the international community to… pressure the government of Israel to release our revenues and to provide the financial support required to maintain basic functions and services,” said a Palestinian Authority report seen by AFP on Monday.

“The recent confiscation of Palestinian-owned revenues by Israel comes on top of an already severe fiscal crisis that was caused by a large shortfall of external support,” it added.

The report was released ahead of a Tuesday meeting in Brussels of international donors, and nearly four months after the Palestinians won upgraded UN ranking as a non-member observer state.

On January 30, Israel said it had released $100 million of the tariffs and tax monies it collects on behalf of the Palestinian Authority, which were frozen last year as punishment for the UN bid.

The report urged “international partners, particularly those within the Arab region, to consider the implications of the current fiscal crisis and a possible slide into institutional and political collapse” for the Palestinian Authority.

“A prosperous, sovereign and independent Palestine requires international support to allow…. development in Area C,” the 60 percent of the West Bank that is under Israeli control, and Israeli-annexed east Jerusalem, the report added.

It underlined the importance of Area C as “the backbone of the Palestinian economy,” saying agricultural production therein could yield an additional $2.25 billion (1.7 billion euros) of revenue per year.

It demanded immediate Palestinian access to all roads in Area C and the removal of all checkpoints in the West Bank to allow freedom of movement.

In a separate report to donors also released on Monday, the office of UN Special Coordinator for the Middle East Peace Process Robert Serry said Israel must ease financial restrictions on the Palestinian Authority.

“Israel should refrain from withholding and/or delaying the transfer of clearance revenue owed to the PA as well as from using it to offset Palestinian utility bills,” he said.

It also warned that “Palestinian state-building achievement was at increased risk and the PA was facing ever greater political and financial pressure,” urging Israel to “ease Palestinian access to Area C.”