Israeli Prime Minister Naftali Bennett’s government has been in talks with the Palestinian Authority to send hundreds of millions of shekels to Ramallah amid the latter’s growing budget crisis, sources in Jerusalem and Ramallah told The Times of Israel.
A tentative agreement for an Israeli financial package worth NIS 800 million ($247 million) to the PA has been formulated, an Israeli official said on Friday, with another official familiar with the matter describing the deal as “practically done.”
There had been plans to announce the package before Bennett’s trip this week to Washington, where the Biden administration is looking for Israel to act on rhetoric in favor of “deescalating the conflict” with the Palestinians and to advance measures that strengthen the PA. However, the financial package was not finalized in time for that.
Senior PA official Ahmad Majdalani confirmed that talks on financial support were ongoing between the two sides. He said the funds would not be a loan, rather an advance on tax revenues Israel collects on Ramallah’s behalf.
“There’s discussion around an advance on what we are owed, not a loan,” Majdalani said.
Both the Israeli and Palestinian Authority finance ministries could not immediately be reached for comment.
The Palestinian Authority has found itself in a difficult position in recent months. Hamas, its key rival, has been growing in popularity since the terror group’s 11-day battle with Israel in May.
The death of Palestinian Authority critic Nizar Banat in late June while in the custody of PA security forces increased the domestic turmoil. Following Banat’s death, rare protests erupted calling for PA President Mahmoud Abbas’s resignation. Some of the rallies were violently suppressed by PA forces, who beat demonstrators and arrested dozens more, drawing international criticism.
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