Palestinian Prime Minister Mohammed Ishtaye warned on Tuesday that the Palestinian Authority was facing a very sharp financial crisis that would prevent it from meeting its obligations.
He made the remarks at the start of an emergency AP cabinet meeting held in the West Bank city of Ramallah to discuss the months-long financial crisis.
Ishtaye discussed the current financial situation with cabinet members and the means available to meet its financial obligations by the end of 2021, according to an official statement issued after the meeting.
“The financial situation is the most difficult in so many years. “The financial aid we received was less than 10 percent of what we received in previous years,” Ishtaye told the cabinet.
He noted that “the Palestinian Authority has not received any financial assistance from Arab states for two years.”
Ishtaye, meanwhile, briefed the Palestinian Cabinet on his tour of last week in several European countries and his meeting with representatives of donor countries in the Norwegian capital Oslo.
“I urge countries that are friends with Palestine to put pressure on Israel to stop deducting Palestinian tax revenues and increase their donations,” he said.
Ishtaye explained to the cabinet that one of the main reasons for the financial crisis is the lack of international and Arab donations to the Palestinians. Another is the deduction of Israel from tax revenues.
Under an economic protocol reached between the Palestinians and Israel in 1994, the two agreed that the Israeli side would collect taxes from the Palestinian trade passing through the checkpoints it controls and return them to the AP treasury.
However, two years ago, Israel began to deduct from the tax revenue it pays the AP monthly.
Israel said the money it owed was paid by the Palestinian Authority to Palestinian families whose children were killed during attacks on Israel, or Palestinian prisoners in Israeli jails.
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