The Palestinian Authority will seek a loan from the Arab countries



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JERUSALEM (Reuters) – President Mahmoud Abbas will seek help from Arab countries at a meeting of foreign ministers in Cairo to help the Palestinian Authority deal with its financial crisis, a senior Palestinian official told Reuters on Saturday.

"The loan request and the call to activate the Arab security net are in the context of attempts to overcome the financial crisis and not succumb to Israeli blackmail," said the official, who asked not to be named.

In the past two months, the Palestinian Authority has refused to receive Israel's tax revenues from goods entering the Palestinian market for a three percent commission, after deducting part of the money the Authority pays to families of martyrs and held in their prisons.

The Palestinian Authority relies on fiscal resources raised by Israel for Palestinian products, known as "compensation", in addition to local taxes and aid from Arab countries and donors in paying their financial obligations.

Over the past two months, the Palestinian Authority has been able to pay half the salaries of its civilian and military officials.

"As the month of Ramadan nears, next month a larger proportion of the salaries of officials must be paid so that they can fulfill their obligations to their families," the official said.

There are no details available on the resources in which half of the salaries were paid to government officials. The official page of the Ministry of Finance states that "because of the Emergency Law and legal dependencies with the Israeli side, financial reports have been temporarily suspended."

According to a World Bank report published on Wednesday, the release revenue Israel collects for Palestinians and transferred monthly to the Palestinian Authority is equivalent to 65% of total PA revenue.

"If this crisis is not resolved, the financing gap will increase from $ 400 million in 2018 to over $ 1 billion in 2019," the report said.

The Palestinian government said at its first meeting led by Mohammad Echtia last week that it convened a meeting of donor countries on the 30th of this month to discuss the financial crisis experienced by the Palestinian Authority.

The official Palestinian news agency said Abbas arrived in Cairo on Saturday to attend the Arab League Council meeting at the level of Arab foreign ministers on Sunday after Palestine's invitation to meet in an emergency.

The agency quoted Majbas al-Khalidi, Abbas's diplomatic adviser, saying that among the issues to be discussed at the meeting was "to activate the Arab financial security network to support the Palestinian budget, especially in the light of Israel's detention for about two months ".

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