The Arab League reaffirmed on Sunday its pledge to establish a $100 million monthly fund for the embattled Palestinian Authority.
In a statement, the League said it had made the move to ease “financial burdens” facing the PA, which has limited self-rule in the occupied West Bank.
The announcement came only a day after the United States released part of its Peace to Prosperity plan for the Middle East and one day before the start of the related economic conference in Bahrain, both of which the cash-strapped Palestinian leadership has pledged to boycott as biased against them and their goal of an independent state.
Washington’s Peace to Prosperity workshop will be held on Tuesday and Wednesday in Manama and led by Jared Kushner, the son-in-law of US President Donald Trump.
Saudi Arabia, the UAE and Qatar will attend, against Palestinian protests, while Jordan and Egypt are sending only low-level delegates. Israeli officials were not invited, though some Israeli business leaders and media will attend, despite Israel and Bahrain having no formal diplomatic relationship.
The US is touting the conference as the first step in Mr Trump’s peace deal for Israelis and Palestinians.
Organisers have emphasised that politics will be off the table, but Palestinians and critics of the Trump team’s approach have countered that the political situation is part and parcel of fixing the flailing Palestinian economy.
The Arab League first pledged the monthly safety net in April, after Israel cut funding to the PA as part of a tax dispute.
Israel collects taxes on imports on behalf of the PA, which per the Paris Protocol it then transfers over as Israel controls all borders. But in February, Israel said it would withhold $138m (Dh507m) in protest at payments the PA makes to Palestinians jailed for attacking Israelis. The PA, in turn, said it would not accept any of the funding.
Ahmed Aboul Gheit, Secretary General of the Arab League, said the PA’s budget deficit had reached $700m this year, it was reported by Wafa, the official Palestinian news agency.
Palestinians have long criticised the western-backed PA for financial mismanagement. Established as part of the Oslo Peace Accords, the semi-autonomous body was supposed to be an interim government, but decades later remains as the two-state solution peace process has stalled.
Now Palestinians are waiting to see what will come out of Bahrain – and what Israel will do in the meantime.
On Sunday, Israeli Prime Minister Benjamin Netanyahu met US National Security Adviser John Bolton and toured the Jordan Valley in the occupied West Bank. The Jordan Valley is a strategically important area that Palestinians claim for their future state, and into which Israeli settlements, considered illegal under international law, have expanded.
Back in April, Mr Netanyahu pledged to annex part of the West Bank if re-elected. While his party did win the recent election, he failed to form a government and will run again in September, leaving his pledge in limbo.