On May 20th the BBC News website reported that:
“Palestinian Authority President Mahmud Abbas has said he is ending “all agreements” with Israel and the United States in response to Israeli plans to annex parts of the occupied West Bank.”
Three and a half weeks on, BBC audiences have not seen any reporting on how that declaration is affecting the lives of ordinary Palestinians.
“The Palestinian Authority on Wednesday said it will no longer accept tax revenue transfers from Israel as it pushes ahead with efforts to void understandings and end coordination with Israel.
“We assert that we refused and continue to refuse the delivery of the tax revenues in adherence to the decision of the Palestinian leadership that we are absolved of all understandings and agreements with Israel,” Palestinian Civil Affairs Commission director Hussein al-Sheikh, who is also a member of the Fatah Central Committee, wrote on Twitter.
PA government spokesperson Ibrahim Milhim confirmed al-Sheikh’s statement, saying that the PA had rejected its “regular tax transfer” from Israel for May 2020.”
As the Times of Israel reports, those decisions have brought the PA to the brink of yet another financial crisis.
“The World Bank announced last Monday that the Palestinian economy was projected to contract by as much as 11% as a result of the global economic recession sparked by the coronavirus pandemic. […]
In the last week, the PA’s fiscal crisis has only deepened. The World Bank’s projections were made before Ramallah announced that it would no longer accept the $170 million in import and export taxes which Israel transfers to the PA on a monthly basis. Senior PA officials said the move was part of efforts to void agreements and end coordination with Israel over its plans to annex parts of the West Bank.
As part of ending coordination with Israel, the PA also refused a loan of up to NIS 800 million ($230.2 million) authorized by the Israeli government, which would have been taken out of future tax revenue transfers, to cover its losses.
Tax revenues collected by Israel on behalf of the Palestinians have always constituted a significant part of the PA’s budget: In 2019 they amounted to about 60% of overall revenue.”
The practical effects of that PA decision are already evident:
“On Tuesday, the Ramallah Finance Ministry announced that it would not pay civil servants their May wages. Public sector salaries account for 15%-20% percent of Palestinian GDP, according to the World Bank. In a normal month, the PA spends NIS 850 million ($244.5 million) on civil servants, pensioners and stipends to the families of Palestinians convicted by Israel of terrorism or killed during attacks on Israelis.”
Some 200,000 of those civil servants are located in Palestinian Authority controlled areas and around 60,000 are located in the Gaza Strip. The Jerusalem Post reported that a Palastinian official was also quoted as saying that the PA would “slash the $105 million it sends to the Hamas-controlled Gaza Strip each month in salaries and to cover utility fees and medical expenses”.
Notably, the BBC’s Jerusalem and Ramallah-based correspondents have to date not found those or any other aspects of the Palestinian Authority’s decision to unilaterally end agreements it signed with Israel worthy of reporting to BBC audiences.