Israel should transfer Palestinian funds now

Norway reacts to Israel’s withholding of Palestinian tax revenues. “This is unacceptable,” said Norwegian Minister of Foreign Affairs Jonas Gahr Støre. “This money must be transferred immediately.”

The Israeli Government is withholding Palestinian VAT and customs duties that are administered by Israel and transferred on a regular basis according to an agreement with the Palestinians. This money is equivalent to around two-thirds of the payroll expenses for public employees in the Palestinian Authority (PA). The backdrop to Israel withholding these funds is the agreement on Palestinian reconciliation that was signed between Hamas and Fatah in Cairo last Wednesday.

“This money belongs to the Palestinians. Israel just administers these funds on behalf of the Palestinian Authority according to an agreement. Withholding these funds undermines President Abbas and other Palestinian political forces that are pursuing a peaceful solution,” said Mr Støre.

According to the World Bank, the PA now has the institutional capacity for it to function as an independent state. The International Monetary Fund announced at the meeting of the Ad Hoc Liaison Committee in Brussels in April this year that the PA’s financial management meets high international standards. The withholding of these revenues has already delayed the payment of salaries to Palestinian public employees.

“The Israeli decision is jeopardising the whole Palestinian state-building project. It is vital that Israel respects the agreements it has entered into with the Palestinians and transfers these funds immediately,” said Mr Støre.

Mr Støre relayed this message to Israeli Deputy Minister of Foreign Affairs Daniel Ayalon during his visit to Norway on 6 May.