President Mahmoud Abbas’s Palestinian Authority (PA) is in a dire situation. At home she has lost the confidence of the starving population. Out in the world, backers are breaking away and the broad stream of international financial aid has become a trickle. The Palestinians are as good as broke. But in all this hopelessness they suddenly get support from an unexpected source – from Israel. The government in office in Jerusalem since June seems to be following a new motto: With money, hostility ends.
This week the Palestinian donor countries, who are members of the “Ad Hoc Liaison Committee” (AHLC), will meet in Oslo. And Israel’s representative, Minister Issawi Frej from the left-wing Meretz party, who is responsible for regional cooperation, has traveled to Norway on a special mission: “Our message to the donor countries is to give more aid to the Palestinians,” he said in one Interview with the Times of Israel. “The neglect in recent years has created a financial crisis that threatens not only the Palestinian Authority but the entire region.”
Israel’s government is responding to an alarming report published by the World Bank last week. According to this, international financial aid for the PA has fallen by 85 percent since 2008, from $ 1.2 billion at the time to just $ 184 million for 2021. The West Bank is threatened with a budget deficit of $ 1.36 billion this year. Because of the lack of money, the autonomy authority could neither fight the Corona nor pay the salaries for the army of public servants. In short: the PA is on the verge of collapse.
This is also a terrible scenario for Israel. Despite all the differences, Abbas remains a guarantee that the security cooperation with the Palestinians in the West Bank works. Only last week, according to Israeli reports, the new head of the domestic intelligence agency, Shin Bet, Ronen Bar, had met the Palestinian president in secret in Ramallah. Strengthening Abbas also means keeping the far more radical Hamas away from taking power in the entire Palestinian Territory.
The eight-party coalition is incapable of acting in the conflict
Israel’s call to international donor countries for aid to Abbas is therefore anything but selfless. And beyond the short-term effect, she refers to a new concept of the government in Jerusalem in dealing with the Palestinians. The catchphrase is: The conflict is shrinking. In essence, it is about avoiding escalations by improving the living conditions of the Palestinians living under occupation.
This concept is also a consequence of the fact that the Israeli eight-party coalition is practically incapable of acting in matters of the Middle East conflict. A common line between the left, right and the Arab Raam party represented in the government is not in sight. Prime Minister Naftali Bennett, who comes from the right-wing settler camp, is an avowed opponent of a Palestinian state, which he consistently calls only a “terrorist state”. Foreign Minister Jair Lapid, Defense Minister Benny Gantz and the representatives of the Labor Party, Meretz and Raam, on the other hand, are considered supporters of a two-state solution.
The so-called shrinkage of the conflict appears as the lowest common denominator – and at the same time as an offer to Washington, where an advocate of the two-state solution has reigned since President Joe Biden took office. When Bennett made his inaugural visit to the White House in August, Biden did not admonish him to hold peace talks, but merely to “improve the lives of the Palestinians.”
Defense Minister Gantz, who issued a first set of measures after visiting Abbas, took concrete action. To help the PA out of the acute financial crisis, Israel granted a loan of around 140 million euros. In addition, 15,000 new work permits were issued to Palestinians in Israel.
Proponents of this concept argue that it will keep the door open for later peace negotiations. Critics point to the ongoing development of the settlement and see the relief at most as cosmetics for the cemented occupation. You really don’t get any closer to a solution to the eternal conflict. After all, it is not essentially about an economic conflict, but about a dispute over the country, heated up by religion, ideologies and a bloody history.