Saudi Arabia pledges to send funding for Palestinians

Jerusalem: Saudi Arabia has pledged to send financial aid to the struggling Palestinian Authority, reversing a decision made during the Trump administration to slash funding to the governing body that administers some areas in the Israeli-occupied West Bank.

The promise of a cash infusion won’t resolve the authority’s financial woes, but it reflects the improved relationship between Saudi Arabia and Palestinian leaders, which frayed during the Trump era. It is also a sign that the kingdom is strengthening its support for the establishment of a Palestinian state at a time when the Saudis appear to have shifted their tone on normalizing relations with Israel.

For months, the Biden administration and its allies have warned that the Palestinian Authority’s dire financial straits could foreshadow another escalation in the West Bank. Israeli forces have been stepping up raids targeting militants in which they ripped up roads and wrecked shops and homes in the territory.

The Saudi Foreign Ministry announced Sunday night that it would send a monthly aid package to the country’s “brothers in Palestine” to alleviate the “humanitarian situation in the Gaza Strip and its surrounding areas,” without specifying the amount or intended recipients. The commitment was made during a recent visit by the president of the Palestinian Authority, Mahmoud Abbas, to Saudi Arabia, according to one of his aides.

“Prince Mohammed affirmed to the president, Abu Mazen, the kingdom of Saudi Arabia’s support for the Palestinian people politically and materially,” said Mahmoud al-Habbash, a senior adviser to Abbas. Al-Habbash was referring to the Saudi crown prince, Mohammed bin Salman, and Abbas, using his nickname.

Saudi Arabia has agreed to deliver $60 million to the Palestinian Authority in six installments, with the first payment expected in the coming days, according to a senior Palestinian Authority official.

The funds will directly support the authority’s budget, said the senior official, who spoke on condition of anonymity to discuss sensitive information.

Four other Palestinian officials and four diplomats, who spoke on condition of anonymity because they weren’t authorized to communicate with the news media, confirmed Saudi Arabia has committed to send tens of millions of dollars to the authority.

With an economic crisis engulfing the West Bank since Hamas-led attacks on Oct. 7, the Palestinian Authority has struggled to cobble together funds to pay its civil servants and security forces, who constitute much of the territory’s labor force.

Israel has frequently refused to transfer tax revenues it collects on behalf of the Palestinian Authority. International aid has also dwindled for the authority, which is viewed by its allies and much of the Palestinian public as both corrupt and ineffectual.

The economic hardship has been compounded by the Israeli authorities’ blocking of tens of thousands of Palestinian laborers from entering its territory since the Oct. 7 attacks. Those laborers had brought billions of dollars annually into the West Bank’s economy.

Experts on the Persian Gulf said that Saudi Arabia’s renewed financial support for the authority was an attempt to stave off its implosion, not an endorsement of its leadership. The deliberations over sending the aid preceded the recent escalation between Israel and Hezbollah by at least several weeks.

“For Saudi Arabia, a two-state solution is essential,” said Hussein Ibish, a senior resident scholar at the Arab Gulf States Institute in Washington. “They’re not saying the Palestinian Authority is a great institution, but they are saying it must not collapse in order to preserve the possibility of establishing a Palestinian state.”

At a meeting on the sidelines of the annual U.N. General Assembly on Thursday, Prince Faisal bin Farhan, the Saudi foreign minister, announced the establishment of an international coalition to push for the two-state solution.

“Implementing the two-state solution is the best solution to break the cycle of conflict and suffering and enforce a new reality in which the entire region, including Israel, enjoys security and coexistence,” Prince Faisal said.

This month, Crown Prince Mohammed said Saudi Arabia would not establish diplomatic relations with Israel before the “establishment of a Palestinian state,” an apparent hardening of his position on an issue that could reshape the diplomatic map of the Middle East.

For decades, the leaders of Saudi Arabia, like those of most other Arab countries, refused to recognize Israel without the creation of a state for the Palestinians. But after 2020, when four Arab states established formal ties with Israel in agreements brokered by former President Donald Trump, Crown Prince Mohammed became the first Saudi leader to talk openly about the possibility of Saudi Arabia’s doing the same.

The Biden administration worked to broker the agreement as part of a grand bargain among the United States, Israel and Saudi Arabia. But after Oct. 7, those talks slowly ground to a halt, as the war between Israel and Hamas in Gaza continued without an end in sight.