Palestinian Authority Takes Major Step toward Cutting Ties with Israel

Palestinian Authority officials have confirmed that they will no longer accept taxes and tariffs that Israel collects on behalf of, and remits to, Ramallah for goods destined for the West Bank. As the funds account for more than half of the PA’s budget, the decision threatens to amplify an already dire economic situation in the West Bank. The officials noted that the move was part of PA President Mahmoud Abbas’s recent declaration that all agreements with Israel were null and void. This was precipitated by Jerusalem’s prospective annexation of PA-claimed territory in accordance with the Trump Administration’s Middle East peace plan. According to Israeli media, the PA rejected the remittance for May after the Israeli government attempted to condition its transfer on the renewal of security coordination between the sides. The coronavirus pandemic has caused a fiscal crisis in the West Bank, with the World Bank on Monday having predicted that the Palestinian economy could shrink by as much as 11% this year. It also estimated that the PA’s budgetary shortfall could grow by $1.5 billion in 2020.