Support for financing to the Palestinian Authority

State buildingWhy is support for financing to the Palestinian Authority important? 

Due to protracted periods of economic and political instability over the last decade, the Palestinian Authority (PA) continues to rely on external donor assistance to fund a large share of its annual budget. The PA also relies on the transfer of clearance revenues by the Israeli Government for a significant portion of its internal domestic revenues. These constitute the two major sources of funding, aside from borrowing, for the annual expenditures of the Palestinian Authority.

Support for financing to the PA is important because both the volume and flow of external donor assistance and the volume and consistency of transfer revenues from the Israeli authorities are vulnerable to political uncertainties. Greater political progress towards establishing a viable Palestinian state living side by side with Israel in peace and security will help reduce the PA’s dependence on both sources of funding.

How does the OQR support Financing to the Palestinian Authority?

The OQR supports financing to the Palestinian Authority by:

  • Mobilizing international and regional donor assistance, particularly direct budget support
  • Working closely with the Israeli Government to enhance Palestinian clearance revenues and to ensure their predictable transfer to the Palestinian Authority
  • Participating in key donor meetings related to the Palestinian Authority, particularly the Ad-Hoc Liaison Committee meetings chaired by the Norwegian Government twice a year and the Paris Donor Conference framework supported by the Government of France. 

Key achievements in support of financing to the Palestinian Authority

  • The Quartet Representative co-chaired the ‘International Donors’ Conference for the Palestinian State’ in Paris, which secured USD 7 billion in pledges for the Palestinian Reform and Development Plan (2008-2011).
  • The Quartet Representative helped mobilize direct budget support for the Palestinian Authority during the period 2008-2012 from major donors, particularly from the countries of the Gulf Cooperation Council. These efforts were exerted bilaterally and also in multi-lateral fora organized by the Norwegian and French Governments.
  • The Quartet Representative helped reinstate the monthly transfer of Palestinian clearance revenues in October-November 2011 following a decision by the Israeli Ministry of Finance to temporarily withhold monthly transfers.