Palestinian Finance Minister: 'Earthly solutions have ended' and financial crisis threatens collapse of the Authority

Palestinian Finance Minister, Istifan Salameh, issued unprecedented warnings about the financial reality experienced by the Palestinian National Authority, describing the current stage as having surpassed transient crises to become an existential threat targeting the national project. The minister affirmed in a press briefing that technical and practical options have been completely exhausted, using the phrase 'earthly solutions have ended' to denote the depth of the predicament caused by the occupation's policies of withholding clearance funds.

Salameh explained that the Authority's continued provision of services until now represents a 'miracle' by all standards, noting that any other country would have collapsed if it faced the same financial circumstances. He indicated that the government has become dependent on meager local revenues that do not cover the minimum basic needs, which puts the stability of public institutions at stake in the absence of any horizon for a political or financial solution in the near future.

The minister revealed shocking figures related to public debt, which has jumped to $15.4 billion, explaining that the clearance funds withheld by Israel represent the backbone of revenues, accounting for up to 70%. He pointed out that what was actually received last year did not exceed 1.9 billion shekels out of total entitlements exceeding 10 billion shekels, creating a huge funding gap.

Regarding operational expenses, Salameh mentioned that the monthly local revenues collected by the Authority amount to about 400 million shekels, but the shocking fact is that about 300 million shekels of this goes directly to service the public debt to banks and lending institutions. This means that the remaining amount in the treasury is not enough to cover a small portion of salaries or operational expenses for hospitals, schools, and other vital facilities.

The minister announced harsh austerity measures, including halting all development projects for 2026 and focusing absolutely on essential expenditures that ensure the survival of institutions. He stressed that the battle over clearance funds is a political battle par excellence, as the occupation authorities use money as a weapon to destroy the Palestinian political entity and undermine its ability to endure.

Salameh touched upon the legal pressures in Israeli courts, where the Authority faces 475 lawsuits claiming 'compensation' totaling 65 billion shekels. He considered these cases to represent another front in the financial targeting aimed at bankrupting the Authority and ending it legally and financially, which requires urgent international action to stop this blackmail.

For their part, Palestinian economic experts and activists reacted bitterly to these statements. Expert Mohammed Khbeisa considered that the announced figures reflect the reality of the government's lack of options. Khbeisa pointed out that the allocation of most local revenues to debt repayment puts the Authority in a vicious cycle, especially with the continued withholding of clearance funds for the tenth consecutive month without signs of a breakthrough.

In a related context, economic expert Mu'ayyad Afaneh warned that the government might not be able to maintain the current salary disbursement rate of 60% if the current data persists. Afaneh affirmed that the technical margins through which the Ministry of Finance maneuvered have vanished, which may force it to further reduce the percentage in the coming months, exacerbating the living crisis for citizens.

On the media front, Mu'ammar Arabi called for a change in the rules of engagement with the occupation, considering that the approach of settlement and negotiations has only led the Authority to further weakness and dependence on the occupation's blackmail. Arabi demanded a re-evaluation of the Palestinian cause as a national liberation movement, emphasizing that the solution lies not in technical solutions but in a national leadership that confronts colonialism in all its forms.

Journalists and activists, during and after the conference, proposed a series of internal austerity measures to confront the crisis, including reducing the number of Palestinian embassies abroad and merging non-sovereign ministries. The proposals also included halting new appointments, canceling unnecessary expenses and allowances for officials, and stopping foreign trips that drain the treasury without real benefit on the ground.

Ma'rouf Al-Rifa'i, advisor to the Jerusalem Governorate, called for the necessity of withdrawing government vehicles from civilian and military positions and limiting movement to the absolute minimum necessary. Al-Rifa'i urged the adoption of fully electronic correspondence to eliminate stationery and hospitality expenses, emphasizing that the people expect officials to set an example in austerity during this critical stage.

For his part, lawyer Salahuddin Mousa criticized what he described as a failure in public financial management over the years, considering that the insistence on a massive bureaucratic structure for the Authority is no longer compatible with the battle for existence. Mousa called on the Palestinian President to declare a state of emergency and temporarily nationalize public and private facilities, in addition to issuing a decision to halt debt and interest payments to banks for at least one year.

Observers believed that Minister Salameh's statements might be a prelude to difficult decisions to come, as Professor Misbah Al-Haj Mohammed indicated that 'the doors and windows' have completely closed on Palestinian funding. He considered that the cessation of external support from entities such as Saudi Arabia and Spain, coinciding with the piracy of clearance funds, puts Palestinians before choices where the sweetest is bitter.

In conclusion, the question remains in the Palestinian street about the Authority's ability to withstand these immense financial pressures without a social or political explosion. While some believe that collapse is imminent, others think that the occupation will maintain the Authority's survival in the 'intensive care unit' to serve its security interests, awaiting a political miracle to rearrange the cards.

Earthly solutions have ended... The normal situation is the financial collapse of the Authority, and the continuation of public services represents a miracle reflecting the solidarity of all parties.