Warner, Kaine & Colleagues Sound the Alarm About Economic Deterioration in the West Bank

WASHINGTON, D.C. – U.S. Senator Mark R. Warner (D-VA), Chairman of the Senate Select Committee on Intelligence, led Senators Mark Kelly (D-AZ), Angus King (I-ME), Tim Kaine (D-VA), Martin Heinrich (D-NM), John Hickenlooper (D-CO), Cory Booker (D-NJ), Jeanne Shaheen (D-NH), Michael Bennet (D-CO), Tom Carper (D-DE) Jack Reed (D-RI), and Ron Wyden (D-OR) in sounding the alarm about the economic deterioration in the West Bank and the troubling rise in violent acts perpetrated by extremist Israeli settlers. In a letter to President Biden, the lawmakers stressed the need for Israel to take steps to address the growing instability in the West Bank, including by ensuring that the Palestinian Security Forces are able to ward off violence against innocent Palestinian civilians and prevent further destabilization, which could open an additional front to the conflict.

This letter follows a decision by Israel to withhold a significant portion of tax revenues that its government collects on behalf of the Palestinian Authority (PA). These revenues – meant to be collected and transferred based on longstanding agreement – are critical for the PA’s civil administration and security purposes.

“A range of factors since October 7 – including a loss of wages for the thousands of Palestinians in the West Bank whose work permits Israel revoked – have contributed to an economic situation that has shuttered thousands of West Bank businesses and reduced the Palestinian Authority’s (PA) revenues by roughly 80 percent. Those revenues support a range of critical functions for the PA, including paying public-worker salaries as well as the salaries of members of the Palestinian Security Forces, whose local law enforcement and security efforts are critical to maintaining stability in the West Bank,” wrote the senators. “A significant source of the PA’s revenue derives from Palestinian import tax revenues, which according to long-standing agreement, the Israeli government collects on behalf of, and then transfers to, the PA. We are concerned that the Israeli government’s decision following the October 7 attacks to withhold a significant portion of these revenues, and the PA’s decision to not accept the reduced sum, is dramatically exacerbating the economic volatility in the West Bank.”

“In addition to harming the well-being of Palestinians, the current lack of revenue transfers directly threatens the economic standing of the security services in the West Bank. Absent these funds, salaries for the more than 30,000 members of the Palestinian Security Forces cannot be paid in full. The possibility of these forces declining to serve, absent pay – and the possibility of militant groups attempting to step in and financially coerce these services – represents a significant security threat, risking the opening of a new front to this conflict to the detriment of Israeli and regional security,” they continued. “We urge you and senior members of your Administration to continue to prioritize the resumption of these transfers in any conversations with the Israeli government as well as Palestinian Authority officials. A commitment by Israel to immediately transfer the full allotment of Palestinian Authority revenues is vital to staving off a significant rise in instability, and would represent a crucial step by Israel towards deescalating tensions in the West Bank.”

A copy of the letter is available here and below:

Dear President Biden,

We write with ongoing concern about the alarming conditions in the West Bank. As Israel continues to address the lethal and ongoing threat posed by Hamas following the terrorist group’s horrific October 7 attacks, Israel must take steps to address growing instability in the West Bank. Israeli settlers’ violence and deteriorating economic conditions are compromising the lives of innocent Palestinian civilians and threaten further destabilization. We are concerned that these conditions risk opening an additional front to the conflict, to the significant detriment of Israeli and regional security.

Members of Congress have joined you in voicing concerns about the alarming rise in violent acts perpetrated by extremist Israeli settlers in the West Bank over the past two months. We believe the Israeli government must address these attacks against Palestinians, and we applaud your Administration’s recent actions – including visa bans – targeting those carrying out these attacks.

We are also concerned about the conflict’s economic impact in the West Bank, and the risk it poses for further violence. A range of factors since October 7 – including a loss of wages for the thousands of Palestinians in the West Bank whose work permits Israel revoked – have contributed to an economic situation that has shuttered thousands of West Bank businesses and reduced the Palestinian Authority’s (PA) revenues by roughly 80 percent. Those revenues support a range of critical functions for the PA, including paying public-worker salaries as well as the salaries of members of the Palestinian Security Forces, whose local law enforcement and security efforts are critical to maintaining stability in the West Bank.

A significant source of the PA’s revenue derives from Palestinian import tax revenues, which according to long-standing agreement, the Israeli government collects on behalf of, and then transfers to, the PA. We are concerned that the Israeli government’s decision following the October 7 attacks to withhold a significant portion of these revenues, and the PA’s decision to not accept the reduced sum, is dramatically exacerbating the economic volatility in the West Bank.

In addition to harming the well-being of Palestinians, the current lack of revenue transfers directly threatens the economic standing of the security services in the West Bank. Absent these funds, salaries for the more than 30,000 members of the Palestinian Security Forces cannot be paid in full. The possibility of these forces declining to serve, absent pay – and the possibility of militant groups attempting to step in and financially coerce these services – represents a significant security threat, risking the opening of a new front to this conflict to the detriment of Israeli and regional security.

We acknowledge the need for a number of reforms related to PA governance, including those that would address corruption concerns, as well as its martyr and prisoner payment system. These reforms remain important, alongside supporting near-term stability and security.

In recent testimony before the Senate Committee on Appropriations, Secretary of State Blinken testified that the PA is “vastly under resourced,” and that import tax revenues have indeed been a topic of negotiation with the Israeli government. We urge you and senior members of your Administration to continue to prioritize the resumption of these transfers in any conversations with the Israeli government as well as Palestinian Authority officials. A commitment by Israel to immediately transfer the full allotment of Palestinian Authority revenues is vital to staving off a significant rise in instability, and would represent a crucial step by Israel towards deescalating tensions in the West Bank.

###