Palestinian statehood push undermined US efforts to release Israeli-held funds, envoy says

U.S. Ambassador Mike Huckabee said on Wednesday that growing international momentum to recognize a Palestinian state directly led to the collapse of U.S. efforts to persuade Israel to release much-needed funds to the Palestinian Authority.Huckabee said he had been “shuttling back and forth” between the two sides, partly out of concern that worsening economic instability in the West Bank could spark violence, but that momentum towards recognition had hardened Israeli positions.The Palestinian Authority exercises limited civic rule in the Israeli-occupied West Bank.”I felt like we were making progress. We weren’t quite there yet, but we were talking, and there was progress, and there was understanding of the importance of getting it resolved,” Huckabee said in an interview with Reuters in Jerusalem.When asked whether the Palestinian funds that Israel had blocked from transferring would remain on hold indefinitely, Huckabee said that everything was “frozen in place”.The Palestinian foreign ministry and a spokesperson for Israeli Finance Minister Bezalel Smotrich did not immediately respond to a request for comment.According to the Palestinian Authority, Israel is withholding around $3 billion in revenues. Under a longstanding arrangement, Israel collects customs and import taxes on behalf of the Palestinian Authority.Those revenues make up a bulk of the Palestinian Authority’s budget, which also depends heavily on foreign aid, that pays salaries of police, teachers and other government employees.The Israeli government has frequently withheld funds owed to the Palestinian Authority, later releasing them partially or in full. As a result, the Palestinian Authority struggles to pay its employees, many of whom receive only partial salaries.Palestinian officials suspect that the withholding of funds is a deliberate attempt to stifle the economy. They warn it could backfire on Israel by pushing people towards militancy.Huckabee said that the amount being withheld was significant and that it was inflicting an extraordinary economic pain on Palestinians. However, he insisted that the Palestinian Authority bore some responsibility for encouraging recognition efforts.Reuters