Norway warns PA on the verge of collapse as Israel seeks to sanction it

Norway warned that the Palestinian Authority was on the verge of financial collapse as Israel’s security cabinet sought to level additional economic sanctions against it.

“The situation is extremely dire. The Palestinian Authority, with whom we work closely, are warning us that they might be collapsing this summer,” Norwegian Foreign Minister Barth Eide told Reuters.

“If it collapses, you could end up having another Gaza, which would be terrible for everybody, including the people of Israel,” he added.

Norway chairs the international donor group to the Palestinians and is a backer of the Palestinian Authority. Eide spoke out as United Nations Relief and Works Agency Commissioner-General Philippe Lazzarini visited Oslo.

Norway pledged an additional $10 million to UNRWA, the major provider of humanitarian services to the PA. Israel has urged countries not to support the organization, which it has accused of hiring employees with connections to Hamas and whose facilities have been used by the terror group. Israel has also charged that 12 UNRWA employees were involved in the Hamas-led invasion of Israel on October 7.

The funds for UNRWA, however, are transferred directly to UNRWA and are not designated for the Palestinian Authority, whose economy is suffering both due to the Gaza war and the financial penalties Israel has already leveled against it to offset its monthly payments to terrorists jailed by Israel.

Secret cabinet continues pressure

Israel’s security cabinet is expected to level further monetary sanctions against the PA for its support of terror and its initiatives against Israel on the international stage, including at the International Criminal Court in The Hague. It is also weighing authorizing four new settlements, one for each of the four European countries that unilaterally recognized Palestinian statehood in the last two months. Those countries are Spain, Norway, Ireland, and Slovenia.

“This is a clear message that we are sending to the countries that cooperate with the plans to eliminate Israel,” Finance Minister Bezalel Smotrich, who is also a minister in the Defense Ministry, said on Monday.

“Every country that cooperates with anti-Israeli activity and recognizes the Palestinian Authority as a country will know that it helps the Zionist enterprise and the strengthening of Jewish settlement in the country,” he said.

Smotrich said they had submitted a proposal on economic sanctions and settlement authorization to the cabinet and expected it would be approved.“The decision, which was brought in coordination with the prime minister, comes against the background of the Palestinian Authority’s attempt to gain support in the world to act against the State of Israel in legal arenas and to bring about the recognition of a Palestinian state,” he said.

“For technical reasons, the proposal did not come up for a vote yesterday, and I expect the prime minister, as agreed, to advance the proposals this week,” Smotrich stated.

The Prime Minister’s Office said late Sunday after the security meeting that “the defense minister and the attorney-general requested additional time to comment on several of the proposed clauses. The prime minister instructed that all of the proposals be submitted to a vote at the next security cabinet meeting.”

Reuters contributed to this report.