The money that Israel had intended to transfer to the Palestinian Authority after the war will instead go to pay the PA’s debts to Israel.
Israel has recovered funds that will pay for a decade-old $1.1 billion Palestinian Authority electricity debt by diverting money from the Norwegian Fund where money for the PA has been deposited since the beginning of the war, Israel HaYom reports.
Finance Minister Bezalel Smotrich told the Diplomatic-Security Cabinet Sunday about the process of collecting on the decade-old debt.
The Finance Ministry issued an order to the Norwegian Fund, into which Israel had been paying 275 million shekels monthly deducted from PA funds.
The money from the Norwegian Fund will pay for outstanding debts the PA has owed to Israel for over 10 years.
Half of the funds will be paid to companies that provided fuel to the PA, and the other half will go to Israel’s electric company.
Last spring, when Norway announced that it recognized a Palestinian state, Smotrich stopped sending money to the Norwegian Fund and diverted the money to a new account.
The money that Israel had intended to transfer to the Palestinian Authority after the war will instead go to pay the PA’s debts to Israel.
The process, which is being carried out in coordination with the U.S., is succeeding in securing the debt payment in full without
reducing interest.
Last May, Smotrich refused to extend a waiver to allow Israel’s banks to work with Palestinian banks, citing their close association with terror groups.
Smotrich stated he had no intention to extend the waiver to Palestinian banks, saying that “The PA’s financial system is up to its neck in terror,” and wrote on X, “They back and fund terror.”
The Norwegian Fund was created as a way to transfer money between Israel and the Palestinian Authority without forcing Israel to work directly with Palestinian banks.
However, when Norway declared a Palestinian State unilaterally, Smotrich refused to transfer the funds.
Smotrich wrote, “There’s urgency for an immediate response that will impose a significant cost on the Palestinian Authority for its actions and deter it and other countries,” Smotrich concluded.
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