It is no secret that the Palestinian Authority's (PA) financial crisis is mounting with declining foreign support. This has prompted Mohammad Shtayyeh, a member of Fatah's Central Committee and former minister of public works and housing, to confirm Feb. 13 that donors' funding is decreasing and the PA's financial crisis is ongoing.

Shadi Othman, the communication and information officer at the European Commission in Jerusalem, said Feb. 3 that a new financial support policy for 2017 was adopted by the European Union, and that the EU contribution of 30 million euros ($32 million) that had gone to pay the salaries of PA civil servants in the Gaza Strip will be used to support families in need, provide job opportunities and fund development and infrastructure projects.

On Feb. 7, the PA government replied in a statement that the new EU approach will further increase the budget deficit. It said that last year, Prime Minister Rami Hamdallah launched efforts to prevent the EU decision, but to no avail. According to the statement, this means that the PA’s financial burden will grow and the $39 million monthly budget deficit will increase.

A European diplomat in the Palestinian territories, who spoke to Al-Monitor on condition of anonymity, said, “The new EU approach came to implement the recommendations of the European Monitoring Committee’s report of 2013, which rejected that civil servants who do not punch the clock be paid their paychecks by the EU, in the absence of any valid justification for the European taxpayers explaining why their money is channeled to these civil servants. Thus, the EU did not cut the funding, but rechanneled these funds to another sector, namely the families in need, instead.”