Updates: Salama Warns of Huge Financial Issues and Reveals Anticipated International Support

Follow-up from SadaNews - The Minister of Planning and International Cooperation and the Acting Minister of Finance, Dr. Estephan Salama, revealed the magnitude of the financial challenges facing the Palestinian Authority, emphasizing that there are around 380 cases filed against the Authority before Israeli courts. He explained that if rulings are issued in favor of Israel, the Authority will be required to pay approximately 20 billion shekels, which poses a serious threat to financial stability.

This was stated during a press conference organized by the Government Communication Center in Ramallah today, Wednesday, which included Acting Minister of Finance Dr. Estephan Salama and economic journalists, with SadaNews participating.

Salama also indicated that the Palestinian government spends around 46 million shekels monthly for Palestinian hospitals, in line with its commitment to provide health services for citizens despite the difficult economic circumstances.

In another context, the minister announced that the government expects financial support from Switzerland and Japan this month amounting to 18.5 million dollars, which will contribute to enhancing the Authority's ability to meet its financial obligations and alleviate existing pressures.

Salama stressed that the Ministry of Finance works with complete transparency and is open to all oversight institutions, affirming that the investigation with some employees does not necessarily imply their guilt, and that no one is above the law. He highlighted the need to strengthen oversight systems within the Ministry.

He said: "We are suffering from a profound existential financial crisis as Israel continues to withhold clearance funds for the seventh consecutive month, and despite all international pressures, there is until now no prospect for the release of clearance funds soon." He pointed out that the Israeli deductions from clearance funds have exceeded 4 billion dollars, which is a significant amount for a country the size of Palestine.

He noted that local revenues grew by 33 percent by the end of November compared to the corresponding period last year, which was not sufficient in light of the withholding of clearance funds that constitute 68 percent of revenue.

He indicated that 82% of the national budget comprises salaries and similar payments, noting that the national authority pays monthly salaries and similar payments to 291,844 beneficiaries, including 120,472 civil employees and 52,353 military personnel, of whom 35,000 are actively working in the West Bank, in addition to salaries for retirees, casual workers in Gaza, and social grants.

He mentioned that the government relied this month on the Saudi grant, the European grant, and some settlements with companies to pay a portion of the salary, and did not resort to banks as in previous months.

He said: "To secure 60% of the salary and 2000 shekels as a minimum, we need to ensure the provision of 750 million shekels."

He added: "To fully pay salaries and cover operational expenses and public debt service, 1.6 billion shekels are needed monthly."

He continued: "The cumulative public debt owed by the state until the end of November 2025 has reached 14.6 billion dollars."

Salama stated that "the debt to the pension fund has reached 4.5 billion dollars, while debts to local banks amount to 3.4 billion dollars."

In another regard regarding public employees' dues, he clarified that they amounted to 2.5 billion dollars, while the private sector's dues to the government amount to 1.65 billion dollars, most of which are owed to the private health sector.

He explained that "external debt has reached 1.4 billion dollars, in addition to other debts amounting to 1.2 billion dollars."

The minister confirmed that Israel has been withholding clearance funds for seven months, exceeding 4 billion dollars, which constitutes 68% of the total public revenues.