Mustafa: No Reform or Strategy Can Succeed Without the Necessary Political and Economic Conditions for Implementation

SadaNews -  Prime Minister Dr. Mohammed Mustafa and the European Union Commissioner for Middle East Affairs Dubravka Šuica chaired the second ministerial meeting of the donor group for Palestine today, Monday, at the European Commission headquarters in the Belgian capital, Brussels, with the attendance of nearly 65 representatives from donor countries, institutions, and international partners to discuss support for the Palestinian government and enhance the response to the needs of early recovery and reconstruction in the Gaza Strip.

The Prime Minister stated during his speech at the meeting: "The devastating war on Gaza has left unprecedented destruction, enormous humanitarian suffering, and a set of political, economic, social, and security challenges. In the West Bank, including East Jerusalem, the pace of annexation and settlement expansion, settler terrorism, and restrictions on movement is escalating, in addition to ongoing Israeli measures to undermine the Palestinian Authority, thereby undermining the viability of the two-state solution."

He added: "Since October 2023, the Palestinian economy has contracted by 30%, and the unemployment rate has risen to 50%, resulting in the loss of over 500,000 citizens from their jobs. The financial deficit has reached unprecedented levels due to Israel's continued withholding of Palestinian clearance revenues and restrictions imposed on our financial and economic system."

Mustafa further explained: "Over the past fifteen months, Israel has completely halted the regular transfers of Palestinian clearance revenues, significantly constraining the Palestinian government’s ability to meet its commitments. Despite these challenges, the Palestinian government has remained active, responsible, and committed to reform, stability, and institution-building."

The Prime Minister clarified that the government has adopted an 18-month strategy aimed at transitioning from reform to recovery, enhancing resilience, reunification, and state-building, focusing on five main axes: First, building national resilience and empowering vulnerable communities. Second, enhancing state institutions, governance, and the rule of law. Third, supporting the recovery of Gaza and the gradual resumption of governmental responsibilities there. Fourth, promoting economic self-sufficiency by investing in productive economic sectors, digital services, food security, and energy security. Fifth, enhancing political action by expanding recognition of the State of Palestine in partnership with the global coalition and other international partners.

Mustafa emphasized that the success of the strategy requires: First, all partners to enhance their political support for the Palestinian Authority and take decisive steps to end the illegal Israeli occupation and expand recognition of the State of Palestine.

Second: Transforming the temporary partnership agreement between the European Union and the Palestine Liberation Organization from 1997 regarding trade and cooperation into a full partnership agreement.

Third: An immediate and guaranteed financial support from the European Union and regional and international partners to the emergency budget to enable the government to maintain essential public services, ensure institutional continuity, and continue implementing its reform program.

Fourth: A coordinated international effort to enable the immediate commencement of the revitalization and reconstruction of Gaza by providing the necessary funding and ensuring the unrestricted entry of humanitarian aid, commercial goods, and required reconstruction materials.

Fifth: Supporting all partners in measures that enhance Palestine's capacity to manage its economy and public finances.

The Prime Minister pointed out that no reform or strategy can succeed without the necessary political and economic conditions for implementation, and that economic recovery cannot be restored while revenue withholding continues, and freedom of movement and access remain restricted. Moreover, progress on the two-state solution cannot move forward without genuine political support and a reliable path to ending the occupation.

Mustafa stated: "Israel’s repeated violation of its commitments under the protocol, including withholding Palestinian tax revenues, imposing restrictions on banking relations, continuing restrictions on the return of shekels, restricting the movement of people and goods, and revoking permits for Palestinian workers, has severely harmed the Palestinian economy, undermined its stability, and pushed it to the brink of collapse."

The Prime Minister stressed that if Israel can no longer implement the customs union model agreed upon under the Paris Protocol and respect it, then the international community must support the establishment of an independent Palestinian customs system.

Mustafa also emphasized that if the existing banking and monetary arrangements cease to function effectively, support should be provided for the gradual establishment of a Palestinian currency and the development of the Palestinian Monetary Authority into a fully empowered central bank, as these measures are essential to drive the momentum of the Palestinian economic recovery, enhance economic sovereignty and resilience, and lay the foundations for long-term stability.

During the meeting, Mustafa reviewed the significant progress made in the reform and institutional development agenda across four axes and 53 main items, despite exceptional political and financial constraints, with most of the agreed-upon reform measures accomplished and the remaining procedures reaching advanced stages of implementation.

He stated: "In the area of public financial management, we have strengthened financial discipline through spending controls, improved debt and financial risk management, and advanced reforms aimed at reducing net lending and improving budget sustainability. In the area of social protection, we have made an unprecedented shift in the Palestinian social welfare system in decades through a new unified framework for social protection, implementing Law No. 4 of 2025 in place of fragmented assistance programs, using a single transparent system based on needs with an independent oversight structure, supported by a national digital platform."

He added: In the field of education, we have worked in line with UNESCO standards and best international practices, while continuing to implement the political reform program set by President Mahmoud Abbas, where municipal elections were successfully held across Palestine, including Deir al-Balah in the Gaza Strip, demonstrating our ongoing commitment to democratic participation despite extremely challenging circumstances. I affirm that President Abbas issued, a few days ago, a decree calling for national legislative elections across Palestine on November 28 of this year."

Mustafa expressed his sincere gratitude to Commissioner Šuica and the European Union for their ongoing partnership with Palestine and extended his thanks to all partners, donor countries, international organizations, and international financial institutions for their steadfast support for the Palestinian people and the Palestinian government during one of the most difficult periods in modern history.

He concluded, "Your ongoing political, humanitarian, and financial support reflects more than mere solidarity with the Palestinian people; it represents a shared commitment to maintaining the viability of the two-state solution, strengthening the Palestinian Authority and its institutions, supporting regional stability, and achieving a just, lasting, and comprehensive peace based on international law, relevant United Nations resolutions, and the Arab Peace Initiative."