Israel to Loan the Palestinian Authority $155 Million, Resolve Residency Issues for 5,000

Israel's defense minister said Monday that Israel plans to loan $150 million to the Palestinian Authority and resolve residency issues for some 5,000 families living in the occupied West Bank, according to the Associated Press.

Defense Minister Benny Gantz's office confirmed that Israel will loan the Palestinian Authority 500 million shekels ($155 million) and will be repaid with tax funds that Israel normally collects for the Palestinians.

Israel will also resolve residency issues for some 5,000 families living in the West Bank, including Palestinians originally from Gaza and foreign spouses of local Palestinians, the AP said.

Hussein al-Sheikh, a senior Palestinian official overseeing relations with Israel, said the deal was "a first batch in the road to finalizing this file entirely."

For more reporting from the Associated Press, see below.

Hussein Al Sheikh Palestinian Territory
Israel has agreed to resolve the residency issues of people living in the occupied West Bank, starting with some 5,000 families. Above, Palestinian Authority Civil Affairs Minister Hussein al-Sheikh, left, escorts Egyptian Foreign Minister Sameh Shoukry following a press conference in the West Bank city of Ramallah on May 24. Abbas Momani/AFP via Getty Images

The series of gestures are aimed at strengthening the Palestinian Authority. The announcement came a day after Gantz met with Palestinian President Mahmoud Abbas in the first high-level meeting between the two sides in years.

The stepped-up contacts and Israeli gestures mark a shift in direction after the complete breakdown of communication between Abbas and Israeli leaders in recent years. Israel's new government has said it is interested in bolstering Abbas in his rivalry against Gaza's ruling Hamas militant group.

"The stronger the Palestinian Authority is, the weaker Hamas will be," Gantz was quoted as telling Israeli military correspondents Monday. "And the greater its ability to govern is, the more security we'll have and the less we'll have to do."

The Israeli moves come two days after President Joe Biden urged Israel's new prime minister during a White House meeting to take steps toward improving the lives of Palestinians.

Gantz's office said he told Abbas that Israel will take new measures to strengthen the Palestinian economy. It said they also discussed security issues and agreed to remain in touch. It was believed to be the highest level public meeting between the sides since 2014.

Israel will also authorize work permits for an additional 15,000 Palestinian laborers.

Israeli Prime Minister Naftali Bennett is a hard-liner who opposes Palestinian independence, as do key partners in his diverse, ruling coalition. But Bennett has said he supports building up the Palestinian economy and expanding autonomy for Palestinians.

He also is interested in weakening Hamas in the wake of an 11-day war last May. Egyptian-led attempts at brokering a long-term cease-fire have foundered in recent weeks, and Hamas has staged a series of violent demonstrations along the Israeli border in hopes of pressuring Israel into easing an economic blockade of the territory.

While Biden supports a two-state solution between Israel and the Palestinians, his administration is focused on interim confidence-building measures.

Israel's former prime minister, Benjamin Netanyahu, pursued a hard-line policy toward the Palestinians, backed by former President Donald Trump.

The Trump administration took a number of steps that favored Israel, including moving the U.S. Embassy from Tel Aviv to contested Jerusalem. Abbas halted most contacts with the U.S. and Israel in return.

Netanyahu had repeatedly claimed Abbas was not a reliable partner for negotiating a peace deal, a portrayal dismissed by Netanyahu critics as a pretext for avoiding making concessions.

Benny Gantz
Israeli Defense Minister Benny Gantz held talks on Sunday with Palestinian President Mahmoud Abbas in the first high-level meeting between the two sides in years. Above, Gantz attends a Cabinet meeting at the prime minister's office in Jerusalem on August 1. Abir Sultan/Pool Photo via AP, File