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Jerusalem Center for Public Affairs
Strategic Alliances for a Secure, Connected, and Prosperous Region

Saudi Arabia and the Palestinian Authority – Ties Are Fraying

Filed under: Egypt, Jordan, Palestinians, Saudi Arabia, The Middle East

The crisis that Mahmoud Abbas has reached in recent weeks with the “Arab Quartet” (Egypt, Jordan, Saudi Arabia, and the United Arab Emirates), after rejecting their request to reconcile with his bitter adversary Muhammad Dahlan, has left its mark on the Palestinian Authority’s relations with these countries.

Saudi King Salman receives a painting of Jerusalem from President Abbas in his Jeddah palace in June, 2016.
Saudi King Salman receives a painting of Jerusalem from President Abbas in his Jeddah palace in June, 2016.

Egypt is holding academic and economic conferences for important figures from the Gaza Strip – independently of the PA. It intends to open the Rafah crossing regularly for a few days each month and is considering establishing a free trade zone in Rafah—all as a gesture to Dahlan and in order to boost his status as part of the succession battle.

Jordan, too, has been expressing its anger at Abbas’ behavior.

The newspaper Ra’i Al-Yawm reported on November 11, 2016, that Jordan is considering revoking the citizenship and Jordanian passports of 22 individuals from the PA—first and foremost Abbas—as part of a revision of its policy in response to Abbas’ recent overtures to Turkey and Qatar without consulting with Jordan.

There still is no real break between Abbas and the “Arab Quartet.” Yet commentators in the Arab world do not rule the possibility that Abbas, because of his behavior, could lose Arab legitimacy.

Where Are the Funds?

One of the factors that gravely concerns the PA is Saudi Arabia’s delay in transferring aid money to it.

Jibril Rajoub, a member of the Fatah Central Committee who also sees himself as Abbas’ successor, was interviewed on November 11, 2016, on the Al Mayadeen television channel. He denied reports that there is a connection between the delay in Saudi aid to the PA and Abbas’ rebuff of the “Arab Quartet’s” demand to reinstate Dahlan in Fatah.

“This is a logistical matter and nothing more,” Rajoub claimed.

Mahmoud Abbas and Muhammed Dahlan in the past
Mahmoud Abbas and Muhammed Dahlan in the past (Al Sawt)

Saudi Arabia has been holding up its aid commitments to the PA for seven months. The aid is supposed to come to $20 million per month; the Saudis now have a debt to the PA of $140 million.

Saudi Arabia is the largest Arab contributor to the PA’s coffers. Up to 2014, the Saudis gave the PA a monthly sum of $14 million; it then raised the total to $20 million each month. 

The Saudi aid money constitutes a third of the PA’s annual budget. If the cutoff continues, then by the end of the year the PA could be plunged into a budgetary deficit and financial crisis where it would be unable to pay its officials’ salaries amid growing instability.

Saudi Arabia did suspend aid to the PA before its dispute with the PA over Dahlan began. However, despite Rajoub’s claims that Saudi Arabia does not support Dahlan, senior figures in Fatah say the Saudi aid cutoff is aimed at expressing its displeasure with Abbas’ behavior.

A senior Fatah source says that what is ultimately involved is “political money,” with Saudi Arabia using its financial lever to pressure Abbas as part of a carrot-and-stick policy toward the PA and its leader.

There are other reasons for the aid cutoff. Saudi Arabia’s war against the Houthi rebels in Yemen has entailed high expenditures for the kingdom. 

It is also undergoing a financial crisis caused by the decline in crude oil prices 60 percent, with the price of a barrel of oil plummeting from $120 to $50.

According to Arab sources, Saudi Arabia wants greater influence over the Palestinian issue and a future political settlement with Israel. It recently tried to revive the Arab Peace Initiative and to make changes in it via the initiative of Egyptian President Sisi. Abbas, however, totally rejected the Egyptian initiative and stuck with the French initiative, which aims at convening an international conference by the end of the year.

Saudi Arabia is also worried by Abbas’ attempts to court Iran; it wants him to enhance the cooperation with Riyadh on regional issues. The Saudis were nonplused by Abbas’ visit to Turkey and Qatar two weeks ago as an act of defiance against the “Arab Quartet.” The visit, however, did not lead to a breakthrough in the relations between Fatah and Hamas and ultimately failed. 

PA sources assert that the cooling of Saudi-PA ties is only temporary and that the Saudis will eventually renew the aid to the PA because they do not want it to collapse.

It is possible, however, that the Saudis will link the aid renewal to conditions that it will set for Abbas.

The aid cutoff even further weakens Abbas’ shaky status among the Palestinian population and undermines his support in Fatah. Abbas, however, is determined to do whatever is necessary to ensure a “safe passage” for himself and his family members when he retires from political life and goes to live in Qatar. He is gambling that Saudi Arabia will eventually mend fences with him, so that it can be perceived as not having abandoned the Palestinian issue and as rescuing the PA from financial collapse.