The European Union (EU) will announce a €1.6 billion ($1.8 billion) financial support for the Palestinian Authority (PA) conditional on reforming the PA, reported Reuters.
The announcement came days before a high-level political dialogue that will bring together the EU’s foreign ministers and senior Palestinian officials, including the Palestinian Prime Minister, Mohamed Mostafa, in Luxembourg on Monday.
Boosting Financial Support
During an interview with Reuters, the European Commissioner for the Mediterranean, Dubravka Suica, said that the EU will increase its financial support to the PA through a three-year package valued at around €1.6 billion.
However, this package must be accompanied by reforms in the PA. “We want them to reform themselves because without reforming, they won’t be strong enough and credible in order to be an interlocutor, not only for us, but an interlocutor also for Israel,” Suica said.
The EU is the biggest donor to Palestinians and a supporter of the two-state solution to end the Palestinian-Israeli conflict. The bloc hopes that the PA, which currently runs the West Bank, could one day govern Gaza after the ongoing war between Hamas and Israel comes to an end.
However, the Israeli government, under Benjamin Netanyahu, has opposed the idea of the PA governing Gaza and evaded the EU’s endeavor for a two-state solution, which entails the establishment of a Palestinian State.
Required Reforms
According to Suica, the support package will be allocated as follows: 620 million euros for the financial support and reform of the PA; 576 million euros for “resilience and recovery” of the West Bank and Gaza; and more than 400 million euros will be in the form of loans from the European Investment Bank, subject to its approval.
The European Commissioner for the Mediterranean added that the average EU support for the PA had reached around 400 million euros over the past 12 years. “We are investing now in a credible manner in the Palestinian Authority,” Suica noted.
EU-Palestine Dialogue
On Monday, April 14, 2025, the first high-level political dialogue between the EU and Palestine will take place in Luxembourg to tackle political issues and bilateral relations. During the dialogue, the EU and PA will discuss the conflict in Gaza, the recent developments in the West Bank, and prospects for advancing the two-state solution.
The officials will also review bilateral relations, including the PA’s reform agenda and how the EU could provide support in this regard. The High Representative of the European Union for Foreign Affairs and Security Policy, Kaja Kallas, and the Prime Minister and Minister of Foreign Affairs of the PA, Mohammad Mustafa, will co-chair the meeting.
Reforming PA
In recent weeks, the Palestinian Authority has embarked on a series of reforms and changes, in line with what the PA President, Mahmoud Abbas, announced during the Emergency Arab Summit, which took place in Cairo on March 4, 2025.
Back then, Abbas revealed that he would appoint a vice president for Palestine and for the Palestine Liberation Organization (PLO), in response to local and international calls for reforms. Moreover, he pledged to restructure leadership frameworks in the state and revitalize the PLO, Fatah and state agencies.
In the light of this, Abbas will convene an extraordinary meeting for the Palestinian Central Council to establish the vice president position, Asharq Al-Awsat reported. The meeting will take place in Ramallah, with 180 council members invited to establish the new position, but not necessarily appoint a person to fill it. The meeting will also discuss efforts to reclaim Gaza and foster national unity.
Postwar Gaza
At the Emergency Arab Summit for Palestine, held in Cairo on March 4, 2025, the Arab countries unanimously endorsed a $53bn plan which will rebuild Gaza without displacing Palestinians from their territory. The plan, developed by Egypt, consists of an early recovery plan and two key phases over five years.
The plan involves building hundreds of thousands of housing units, as well as launching major infrastructure projects. It also provides for an independent committee of non-factional technocrats to administer Gaza for a transitional period, under the supervision of the Palestinian Authority, while enabling the PA to return to Gaza.
The Gaza reconstruction plan got worldwide support, with France, Germany, Italy and the UK issuing a joint statement backing the plan. The three European countries stressed their stance regarding who will rule postwar Gaza, expressing support for the PA. “We are clear that Hamas must neither govern Gaza nor be a threat to Israel any more. We explicitly support the central role for the Palestinian Authority and the implementation of its reform agenda,” the joint statement said.
