LUXEMBORG: The European Union on Monday announced a new three-year financial support package for the Palestinian Authority (PA) worth up to 1.6 billion euros ($1.8 billion). The fresh aid pledge came just ahead of a meeting between Palestinian Prime Minister Mohammed Mustafa and EU foreign ministers in Luxembourg.

"We are stepping up our support to the Palestinian people. €1.6 billion until 2027 will help stabilize the West Bank and Gaza," EU foreign policy chief Kaja Kallas wrote on X. "This will reinforce the PA's ability to meet the needs of the Palestinian people in the West Bank and prepare it to return to govern Gaza once conditions allow," Kallas said.

EU officials hope the Palestinian Authority, which runs the West Bank, may also one day take responsibility for Gaza after the Zionist entity stops attacking the territory. Zionist Prime Minister Benjamin Netanyahu's government, however, has so far rejected the idea of handing over Gaza to the PA and shunned the EU's broader aim of a two-state solution, which would include the establishment of a Palestinian state.

Brussels — the biggest international donor to the Palestinians — said the package would include 620 million euros in grants for the Palestinian Authority. Dubravka Suica, the European Commissioner for the Mediterranean, said the financial support would go hand in hand with reforms of the Palestinian Authority, which has been accused by critics of corruption and bad governance. "We want them to reform themselves because without reforming, they won't be strong enough and credible in order to be an interlocutor, not for only for us, but an interlocutor also for (the Zionist entity)," Suica said.

The funds will be linked to reforms on "fiscal sustainability, democratic governance, private sector development and public infrastructure and services", the EU said. The rest will be made up of 576 million euros in grants for projects aimed at helping economic recovery in Gaza, the West Bank and East Jerusalem. A further 400 million euros in loans would come from the bloc's lending arm, the European Investment Bank.

The EU's new package follows on from the previous three-year support plan worth 1.36 billion euros from 2021 to 2024. Suica said average EU support for the PA had amounted to about 400 million euros over the past 12 years. "We are investing now in a credible manner in the Palestinian Authority," she said. — Agencies