Palestinian President Mahmoud Abbas has asked his West Bank-based government to prepare for replacing the words “Palestinian Authority” with “State of Palestine”.
The order by Abbas on Sunday applies to all public documents, including ID cards, driving licences and passports.
Israeli officials declined comment, including whether Israel would prevent Palestinians with new ID cards and passports from crossing borders and checkpoints.
“Whether the changes are really implemented is unsure because of the political situation right now,” said Al Jazeera’s Jane Ferguson, reporting from Jerusalem. “But the move is to regain momentum after the UN vote.”
In late November, Abbas won UN recognition of a state of Palestine in the occupied West Bank, Gaza and East Jerusalem, overriding Israeli objections to the largely symbolic step.
The UN bid gave the Palestinians new diplomatic leverage by affirming the borders of a future state of Palestine in lands Israel captured in 1967, but changed little in the day-to-day lives of Palestinians.
Set up two decades ago as part of interim peace deals with Israel, the self-rule government was meant to be temporary and replaced by a fully functioning state of Palestine – to be established through negotiations with Israel.
However, those talks repeatedly broke down, and for the past four years the two sides have been unable to agree on the terms of renewing the negotiations.
In an apparent response to the UN move, Israel in December halted its monthly transfer of about $100m in tax rebates it collects on behalf of the Palestinians. That sum amounts to about one-third of the monthly operating costs of the Palestinian Authority, which now only takes in about $50m a month in revenues.
Israel has said it used the withheld money to settle Palestinian Authority debt to Israeli companies, and it is not clear whether the transfers will resume.
As a result, the Palestinian Authority is on the “verge of being completely incapacitated”, Prime Minister Salam Fayyad warned on Sunday.
In an interview with the Associated Press news agency, Fayyad attributed his government’s “extreme jeopardy” and unprecedented financial crisis to failure by Arab countries to send hundreds of millions of dollars in promised aid.
The 22-nation Arab League has not kept a promise to make up for the funds Israel withholds, Fayyad said.
The cash crunch has gradually worsened in recent years, and the Palestinian Authority now has reached the point of not being able to pay the salaries of about 150,000 government employees, Fayyad said.
‘Money Should Go Forward’
While European countries have kept their aid commitments, about $200m in US aid was held up by Congress last year – a sum President Barack Obama’s administration hopes to deliver to the Palestinians this year, along with an additional $250m in aid.
The Palestinian Authority has relied heavily on foreign aid since the outbreak of the second Palestinian uprising in 2000.
It has struggled to wean itself off foreign support, in part because harsh Israeli restrictions on Palestinian trade and movement have hurt economic growth.
Only a year ago, Fayyad said he hoped to increase local revenues, including through spending cuts and higher taxes for wealthier Palestinians. But his tax plan was met by widespread protests and modest economic growth slowed.
Fayyad said he managed to pay half of his November salaries by getting a bank loan, using as collateral Arab League promises of future support. He said he cannot pay the rest of the November salaries, let alone December wages.
(Al Jazeera and agencies – www.aljazeera.com)