Saudi Finance Minister Ibrahim al-Assaf announced the decision in a telephone conversation with acting PA chief Mahmoud Abbas, the official Palestinian news agency, WAFA, reported late Wednesday.
The Palestinian Authority is grappling with a severe budget deficit caused by Israel seizing Palestinian assets after the United Nations agreed late last year to upgrade the Palestinians’ status to a nonmember observer state.
Infuriated by the successful Palestinian bid at the UN General Assembly, Israel decided to withhold the tax and tariff revenues it collects on behalf of the PA.
In December, Arab states agreed to provide the Palestinian Authority with a USD100 million monthly "financial safety net" to help Ramallah cope with the shortfall.
However, funds have yet to materialize despite pledges to deliver the money, which has left the PA unable to pay thousands of government employees waiting half their salaries from November and all their salaries from December.
Thousands of government workers across the West Bank embarked on a strike in December over unpaid wages, saying they could not even afford to travel to work.
