The US Department of State strongly criticized yesterday Thursday the decision of Israeli Finance Minister Bezalel Smotrich, which foresees the transfer of resources intended for the Palestinian Authority to “families of victims of terrorism”, characterizing it as “incredibly wrong”.

“We think this is an incredibly wrong decision by this secretary,” State Department spokesman Matthew Miller told the press.

He was reacting to a decision by a far-right cabinet minister in Prime Minister Benjamin Netanyahu’s government, announced Thursday, to sign an executive order transferring “approximately $35 million” of frozen Palestinian Authority funds “to victims of terrorism” in Israel.

“The Palestinian Authority encourages and favors terrorism by paying families of terrorists, jailed and released prisoners,” the far-right finance minister said, justifying the decision.

For Washington, “these types of measures on the part of the Israeli government raise the risk of destabilizing the West Bank and further undermining Israel’s own security”, while the war in the Gaza Strip has further escalated the violence in the occupied Palestinian territory.

“We have clearly told the Israeli government that these funds belong to the Palestinian people. They must be handed over to the Palestinian Authority immediately, they must not be withheld, they must not be delayed,” Mr. Miller insisted.

The US diplomat also pointed out that the Palestinian Authority “has worked very hard to maintain calm and stability in the West Bank” over the years, “especially after October 7”, the day Hamas’ military arm launched unprecedented raid on southern sectors of Israeli territory, triggering the war in the Gaza Strip.

Under agreements made in the 1990s, Israel collects funds (taxes, etc.) on behalf of the Palestinian Authority, then transfers the money to it. But the Israeli authorities froze the transfers from October 7.

In a report released in May, the World Bank estimated that the Palestinian Authority of Mahmoud Abbas is on the verge of economic suffocation, due to the complete cessation of resource transfers and the deep recession of the Palestinian economy.