Israel Cancels Norway's Role as Intermediary for Palestinian Funds

Israel has decided to cancel an agreement with Norway to serve as an intermediary for transferring funds to the Palestinian Authority (PA). This decision comes in the aftermath of the October 7 Hamas-led massacre in the northwestern Negev and follows Norway’s recognition of a Palestinian state in May, along with statements by Norwegian Foreign Minister Espen Barth Eide criticizing Israel's actions in the ongoing Gaza conflict.

The Israeli Cabinet recently made this decision, which was kept confidential until it was reported by Ynet on Wednesday. The move reflects growing tensions between Jerusalem and Oslo over their differing positions on the conflict.

Norwegian Foreign Minister Espen Barth Eide has been vocal about his criticism of Israel’s actions in Gaza, which has led to strained diplomatic relations. In response, Israeli Foreign Minister Israel Katz rejected a request from his Norwegian counterpart for an official visit to Israel last month.

Earlier this year, in February, Norway agreed to act as an intermediary to transfer funds to Ramallah. Israel’s Security Cabinet had previously decided to freeze funds intended for the Palestinian Authority, concerned that they would be redirected to the Gaza Strip and potentially fall into the hands of Hamas. Instead, Jerusalem chose Norway to hold the funds as a third party.

The decision to remove Norway from this role, which is supported by the United States, aims to prevent any funds earmarked for Gaza from reaching the Palestinian Authority "under any circumstances" without the approval of Israel’s finance minister, according to a statement from the Prime Minister’s Office.

The Israeli Finance Ministry collects taxes and customs duties on behalf of the Palestinian Authority, which it transfers monthly. However, these funds have been frozen to ensure they are not used to support Hamas’s activities in Gaza.

As Norway is removed from its intermediary role, Switzerland is reportedly being considered as a potential replacement to handle these financial transfers, according to Ynet.

This development underscores the complexities of international diplomacy and the challenges of managing financial aid in a conflict zone. The decision to find a new intermediary reflects Israel’s ongoing efforts to control the flow of funds to ensure they do not support hostile activities.

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