Despair and fear is on the rise among Palestinian Authority employees [one of the largest sectors of the employed in Palestine] because of the delay in getting their salaries.
After the , European Union, and other countries declared they would cease sending financial assistance to the Palestinian government after the Hamas party won the Palestinian Legislative Council elections, a major percentage of Palestinians are going without paychecks.

In the recent past, before the Hamas win, millions of dollars of aid came to the Palestinian government which helped immensely to pay employees in a land frozen by closures, checkpoints, attacks on agricultural lands, and production facilities. Now the Hamas government is running on next to nothing.

The situation worsened after the Israelis stopped paying the Palestinian Authority the taxes that it owes upon having frozen PA bank accounts several years ago. The owed taxes are in the neighborhood of an estimated 60 million USD per month.

Palestinian Authority Minister of Finance, Omar Abed Al Razeq says that the monthly due for 140,000 PA employee salaries is approximately 118 million USD.

Palestinian employees in the public sector are facing debts and major problems as they are not able to satisfy the basic demands from their families for essentials such as bread and school supplies. Many, such as an unnamed civil employee working in the PA in Bethlehem, have already taken out numerous bank loans which they cannot afford to repay.

An employee in the Ministry of Economy, who also chooses to remain unnamed, says that he can no longer use his car as he cannot afford to buy gas. He also told PNN that the supermarket refuses to supply him with basic needs because of debts he has already accumulated during these trying times. He has the same problem with other merchants. And this is not to mention the position that Palestinian merchants are in as they cannot afford to take care of their own families either. The Ministry of Economy employee added, “My friends refuse to loan me any more money.”

The wife of another PA employee said that their life has been transformed into hell and that they do not know what to do, especially as they absolutely depend on the salary earned from the PA. She added that she asked her father in to send her money until the problem of salaries is solved.

The Palestinian banking sector is also facing problems, as some 70 percent of PA employees took out loans on the guarantee of their salaries. These are loans that Palestinians can no longer hope to repay in the near future. A bank employee said that the situation is very difficult as the banks do not know how to deal with such situation. He added that banks may be forced to change its lending policy, making it more strict and imposing more conditions.

The salary problem directly affects economic life in the West Bank and the Gaza Strip as markets are empty. A taxi driver said the people are now walking other than to take a two shekel taxi ride [around 20 US cents].

Sales of many products have fallen, such as mobile phones and the cards to refill the minutes on them.

As all hope that the new government will find a solution, it is clear that the Palestinian economy, already on the brink of collapse, is now collapsing as the international community punishes the Palestinian population for exercising its democratic right at the ballot boxes on 25 January by electing the Hamas government.