Indonesia signs economic agreement with Palestine amid rising poverty

Palestine signed an agreement with Indonesia that would allow entry of Palestinian dates and olive oil into Indonesia free of taxes, diplomatic sources in Jakarta say.

Palestinian ambassador to Indonesia Zuheir Alshin said the Indonesian minister of trade requested from him a list of Palestinian-made products that could be imported to Indonesia without tariffs.

Alshin added that the agreement could potentially point to a larger trade agreement between the two countries, according to the Palestinian Authority’s official news agency Wafa.

Indonesia has no official relations with Israel and is a strong supporter of Palestinian rights. In December when US President Donald Trump decided to recognise Jerusalem as Israel’s capital, thousands of Indonesians marched across their country to protest the decision.

Protesters halted traffic and chanted "Free Palestine" and "Jerusalem is the capital of Palestine".

Rising poverty rates in the face of cuts

Palestinians faced an economic slump after US President Donald Trump decided to slash funds to the UN Palestinian refugee agency (UNRWA) in January.

The cutting of funds plunged UNRWA into its worst financial crisis and the agency was subsequently had to lay off off dozens of teachers in East Jerusalem and the West Bank and some 100 workers in 13 refugee camps in Jordan.

"The US has announced it will contribute $60 million to the programme budget. There is for the moment no other indication of possible funding," UNRWA spokesman Chris Gunness said at the time.

"This dramatically reduced contribution results in the most severe funding crisis in the history of the agency."​

Trump's move was welcomed by Tel Aviv.