The European Union (EU) works with the Palestinian Authority (PA) to build up the institutions of a future democratic, independent and viable Palestinian State living side-by-side with Israel in peace and security. 

The EU is active in the Middle East Peace Process and is a member of the Middle East Quartet (with the United States, Russia and the United Nations), working towards a two-state solution based on the 2003 Roadmap for Peace. These efforts are regularly debated by the EU Council of Ministers. 

In the context of the ‘European Neighbourhood Policy (ENP), the EU has entered into a number of partnership arrangements that collectively guide the relationship between the EU and the Palestinian Authority. These include the: 

• Interim Association Agreement on Trade and Cooperation signed with the PLO on behalf of the PA and setting out the legal basis for EU-PA relations.
• The Neighbourhood, Development and International Cooperation Instrument (NDICI) – ‘Global Europe’ for the period 2021-2027 is the EU’s main instrument for international partnerships with Palestine, which defines the EU financial support.
• The EU-Palestine Action Plan under the European Neighbourhood Policy was approved in May 2013, setting the agenda for economic and political cooperation with the EU. The Action Plan was prolonged for additional three years, until 2025.
• Single Support Framework (SSF), covering 2014, 2015 and 2016 and setting out assistance priorities of intervention on a multi-annual basis. 
• As from 2017 the SSF has been replaced by the "European Joint Strategy in support of Palestine 2017-2020 – Towards a democratic and accountable Palestinian State", and its successor “European Joint Strategy in support of Palestine 2021-2024 Towards a democratic, accountable and sustainable Palestinian state”

The EU is the most important donor for the Palestinian people and a reliable and predictable partner. It is present at all levels of Palestinian life, from supporting the establishment of the future Palestinian State and building new infrastructure across Palestine to supporting Palestinian civil society. 

A large part of the European Union's assistance to the PA is channelled through PEGASE mechanism. PEGASE is the financial mechanism launched in 2008 to support the Palestinian Authority Reform and Development Plan (2008-2010) and subsequent Palestinian national plans. It contributes to the payment of PA civil servants' salaries, pensions and social allowances for the poorest and most vulnerable Palestinian families. PEGASE also supports major reform and development programmes in key ministries to help prepare for statehood. 

Every year the EU contributes EUR 82 million to UNRWA, the UN Agency providing essential services to Palestinian refugees.

Financial assistance falls under the  Neighbourhood, Development and International Cooperation Instrument (NDICI) – ‘Global Europe’ for the period 2021-2027.The EU has also developed a long-standing relationship with Palestinian civil society and provides significant support for civil society initiatives. Major EU programmes support good governance, human rights, peace-building, gender and culture. In 2018, the EU adopted the Joint European Roadmap for engagement with Civil Society 2018-2020 in Palestine.

The EU also funds various infrastructure projects, judicial and financial reform initiatives, and programmes supporting Palestinian security, health and education systems. 

The EU has provided humanitarian aid to help meet Palestinians’ basic needs since 2000. It channels support through ECHO, the European Commission’s humanitarian aid department, and the UN Office for the Coordination of Humanitarian Affairs (OCHA).

ECHO works with many active partners in Palestine, including United Nations agencies, the Red Cross/Red Crescent movement and international non-governmental organisations. ECHO also finances humanitarian programmes that benefit Palestinian refugees living in Jordan, Lebanon and Syria. 

Since 2000, ECHO has provided EUR 700 million of humanitarian aid to Palestinians in the Gaza Strip and the West Bank. 

Joint Programming is the joint planning of development cooperation by EU development partners working in a partner country. It is a policy tool contributing to a stronger Europe and bringing together resources and capacities. Now, more than ever, the European Union, the Member States and other like-minded governments need to join forces, programme their development aid together and, eventually, develop a strategic and coordinated response to key challenges such as migration and climate change. Working closely together will enhance the EU's ability to decisively contribute to the partner country's national development plan and to support our partners in the implementation of the 2030 Agenda for Sustainable Development and the Addis Ababa Action Agenda. More information on how Joint Programming progresses in each partner country: capacity4dev.eu 

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Despite the very specific situation of Palestine –a densely populated, fragmented and complex political context – the Office of the European Union Representative (EUREP) and Member States (EU MS) have worked towards an EU Joint Programming (EU JP) in Palestine since 2011. An EU/MS Division of Labour and an EU JP Roadmap were developed in respectively 2011 and 2012, and have been regularly updated since then. In October 2013, two like-minded countries (Norway and Switzerland) joined the process and joint work. 

EU JP has been understood by European development partners in Palestine in its two dimensions: aid effectiveness (how to improve the efficiency and effectiveness of the considerable EU/MS financial effort in Palestine) and political dimension (affirm and defend the shared vision of European actors in Palestine and ensure the convergence between the development work and the political objectives of the EU). 

Since the end of 2015, European development partners have been working on developing the first-ever European Joint Strategy, which is closely aligned to the new Palestinian National Policy Agenda (NPA) 2017-2022 and in line with the Sustainable Development Goals. This Strategy is locally owned and is the result of extensive meetings and discussions amongst the European development partners, Palestinian ministries, civil society organisations, the business community, the United Nations (UN) family and many other key actors. 

The aim of the strategy is to maximise aid coordination and aid effectiveness amongst EU Development Partners and reinforce our ability to address through development funding our objectives. 

 EU's interventions will focus on the following five interrelated pillars: 

1. Democracy, Rule of Law and Human Rights 
2. Governance Reform, Fiscal Consolidation and Policy 
3. Sustainable Service Delivery 
4. Climate Change, Access to Self-Sufficient Water and Energy Services 
5. Sustainable Economic Development

Key cross-cutting issues are also mainstreamed in the Pillars (i.e. gender equality, environment, human rights, youth and civil society engagement). While European development partners recognise the geographical disparities and challenges related to them, Palestine is treated as "one" in the Strategy, as to ensure that the geographical fragmentation is not further reinforced. The specific needs of East Jerusalem, Area C and the Gaza Strip (areas where the role of the Palestinian Authority is severely limited due to different political, administrative and security arrangements) are however acknowledged. Support to Palestine refugees across the Middle East continues to be an important priority for EU development partners. 

The European Joint Strategy is seen as an opportunity for European development partners to be more coherent and to reinforce EU's values and principles on the ground – as reflected in the new influencing tools/strategies included in the joint response of the Strategy. The Strategy however also acknowledges that only a credible, realistic and brave political solution can put an end to the protracted occupation and ensure that European development partners effectively contribute to the two-state solution and build sustainable livelihoods for all Palestinians.