JERUSALEM — The Palestinian Authority said Tuesday that it was resuming its cooperation with Israel, ending six months of financial hardship for tens of thousands of West Bank residents and signaling relief over the election of Joseph R. Biden Jr.
It was one of the first clear signs that anticipation of a new administration in Washington is having an effect on international relations.
The Palestinian announcement undid a set of stringent measures imposed by Mahmoud Abbas, the authority’s president, in May in a desperate protest against plans by Prime Minister Benjamin Netanyahu of Israel to unilaterally annex large portions of the occupied West Bank.
The Trump administration had indicated it would support some form of annexation, which would have imposed Israeli sovereignty over land that the Palestinians have counted on for a future state.
Mr. Abbas cut off security coordination with Israel, raising fears that attacks might go unprevented. He also severed civilian ties, including those that help Palestinians travel into Israel for work or medical treatment.
Most painful of all to his own people, Mr. Abbas stopped accepting routine transfers of more than $100 million a month in taxes that Israel collects on the Palestinians’ behalf, funds that account for more than 60 percent of the authority’s budget. The lack of funds forced salary cuts for tens of thousands of public-sector employees, compounding what was already a devastating economic crisis because of the pandemic.
“Praise God, I feel so relieved,” Rami Kitaneh, 35, a nurse at the Hugo Chavez Ophthalmic Hospital in the central West Bank, said Tuesday night. “I gave up so much since the start of the crisis, but now I can breathe.”
The annexation plans were shelved, not canceled, and not in response to the Palestinians’ kamikaze-style pressure tactics. Mr. Netanyahu agreed to “suspend” annexation in exchange for a landmark diplomatic accord with the United Arab Emirates. That agreement, and a subsequent one with Bahrain, stunned the Palestinians and shattered decades of Arab solidarity behind the idea that Israel should be isolated until the Palestinians achieved statehood.
Tuesday’s reversal, similarly, highlighted the Palestinians’ severely weakened position with two months remaining in a Trump administration that has pounded away at them relentlessly.
It was accompanied by none of the concessions from Israel that many Palestinian officials had hoped for in return for resuming cooperation with Israel, such as a formal statement that annexation was off the table. In effect, the election of Mr. Biden, who has stated his opposition to unilateral moves by Israel, gave the Palestinians the assurances they needed.
Spokesmen for the White House and the Biden transition team had no comment Tuesday on the Palestinian decision.
The announcement came just two days after Israel opened the bidding process for the construction of 1,257 homes in Givat Hamatos, a long-planned settlement that critics say undermines the possibility of a two-state solution to the Israeli-Palestinian conflict. The settlement would deny territorial contiguity to parts of East Jerusalem, which the Palestinians want to make their capital.
On Wednesday, Secretary of State Mike Pompeo is to arrive in Israel, where he is expected to become the highest-ranking United States official to visit an Israeli settlement, stopping at a vineyard that overlooks the Ramallah area.
Palestinian leaders had abundant reasons to resume cooperation with Israel and few reasons not to. Their banks, whose liquidity had been depleted by the self-inflicted cash crunch, had informed them they could no longer lend the Palestinian Authority money, endangering its ability to operate. International donors, chiefly in Europe, had been insisting that the Palestinians resume accepting the tax transfers from Israel before seeking further aid.
Israeli and Palestinian experts also said that Democrats seeking to facilitate a return to a peace process under Mr. Biden have urged the Palestinians to take specific steps to show that they will not be obstructionist if the new administration engages on the Israeli-Palestinian conflict. Those include resuming security cooperation and taking the tax transfers, as well as one move that could encounter considerable opposition among the Palestinian public: reforming the way that Palestinians who serve time in Israeli prisons, including for violent attacks, are financially compensated, an arrangement that critics call “pay to slay.”
Diana Buttu, a former adviser to the Palestinian negotiations team who is now often critical of Mr. Abbas, said that some officials in Ramallah had argued to “take a pause” before resuming cooperation with Israel, reasoning that “returning to the status quo ante is what brought us the status quo.”
But she said that Mr. Abbas and his aides had chosen instead to usher in the Biden era by reinstating ties to the United States, inviting a renewal of peace talks with Israel and resuming bilateral cooperation, in hopes of getting the new administration to reverse as many of Mr. Trump’s moves as possible.
“Their whole response to the Trump administration has been to say, ‘Hello, we’re still here,’” Ms. Buttu said. “But it’s not going to lead to a change in anything. It actually gives Israel a little bit of a pass. Particularly now when you see the latest settlement announcement, and Pompeo’s visit — it’s as though they’re rewarding Israel.”
The Palestinians came close to restoring ties with Israel in August, when annexation appeared to stall because of internal opposition in Israel. But they held off in response to the normalization agreements with Arab countries, European diplomats and Palestinian officials said. Mr. Abbas did not want to be seen as benefiting from accords that he so adamantly opposed.
In the months since, Mr. Abbas has sought to create political leverage for himself by floating the idea of calling new elections — he was elected in 2005 to what was to have been a four-year term — and by renewing talks over an elusive reconciliation agreement with Hamas, the militant group that rules the Gaza Strip, and which favors a more confrontational approach toward Israel in the West Bank.
Hamas blasted the Palestinian Authority for its decision on Tuesday, calling it “a stab in the back of efforts toward building a national partnership.”
The resumption of coordination was announced on Twitter by Hussein al-Sheikh, a Palestinian Authority minister who oversees relations with Israel and is one of Mr. Abbas’s closest advisers. Saying that Israel had reconfirmed its commitment to prior agreements with the Palestinians, he wrote, “the relationship with #Israel will return to how it was.”
In an interview, he also expressed hope that relations with Washington would “return to how they were previously,” and said that he believed the authority’s decision would make it easier for Mr. Biden’s White House, along with the international community, to try to advance “the political process between us and the Israelis.”
But Michael Milshtein, a former senior Israeli military officer with extensive experience dealing with the Palestinians, said there was another reason for Mr. Abbas to go back to cooperating with Israel and let the money flow again.
“The Palestinians needed to find a way to save face,” he said. “The U.S. elections provided them with that.”
Michael Crowley contributed reporting from Washington.