Palestinian officials will not take part in a conference in Bahrain next month to encourage investment in the West Bank and Gaza Strip, senior ministers said on Monday.
The Palestinian Authority said the United States did not consult them before announcing the conference, expressing their frustration at the lack of communication.
Senior PA ministers said there would be no one from the body attending the meetings, citing US efforts to normalise Israeli actions in occupied territories.
"We do not think that any Palestinian will participate in such a conference" because of the United States' legitimisation of Israeli occupation, Dr Mustafa Barghouti, general secretary of the Palestinian National Initiative and a member of the Palestinian Legislative Council, told The National.
"We think that there's a very big manipulation by the United States," he said.
Social Development Minister Ahmed Majdalani confirmed to Reuters that there would be no Palestinian participation in the Manama conference.
"Any Palestinian who would take part would be nothing but a collaborator for the Americans and Israel," he said.
Palestinian billionaire Bashar Marsi said that he has been invited but would not attend “any event outside the Palestinian national consensus.”
“The idea of economic peace is an old idea that is now being asked differently, and as our people have previously rejected it, we reject it now,” he added in a statement on Facebook.
However, controversial Palestinian businessman Ashraf Jabari from Hebron told The National that he too had been invited and would be attending.
Mr Jabari has ties to the US administration and last year co-founded the Samaria Chamber of Commerce and Industry with Israeli and US backing. Mr Jabari has courted controversy over his close ties to Israelis and meeting with residents of illegal Israeli settlements. Last week, he hosted an iftar outside his home for settlement leaders, which drew criticism from Palestinians.
Issa Amro, head of Youth Against Settlements in Hebron, said Mr Jabari had “no respect” in Hebron or among the Palestinian public. He also questioned the decision to include Mr Jabari by White House special adviser Jared Kushner and US special representative for international negotiations Jason Greenblatt.
"Kushner and Greenblatt are dealing with these kind of people?" Mr Amro asked. "This is very bad."
Earlier on Monday, Prime Minister Mohammad Shtayyeh said PA had not been involved in discussions on the meeting.
"The Cabinet wasn't consulted about the reported workshop, neither over the content, nor the outcome, nor timing," Mr Shtayyeh said.
A prominent Palestinian businessman also said he would not attend the conference, saying he rejected the idea of "economic peace".
Bashar Masri, who founded Massar International and the high-tech Rawabi City, said in a post on Facebook, "We confirm our clear position: we will not deal with any event outside the Palestinian national consensus. We Palestinians are capable of advancing our economy away from external interventions."
The White House announced on Sunday night that it would hold the gathering in Bahrain to discuss large-scale investment in the Palestinian territories. It said the conference would not address the contentious political aspects of the Arab-Israeli conflict, such as final borders or the status of Jerusalem and right of return for Palestinian refugees.
The news has been met with a cool response from Ramallah. Nabil Abu Rudeineh, spokesman for Palestinian President Mahmoud Abbas, said "any plan without a political horizon will not lead to peace".
Secretary General of the Palestine Liberation Organisation, Saeb Erekat, also said officials had not been contacted by anyone ahead of the announcement. He said the peace plan and suggested proposals were not, in fact, a US plan but instead, “the Trump administration’s vision is being implemented on the ground with their decisions and positions on Jerusalem, settlements and refugees, among others”.
"We have not mandated any party to negotiate on our behalf."
He said attempts to use economic means to lead to a settlement of the conflict “will be rejected” and that “efforts to make the oppressor and the oppressed coexist are doomed to fail”.
Mr Erekat added that proposals should not be about “improving living conditions under occupation but about reaching Palestine’s full potential by ending the Israeli occupation”. He reiterated the “well known” official Palestinian position being “full implementation of the long overdue inalienable rights of the Palestinian people as per international law and UN resolutions, with an independent State of Palestine on the 1967 border, with East Jerusalem its capital and a just solution to all final status issues based on international law and the Arab Peace Initiative”.
The White House has been working on what US President Donald Trump called the "deal of the century" to solve the decades-long conflict.
Many believe that the long-delayed plan is already dead in the water, as the PA has severed ties with the US administration. Ramallah refuses to engage with the White House after it recognised Jerusalem as the capital of Israel and relocated the embassy from Tel Aviv – ending decades of US policy that the final status of the city would be agreed through peace talks.
Mr Trump closed the Palestinian diplomatic mission in Washington and stopped funding the UN agency that helps Palestinian refugees, slashing hundreds of millions of dollars in aid for projects in the West Bank and Gaza and for Palestinians displaced across the region, and cut funding to hospitals in Jerusalem that serve Palestinians.
In a joint statement with Bahrain, the White House said the coming workshop would give government, civil and business leaders a chance to gather support for economic initiatives that could be possible with a peace agreement.
The administration likely hopes that Arab countries will help bankroll economic incentives, such as infrastructure and industrial projects, to get Palestinians to buy into the plan.
Nur Arafeh, an analyst with Palestinian policy think tank Al Shabaka, said the Bahrain conference is in “line with the historical American approach to solving the so-called conflict… [by] promoting an economic peace approach”.
The Trump administration is building off a longstanding US policy assumption, she said, that “economic prosperity of Palestinians and joint economic projects between [Israel and Palestinians] would improve standards of living and thereby pave the way for peace”.
But this approach has not and will not work as in practice it hinders political development instead of “linear progress between economic development and peace”, Ms Arafeh said.
“You can’t detach the economy from the political and historical approach,” she said. The Trump administration’s focus on economy first “obscures the fact that the Palestinian economy is heavily shaped by Israel’s occupation and settler colonial enterprise”.