RAMALLAH — The Palestinians will ask the UN General Assembly to recognise Palestine as an observer state, a top Palestinian official said on Sunday.

Saeb Erekat said the timing of the request will be decided next week by the Arab League, the Associated Press reported.

The Palestinians seek a state in the West Bank, Gaza and East Jerusalem, territories Israel occupied in 1967.

UN recognition is largely symbolic, since Israel continues to control these territories to varying degrees.

A nod from the world body would endorse the pre-1967 lines as the border of a future Palestinian state. Palestinians fear that border is being erased by Israeli settlement building, according to AP.

The General Assembly can recognise Palestine only as an observer. A bid to win full UN membership was derailed by insufficient Security Council support last year.

Meanwhile, the Palestinian prime minister’s office said Sunday that Saudi Arabia will give the Palestinian Authority $100 million to help alleviate a stinging budget crunch, Reuters reported.

News of the cash was welcomed by Palestinian officials in the Israeli-occupied West Bank, as salaries for public sector employees have yet to be paid in full this month and economic doldrums promised to mar the usually festive and spendthrift Ramadan holiday beginning next week.

The transfer, described by Palestinian officials as imminent, will only partially defray the authority’s some $300 million in expenditures this month.

But officials in Ramallah are seeking the support of yet more countries to patch a budget deficit projected at over $1 billion for 2012.

“This $100 million is important and significant because it’s coming from a leading Arab state, and this hopefully can be an example for other countries to follow,” Ghassan Khatib, a government spokesperson, told Reuters.

“We will remain in need of external funding. Whenever it is affected, then we will be in crisis,” he said.

Amid a downturn in productive sectors and with its economic and commercial prospects hamstrung by Israeli restrictions, the Palestinian Authority is deeply dependent on foreign aid to pay its bills.

Of a hoped-for $1.1 billion in donor funds in 2011, the authority in Ramallah received just under $750 million, according to Reuters.

Several factors coalesced last year to leave the Palestinians out of pocket: a global financial downturn, a freeze in Israeli-managed customs duty as West Bank officials sought unity with Islamist rivals in Gaza and an aid freeze by the US following Palestinians’ bid for statehood at the UN last fall.

But with Saudi Arabia’s aid offer, Palestinians may hope for an end to the shortfall in pledges by traditional Arab benefactors, wrought in part by attention to domestic unrest and spending during the Arab Spring last year.

“This generosity added to the track record of financial and political support by the [Saudi] kingdom,” Palestinian Prime Minister Salam Fayyad said in a statement on Sunday, Reuters reported.