Abu Libdeh told Voice of Palestine radio that Israeli threats are "a hostile act.” He added that "Israel is declaring war by such threats."

On Tuesday, Israeli Vice Prime Minister Silvan Shalom threatened to impose sanctions on the PA over its campaign to clear the Palestinian markets of settlement products, stressing "if the boycott continues, the government will have to make the right decision."

Abu Libdeh stressed that it is a Palestinian right to boycott the products of the "illegal settlements that were built on Palestinian-owned lands occupied in 1967."

He also affirmed that the Palestinian campaign, From House to House, "will go on and will achieve the desired results," adding that the Israeli threats "will not affect it."

"The PA did not violate the international law or ignore the peace process when it decided to boycott goods produced in Israeli settlements," he said.

The PA launched its campaign to encourage Palestinians in the West Bank to boycott about 500 items produced and made in Israeli settlements, which the Palestinians see as illegal and obstacle to peacemaking.

The new law backing the boycott states that anyone who deals in products produced in settlements will be imprisoned for two to five years and pay a fine of up to $14,000. Those who import settlement products into the Palestinian territories are threatened with three to six years, fines of up to $3,000, and the confiscation of their licenses and vehicles.

According to official statistics, the Palestinian markets annually consume $200 million of products made in the West Bank and Jerusalem settlements.

Israeli media reported this month that around 17 Israeli factories have shut down since the PA's move.

The Palestinian Minister of Social Affairs Majedah Al-Masri on Sunday said that the PA began the practical steps to absorb 6,000 Palestinians working in Jewish settlements in the West Bank.

Al-Masri said in a press statement that the PA will create jobs for 6,000 of 25,000 Palestinians who now work in the settlements. She called on Palestinian workers, and mainly female ones, to fill a form her ministry prepared for this purpose.