The committee urged the Palestinian authorities to "immediately start preparing plans and projects aimed at severing ties with the Israeli authorities at the level of politics, governance, economy and security," the statement read.
Moreover, the PLO Executive Committee decided to "refer to the UN Security Council, General Assembly and the International Criminal Court [ICC], asking them to refuse to recognize the state of Israel until it renounces the recognition of Jerusalem as its capital."
The statement comes ahead of a reported meeting between Israeli Finance Minister Moshe Kahlon and Palestinian Prime Minister Rami Hamdallah next week.
On December 6, US President Donald Trump announced his decision to recognize Jerusalem as Israel's capital and instructed the US State Department to launch the process of moving the US Embassy, currently located in Tel Aviv, to Jerusalem. The step has prompted criticism from a number of states and triggered a wave of protests in the region.