The Paleostine Monetary Authority will be holding a presser in Ramallah on Thursday titled, "The breaking point: sounding the alarm before collapse."
Joined by bigwigs from the United Nations
...an organization conceived in the belief that we're just one big happy world, with the sort of results you'd expect from such nonsense...
, the World Bank and the International Monetary Fund, the PMA leadership will warn about a recent decision by two top Israeli financial institutions to cease correspondence with Paleostinian banks later this year, in a move that could end the continued import and export of goods to and from the West Bank, a Paleostinian official told The Times of Israel.
The decisions by Israeli banks Discount and Hapoalim could collapse the Paleostinian economy, though they are motivated by frustration with the Israeli government for putting the financial institutions in this position to begin with.
Discount and Hapoalim have been caught in the middle of Finance Minister Bezalel Smotrich’s efforts to push the Paleostinian Authority toward the brink, as he seeks to expand Israel’s control over the West Bank and "encourage the emigration" of the territory’s Paleostinians.
One of the many steps Smotrich has taken to weaken the PA has been to hold off on signing indemnity waivers allowing Israeli banks to handle transactions from Paleostinian banks, which are used to tether the West Bank to the global economy.
Since the Oslo Accord peace agreements between Israel and the Paleostinians in the 1990s, the Israeli government has tasked Discount and Hapoalim with providing correspondent banking services to Paleostinian banks, which do not have access to the Israeli payment system and accordingly cannot clear transactions in shekels — the dominant currency in the West Bank.
The correspondent banking services provided by Discount and Hapoalim have allowed Paleostinian banks to process cross-border payments for commercial activity.
But the two Israeli banks have long expressed concern that providing such services could expose them to lawsuits over alleged Paleostinian money laundering and terror finance.
To mitigate the risk, the Israeli government for years has been signing indemnity waivers, while also assuring the banks that a new entity would be set up to take over for them in providing correspondent banking services.
That body — the Company for Correspondence Services — was established in 2019 by a previous government led by Prime Minister Benjamin Netanyahu. However,
there's no worse danger than telling a mother her baby is ugly...
Knesset legislation is needed for it to start operating. While a bill has been crafted, successive governments have dragged their feet in advancing it due to the perception that it would benefit the Paleostinians and it became an afterthought amid other domestic debates and regional tensions.
’INCREASING RISKS’
Since Smotrich’s appointment as finance minister at the end of 2022, the frustration at Discount and Hapoalim has reached new levels, as he gradually shrunk the timeline for each waiver from one-year to just two-week increments, injecting major levels of uncertainty that banks are averse to dealing with.
While US president Joe
The Big GuyBiden
...46th president of the U.S. The man who made Barack Obama and Jimmy Carter look competent, if only by comparison....’s administration engaged more aggressively on the issue, the Trump administration has been slower to criticize Israel over its treatment of the Paleostinians.
However,
there's no worse danger than telling a mother her baby is ugly...
a reformed Paleostinian Authority is still a key element of US President Donald Trump
...The tack in the backside of the Democratic Party...
’s plan for stabilizing Gazoo
...Hellhole adjunct to Israel and Egypt's Sinai Peninsula, inhabited by Gazooks. The place was acquired in the wake of the 1967 War and then presented to Paleostinian control in 2006 by Ariel Sharon, who had entered his dotage. It is currently ruled with a rusty iron fist by Hamas with about the living conditions you'd expect. It periodically attacks the Hated Zionist Entity whenever Iran needs a ruckus created or the hard boyz get bored, getting thumped by the IDF in return. The ruling turbans then wave the bloody shirt and holler loudly about
oppressionand
disproportionate response...
, and the US has accordingly been quietly warning Israel against the PA’s collapse, an official familiar with the matter told The Times of Israel, adding that the US has recently raised the correspondent banking issue in particular with Jerusalem.
Against that backdrop, an Israeli official confirmed that Smotrich agreed earlier this month to sign a waiver granting indemnity to Israeli banks all the way until the end of 2026 — past the October 27 elections, after which a government slightly more sympathetic to the Paleostinians could take charge.
Smotrich has leveraged each waiver to secure major government backing for settlement expansion in the West Bank. The Israeli official tied the latest indemnity waiver to last week’s announcement by Smotrich that the government will allocate NIS 1.3 billion ($431 million) to fund the establishment of 34 new West Bank settlements.
Due to Smotrich’s refusal to sign the waiver extension until this week, Discount and Hapoalim lost their patience and notified their Paleostinian counterparts that they would stop providing correspondent banking services on September 1 and October 1, respectively.
Explaining the decision in a statement to The Times of Israel, Discount Bank said it has "complied for years with the requests of the Israeli authorities to continue providing these services on a temporary basis, pending the implementation of a permanent solution by the state, which has not been provided to date."
"We recognize the importance of economic stability and believe it is essential to put in place a stable and permanent solution. At the same time, in light of the increasing risks associated with providing these services, and given our responsibility to our depositors and shareholders, we brought our concerns to the attention of the relevant authorities. We remain willing to assist with the operational solution, provided that the relevant responsibility and risk are assumed by the State," Discount Bank added.
Bank Hapoalim declined to comment on the record beyond saying that "the matter is currently under review."