FALCON POWERS – According to a spokesperson for the Israeli Finance Minister, the Minister has extended a grace period that allows cooperation between the Israeli banking system and Palestinian banks in the West Bank.
The grace period, which was originally set to expire at the end of June, enables Israeli banks to handle payments in the Israeli shekel for services and salaries related to the Palestinian Authority. Without this extension, the Palestinian economy would have suffered a major blow.
The spokesperson, Betzalel Smotrich, stated that the Minister extended the exemption during a recent Cabinet meeting. US Treasury Secretary Janet Yellen had previously said it is important to maintain the reciprocal banking relationships between Israel and the Palestinians in order to keep the struggling economies in the West Bank and Gaza functioning, and to help maintain security.
The Palestinian economy is heavily dependent on this banking relationship to conduct transactions denominated in shekels. Official data shows that around 53 billion shekels ($14 billion) were traded in Palestinian banks in 2023.
