Israel’s Smotrich could paralyse Palestinian economy by ending bank waiver
Bank of Palestine Head Office, Ramallah
Al Jazeera reports on 11 Jun 2025:
Israel’s far-right finance minister, Bezalel Smotrich, has cancelled a waiver that Palestinian banks rely on to operate hours after five Western governments announced he faced sanctions, along with fellow ultra-nationalist Minister Itamar Ben-Gvir, for inciting violence against Palestinians in the occupied West Bank.
Warnings have previously been raised that Israel’s ending of the waiver could have devastating consequences for the Palestinian economy, which is dependent on the Israeli banking system as the Palestinian Authority (PA) does not have its own central bank or currency.
“Finance Minister Bezalel Smotrich has instructed Accountant General CPA Yali Rothenberg to cancel the indemnity provided to correspondent banks dealing with banks operating in Palestinian Authority territories,” Smotrich’s office said in a statement on Tuesday, announcing the changes.
The statement also directly linked Smotrich’s decision to the PA’s international advocacy against the establishment of illegal settlements in the occupied territories, which the minister’s office described as the “delegitimisation campaign against the State of Israel internationally”.
Smotrich’s decision to end the waiver came hours after Australia, Canada, New Zealand, Norway and the United Kingdom announced sanctions against him, as well as against Israeli National Security Minister Itamar Ben-Gvir for their “incitement of violence” against Palestinians.