Israeli banks sever relations with banks in the Gaza Strip

Date: 30 / 09 / 2007 Time: 13:26

Bethlehem – Ma'an –

The administration of the Israeli Discount Bank has decided to follow suit with the Hapoalim Bank, which ceased all financial dealings with banks in the Gaza Strip.

The decision of the Hapoalim Bank was made following the Israeli security cabinet's designation of the Gaza Strip as an 'enemy entity', and its decision to cease the supply of services in the area.

Israeli economists have commented that Israeli banks must withdraw from dealings with banks in Gaza in order to avoid a contravention of Israeli law.

When the Discount Bank cuts all relations with banks in Gaza, all financial bonds will be halted, including the stock exchange. This will mark a new financial era for the Gaza Strip.

Israeli daily Yedioth Ahronoth reported that the government has not yet ordered Israeli banks to sever ties with Gazan banks, but that the move was expected following the designation of Gaza as an 'enemy entity'.

An Israeli journalist, who spoke on condition of anonymity, commented on the decision, saying that Israeli banks were more serious than the Israeli security cabinet in the designation of Gaza as an 'enemy entity'.

The journalist expressed astonishment at the weak Arab and Palestinian reaction to the decision, saying that "if Israeli banks end their financial dealings with banks in Gaza, the Israeli shekel will disappear from the strip, causing a serious crisis in the local market. The Israeli shekel will be sold on the black market and may reach exceptionally high prices."

The Palestinian stock exchange announced that it will investigate the matter and begin consultations with Israelis to guarantee the security of bank performance in the Palestinian territories.

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