The EU has urged Israel to abandon Finance Minister, Bezalel Smotrich’s plan to revoke a waiver that enables Israeli banks to work with Palestinian counterparts.
EU spokesman Anouar El Anouni said that the bloc is deeply concerned by Smotrich’s instruction to cancel the waiver on cooperation with Palestinian banks, “which could cut them off from the Israeli financial system, devastate an already crippled Palestinian economy, and may lead to the collapse of the Palestinian Authority.” He added, “The EU calls on Israel to revert this decision immediately and to refrain from any action that could lead to the collapse of the Palestinian Authority.”
Smotrich’s move to cancel a waiver that Palestinian banks rely on to operate hours after Australia, Canada, New Zealand, Norway and the United Kingdom announced sanctions on him and fellow ultra-nationalist Minister Itamar Ben-Gvir, for inciting violence against Palestinians in the occupied West Bank.
Smotrich’s office said in a statement announcing the changes, “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.”
The statement also directly linked Smotrich’s decision to the Palestinian Authority’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.”
The end of the waiver could have a devastating impact on the finances of Palestinians, particularly in the occupied West Bank, which has already suffered multiple economic blows over the past two years.
The overwhelming majority of exchanges in the West Bank and Gaza are in shekels, Israel’s national currency, because Palestine is not allowed to have its own central bank or print its own currency, which means that Palestinian banks are reliant on Israeli banks to operate.
Israeli banks only continue to work with the Palestinian banks because of the government waiver, which protects them from potential legal action relating to transactions with their Palestinian counterparts.
Israeli Prime Minister, Benjamin Netanyahu’s government has repeatedly threatened to end the waiver in the past, prompting rebukes from even Israel’s closest allies.
Smotrich and Ben-Gvir openly support illegal settlements and the expulsion of Palestinians from their territory.
Israel denounced the sanctions against them as “outrageous”, while the US also condemned the move.
Albanese Defends Sanctions On Far-right Israeli Ministers
Meanwhile, Australian Prime Minister, Anthony Albanese in an interview, defended the sanctions, calling the reactions from Israel and the US “predictable.”
“The Israeli government does need to uphold its obligations under international law, and some of the expansionist rhetoric that we’ve seen as well is clearly in contradiction of that from these hardline right-wing members of the Netanyahu government.
“We, along with those other countries and the broader international community, believe we can only see peace in the Middle East when we deal with two states and when both Israelis and Palestinians can live in peace and security.”
Anthony Albanese
Separately, Franziska Brantner, the Head of Germany’s Green Party, called for Berlin to join other countries in sanctioning Israeli far-right ministers Bezalel Smotrich and Itamar Ben-Gvir for inciting violence against Palestinians and open support of illegal settlements and the expulsion of Palestinians from their territory.
Brantner, who co-leads Germany’s second-largest opposition party, accused the two Ministers of “openly calling for violence against the Palestinian population and long having propagated a policy of annexation and displacement.” He added, “This costs human lives, displaces entire communities and poses enormous hurdles on the path to a peace process.”
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