Palestine may replace Israeli currency to reduce dependency

A Palestinian boy sells fresh mint in downtown Gaza City. Palestinians have long demanded scrapping of the Israeli currency. (AFP/file)
Updated 18 February 2018
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Palestine may replace Israeli currency to reduce dependency

AMMAN: The Palestinian government has decided to begin reducing dependency on Israeli currency. Prime Minister Rami Hamdallah’s government decided on Feb. 6 to establish a committee to study “ways to shift from the use of the Israeli shekel to other currencies as well as studying the issuance of a national currency.”
Palestinians have been trying to find ways to wean themselves away from total dependency on Israel’s economy for a long time. Scrapping the Israeli currency, which is used throughout the occupied territories, has long been a demand of non-violent Palestinian activists.
Alex Awad, author of “Palestinian Memories: The Story of a Palestinian Mother and Her People,” explained the thinking behind the demand to shift away from using shekels as the primary currency for Palestinians.
“Why do we accept bills that have images of Israeli leaders on them? Why, with all of the evil measures against us, making our lives miserable, do we continue to use the currency of the very government that oppresses us? When are we going to end our addiction to their rules?” he said.
But Palestinian economists warn that the move could be disastrous for the local economy.
A retired senior monetary official told Arab News that until Palestinians are truly free and independent, there are no easy solutions to the currency issue. “When you tamper with currency you are risking a major economic problem for people,” he said.
The source, who asked not to be identified, noted that many Palestinians work in Israel. And, he added, the Paris agreement that regulates the Palestinian government’s tax and customs revenue specifies that Israeli shekels must be used in all economic dealings with Israel.
While it is easy to make some changes in the use of other currencies such as the US dollar or the Jordanian dinar, it is impossible to totally abandon the Israeli currency, the source said.
Samir Abdullah, a senior researcher at the Economic Policy Research Institute (EPRI) in Ramallah, told Arab News that it is possible to lessen dependence on the Israeli currency but that doing so would only affect a small portion of overall revenue.
“The biggest problem (is) the 7 billion shekels ($2 billion) in tax and custom revenues that come through Israel, which constitutes about 70 percent of overall revenue for the Palestinian government.”
Majed Arouri, executive director of the Civil Commission for the Independence of the Judiciary and Rule of Law, told Arab News that the Palestinian government’s decision was unwise and hasty.
“The Israeli government has been working on withdrawing the Jordanian dinar and US dollar from the Palestinian economy and has limited the availability of dinars,” Arouri said.
“The only dollar bill available in Palestine these days is the 100-dollar bill, which makes it difficult to conduct small-business dealings,” he added. Awad told Arab News that he sees the government’s decision as a small step toward Palestinian economic independence.
“This is a small act, but it is something everyone can do and it allows people to feel that they are not helping the occupiers,” he said.
Awad added that until Palestinians have their own currency, it is important to decrease their dependency on Israeli money.
“A large percentage of the currency coming to Palestine is in dollars, euros or Jordanian dinars,” he said. “Why are people so quick to change it into Israeli shekels?”
One possible solution to the dilemma that is being discussed by economists and activists is electronic banking and financial transfers.
A strong banking system and a tech-savvy population in Palestine would certainly mean that currencies other than the Israeli shekel could easily be used more often.
The EPRI’s told Arab News that one way to help lessen dependence on the shekel is to use credit cards.
“If we increase the use of credit cards, and at the same time work on a major expansion of points of sale that use these cards, we can use different currencies from the Israeli shekel,” he said.
Totally divorcing Palestinians from dependence on the Israeli economy and currency will be difficult, and the independent path that is being sought requires intense evaluation. But one thing is certain: The role of currency in a future Palestinian state is crucial.


In Iraq, Angelina Jolie calls for focus on conflict prevention

Updated 20 min 34 sec ago
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In Iraq, Angelina Jolie calls for focus on conflict prevention

  • “I hope that we can find the strength to find a better way forward together," she said
  • This was Jolie’s third visit to the camp as UNHCR special envoy

IRBIL: Hollywood star Angelina Jolie called Sunday for a larger focus on conflict prevention rather than responding to its repercussions, during a visit to Iraq with the UN refugee agency.
“I hope that we can find the strength to find a better way forward together: so that we move into a new era of preventing conflict and reducing instability, rather than simply struggling to deal with its consequences,” Jolie told a news conference at the Domiz refugee camp in Iraq’s autonomous Kurdistan region.
It was Jolie’s third visit to the camp as UNHCR special envoy, after previous visits in 2012 and 2016.
The Domiz camp opened in 2011 and is home to 40,000 Syrian refugees who fled the seven-year civil war across the border.
“When UNHCR’s Syria response was only 50 percent funded last year, and this year it is only 17 percent funded, there are terrible human consequences,” Jolie said.
“We should be under no illusion about this,” she added.
Late last month, the UN made an “urgent and critical” appeal for donations to its main budget for Syrian refugees after contributions pledged in April failed to trickle in.
“When there is not even the bare minimum of aid, refugee families cannot receive adequate medical treatment, women and girls are left vulnerable to sexual violence, many children cannot go to school, and we squander the opportunity of being able to invest in refugees so that they can acquire new skills and support their families,” she said.
Her visit coincided with the third day of Eid Al-Fitr celebrations marking the end of the Muslim holy month of Ramadan.
On Saturday, Jolie visited western Mosul, held by Daesh terrorists for nearly three years until they were pushed out by Iraqi forces last summer.
During her visit, she walked through Mosul’s destroyed Old City, met with displaced families and spoke about reconstruction.
“This is the worst devastation I have seen in all my years with UNHCR,” Jolie said.
“It is deeply upsetting that people who have endured unparallelled brutality have so little as they try, somehow, to rebuild the lives they once had.”
The visit marked Jolie’s 61st mission — and fifth to Iraq — with the UN refugee agency since 2001.