Search JTA's historical archive dating back to 1923

Arab Bank Okayed for West Bank

June 18, 1985
See Original Daily Bulletin From This Date

A series of economic liberalization measures in the West Bank will be capped by the establishment of the first Arab bank in the territory, the head of the civil administration. Col. Freddie Zachs, told reporters today.

He said the government and the Bank of Israel recently gave final approval to the project initiated by a prominent Nablus businessman, Zafer Al-Masri. It is aimed at improving the quality of life in the administered territories where the vast majority of the inhabitants are Palestinians. Until now, only Israeli banks were allowed to operate, with the exception of a minor bank, Falastin, in the Gaza Strip.

Zachs said the only remaining obstacle is posed by the Jordanian authorities. The Arab bank will of necessity have strong ties with Jordan because the principal currency used in the West Bank is the Jordanian Dinar. But Amman objects to Israel’s insistence that it must operate under the supervision of the Bank of Israel, the country’s central bank, which supervises all financial institutions.

Zach predicted that once the Arab bank opens in Nablus, West Bank residents will deposit millions of Dinars they have been hoarding in their homes, thereby stimulating the territory’s lagging economy.

Another recent liberalization measure was the lifting on May I of restrictions on the import of foreign currency into the territories. In the past the amounts of currency brought in were strictly limited because the Israeli authorities feared it would find its way into enemy hands. But during the current fiscal year, which began October 1, about $50 million were brought in, helping to shore up Israel’s dwindling foreign currency reserves.

According to the annual report of the civil administration, published today, the population of the West Bank stood at 787,000 at the end of 1984, an increase of 20,000 over the previous year. About 40,000 are Jewish settlers living in about 100 settlements all over the territory.

Recommended from JTA