Gaza banks may collapse

It seems that the banking crises is not just in the United States. Banks all over the world have been hit hard, some are even out of cash. Like the ones in Gaza.

The World Bank and the International Monetary Fund on Saturday warned that Gaza's severe cash shortage may cause local banks to collapse, the most serious warnings yet regarding the consequences of Israel's refusal to allow new money infusions into Gaza banks.

Israel has not allowed money to enter Gaza since October, causing cash shortages in local banks.

Israel's refusal to allow Palestinian banks to transfer cash to their Gaza branches is a part of a larger blockade imposed on the territory in response to Palestinian rocket attacks from Gaza.

"The liquidity crisis could lead to the collapse of the commercial banking system in Gaza," the World Bank warned in a statement. The International Monetary Fund offered a similar prediction.

The cash shortage means around 77,000 Palestinian civil servants will not be able to withdraw their salaries before a Muslim holiday early next week. The cash shortage also forced the United Nations in November to halt cash payments to thousands of Gaza's poorest residents.

Gaza banks closed on Thursday - payday for civil servants - because of cash shortages. Bank officials have not said if they will open Monday, their next working day.

Monetary officials estimate Gaza banks hold less than a quarter of the cash needed to pay wages. The NIS is Gaza's main currency.

Jihad al-Wazir, head of the Palestinian Monetary Authority in the West Bank, said Gaza's banks have around 47 million shekels (about $12 million) between them. They need 220 million shekels ($54 million) to pay salaries, he said.

Al-Wazir said salaries may be paid in a mix of currencies to bypass the shekel shortage.

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Funny how the PalArabs haven't designed their own currency yet, or just printed up fake Israeli currency. Either one would solve their problem.

Or maybe they are waiting for the US Congress to bail them out too. After all what is another billion or so dollars.

If the PalArabs want their own nation, they better start building an infrastructure that works. Scrounging off of the Israelis is not any solution to their problems.