Abbas warns of 'explosion of anger'

Israel's Bank Discount decides to sever ties with Palestinian lenders.

May 16, 2006 16:25
2 minute read.
abbas at EU parl 298 ap

abbas at EU parl 298 ap. (photo credit: AP)


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"Life will be frozen and then there will be an explosion of anger and this would lead to a chaotic situation of which we cannot foresee the results," Palestinian Authority Chairman Mahmoud Abbas warned at a news conference after a speech to the European Parliament in the French city of Strasbourg. Abbas appealed to the EU to give the Hamas-led government a "chance to adapt" to international requirements. EU foreign ministers on Monday said they were moving swiftly ahead with plans to get financial aid to the Palestinians without it reaching the Hamas government. External Relations Commissioner Benita Ferrero-Waldner said a temporary trust fund to handle the money could be set up as early as June. Abbas said he hoped to start a "national dialogue" in the next few days that could lead the Hamas government "to amend its platform" and conform with commitments to the peace process made by the previous Palestinian administration. In yet another blow to the Hamas-led government, Israel's Discount Bank on Tuesday said it was severing ties with banks operating in Palestinian areas. The decision will make it much more difficult for Palestinians, both the government and private business people, to continue their substantial financial dealings with Israeli businesses. Only two Israeli banks are authorized to handle such transactions. With Tuesday's announcement, both banks are now set to cut ties. Bank Discount officials said are worried they could run afoul of anti-terrorism laws if they continue dealing with the Hamas-led government. The US, European Union and Israel have branded Hamas, which is sworn to Israel's destruction, a terrorist group. In a statement, Bank Discount said all deal dealings with Palestinian banks would be halted in the next three to six months. It said the decision was made after discussions with the Israeli Finance Ministry and central bank. "No suitable framework was found which would enable Bank Discount to provide banking services to the Palestinian banks without it being exposed to the significant risks involved in such activities," the bank said. Bank Hapoalim, the largest Israeli bank, said last month that it planned to sever ties with Palestinian banks as well. Under interim peace accords in the mid-1990s, Discount and Hapoalim are the only two Israeli banks authorized to deal with Palestinian banks. The Israeli institutions facilitate the Palestinians' significant financial dealings in Israel. The Palestinian government buys key supplies, such as fuel, electricity and water, from Israel, and numerous businesses buy goods from Israeli suppliers. The Palestinian government also pays its tens of thousands of employees in shekels, the Israeli currency.

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