Israel has reportedly granted a two-week extension to an indemnity waiver allowing Israeli banks to conduct transactions with Palestinian ones.
The waiver was set to expire yesterday, in what risked collapsing the Palestinian economy in the West Bank, given that the Oslo Accords, signed in the 1990s, require it to run on the Israeli shekel. The extension was reported by several Palestinian news sites.
Finance Minister Bezalel Smotrich had been refusing to sign the waiver as part of his efforts to undermine the West Bank-based Palestinian Authority.
Prime Minister Benjamin Netanyahu sought to strip Smotrich of his authority on the issue last month, but the far-right minister threatened to collapse the government, leading the premier to back off, an Israeli official told The Times of Israel.
The two-week extension is a temporary solution, as Netanyahu seeks to address this issue, which has sparked alarm in the Trump administration, a US official said.
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