Amidst the ongoing Gaza war, Israel’s Foreign Minister Gideon Sa’ar recently presented a surprising initiative. By replacing the 200-shekel banknotes—either all notes or specific series—the financial backbone of Hamas could be significantly hit. The idea is to replace old notes with new ones, perhaps with a changed color scheme, with the exchange only possible in Israeli banks. For Hamas, isolated from the Israeli banking system, this would be a severe blow. In the Gaza Strip, cash is king.
However, the Bank of Israel reacted cautiously. They currently see no reason to withdraw or replace banknotes, stating that such initiatives have not yet provided a professionally sound justification for such drastic steps. Yet, a closer look at the situation in Gaza reveals why this proposal could indeed have an impact.
The worsening financial situation in Gaza
Since the war began, the already fragile financial situation in the Gaza Strip has dramatically worsened. An acute shortage of cash dominates daily life. Digital transfers—such as donations from abroad or salary payments from...
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National Banks, such as the Bank of England, operate purely in their own interest. Ignore them.