Accra:The Governor of the Palestine Monetary Authority (PMA), Yahya Shunnar, emphasized the necessity for Gaza's reconstruction to be spearheaded by Palestinian institutions, leveraging the capabilities of the banking and private sectors to support recovery efforts and implement reconstruction projects.
According to Palestine News and Information Agency – WAFA, Shunnar highlighted the importance of maintaining unity within the banking sector and financial connectivity between the West Bank and Gaza Strip. This approach ensures resources are channeled toward Palestinian national priorities and needs.
Shunnar's remarks were made during a meeting of Arab governors with the President of the World Bank Group, Ajay Banga. The discussion focused on the economic and financial challenges facing Palestine, the requirements for recovery and reconstruction in Gaza, and the World Bank Group's role in providing necessary financing.
He noted that Palestinian banks are prepared to contribute to the reconstruction, pointing to their strong financial positions and a capital adequacy ratio exceeding 17%. Shunnar also underscored the banking sector's adherence to international standards on anti-money laundering and combating the financing of terrorism, as well as the continuation of credit provision during the crisis. The PMA has succeeded in fully automating payments in Gaza and transitioning them to digital channels.
To bolster banks' capacity for supporting reconstruction, Shunnar stressed the need for continuity in correspondent banking relationships and addressing restrictions on excess cash liquidity. This would enable necessary financing to flow and support economic activity.
He called for increased international financing and the development of instruments to meet the estimated $71 billion needed for recovery and reconstruction in Gaza, as projected by the World Bank and other international institutions.
Shunnar urged the World Bank Group to strengthen its role in leading international reconstruction efforts through its plan, aligning it with Palestinian national priorities, and ensuring Palestinian institutions lead implementation efforts. He also advocated for the continued financial and economic connectivity between the West Bank and Gaza.
Expressing appreciation for the World Bank Group's support through the Trust Fund for Gaza and the West Bank and the Palestinian Fund for Reconstruction and Development (PFRD), Shunnar called for greater utilization of these mechanisms. He suggested using instruments from the International Finance Corporation (IFC) and the Multilateral Investment Guarantee Agency (MIGA), such as guarantees, risk-sharing, and trade finance, to facilitate financing through Palestinian banks and enable private sector contributions to reconstruction projects.