Bond Issue: a Major Achievement for Palestinian Government and PMA to Enhance Financial Stability

PMA Governor, Dr Jihad Al-Wazir, declared that the decision to issue bonds, approved by the Palestinian Cabinet in its last meeting, is a major achievement of the government and the PMA. For the first time since 1947, the bonds will bear the name of the State of Palestine. 

Al-Wazir stated that, in the first phase, three-year bonds worth $200 million will be issued solely to banks. The bond issue will stimulate the interbank market, thereby enhancing financial stability as well as the steadiness and stability of the interbank payment System (BURAQ). It will also foster better government management of the public debt.

Al-Wazir added that the decision has been taken in collaboration with the Ministry of Finance and in agreement with the banks, since it will restructure and securitize the outstanding sovereign debt to local banks. Al-Wazir emphasized that the bond issue will not increase government indebtedness or expose the government or the banking system to any additional risks, which is indicative of continuous development of the Palestinian government financial management. In the future, he added, the bond issue will act as a development tool of monetary policy, therefore promoting financial stability in Palestine.