During the meeting, the EU and the European Investment Bank (EIB), together with the Palestine Monetary Authority, signed a EUR 28.3 million agreement under the Palestine Financial Sustainability Initiative. This funding, including a EUR 16 million EU guarantee facility and EUR 12.3 million EU grant, aims to enhance access to finance for Palestinian micro, small, and medium enterprises (MSMEs), focusing on Area C, East Jerusalem, and Gaza (when conditions permit).

This initiative underscores the EU and EIB's commitment to support the Palestinian Authority in stabilizing the Palestinian economy amid the current dire context, in line with the reform agenda of the Palestinian government. The Palestinian private sector, in the West Bank, East Jerusalem and Gaza, will directly benefit from this initiative. It will also contribute to the recovery and growth of the Palestinian economy while confirming the EU’s engagement in support Gaza reconstruction and Gazan economy, once feasible.  

The EU-Palestine Investment Platform serves as a collaborative mechanism to identify and promote investment opportunities, leveraging the EU External Investment Plan and mobilizing public and private financing for Palestine’s development priorities. In this context, the European Union, its Member states and European Financial Institutions have contributed approximately EUR 1.15 billion in ongoing loans and innovative financial instruments to vital sectors of the Palestinian economy.

 “In these difficult political and economic times, the EU reaffirms its strong commitment to support the Palestinian Authority and people in achieving economic recovery and stabilization. The Palestine Financial Sustainability Initiative is a concrete step towards empowering the Palestinian private sector and creating opportunities for economic recovery across the occupied Palestinian territory, particularly while Gaza continues to face a dire humanitarian and economic situation. However, sustainable economic development cannot be fully realised without a political solution,” said EU Representative Alexandre Stutzmann. “The EU remains steadfast in its support for the two-state solution with an independent, viable, and sovereign Palestinian state living side by side in peace and security with Israel. Economic progress and political resolution go hand in hand, and today’s investment is a testament to our belief that fostering stability and growth is an essential part of this vision.”

Background:

European Union – Palestine Investment Platform

The European Union – Palestine Investment Platform (Platform), a collaborative initiative between the EU and Palestine, was established with the aim of fostering policy dialogue and investment. It serves as a platform to identify, prioritise, coordinate and promote investment opportunities offered by the EU External Investment Plan, together with its European Fund for Sustainable Development (EFSD). A key objective of the Platform is to better attract investments into Palestine by mobilising additional public, institutional and private financing, contributing to Palestine’s policy and reform priorities.

Since launching the Platform in December 2020, six high-level meetings took place under the auspices of the Palestinian Prime Minister and the European Union Representative.

Palestine Financial Sustainability Initiative

The “Palestine Financial Sustainability Initiative” -backed by a €28 million grant from the EU's Neighbourhood Investment Platform- will be used to complement EIB lines of credit, by providing partial portfolio guarantees, investment grants, and technical assistance.