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A distinct national currency system and a postal department are each traditional symbols of an autonomous and hopefully well-recognized independent government.

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Land for this new independent Palestinian state would come primarily from Israel, should this become a reality. Israel, of course, is against establishing such an independent Palestinian state.

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The United States is caught in the middle politically since on one hand the US wants to encourage democratic governments in countries involved in the Arab Spring revolutions, but also wanting to support its traditional ally Israel. Postcard sent on Christmas from Bethlehem to Jerusalem.

A postal authority is one thing, but establishing a currency system that will actually function is something else. Keeping it simple, it takes money.

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Israel is threatening to withhold all tax revenues from the Palestinian Authority if the authority presses the UN for acknowledging Palestine as an independent state. Without this tax revenue income Palestine would have to turn to other countries, likely Arab nations, for funding for backing for any independent currency system of its own.

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An additional challenge for an independent Palestine wanting to establish its own currency would be the Oslo agreements of Through this agreement Israel and the Palestinian National Authority agreed a new Palestine would not issue its own legal tender coins or bank notes. The Israeli sheqel, Jordanian dinar, US dollar, and a mix of Gulf state currencies circulate in Palestine for that reason.


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