West Bank Country Summary
Sanctions
US and Israel have issued guidelines re transactions with Palestine
FATF AML Deficient List
No but Mutual Evaluation not yet undertaken
Terrorism
Corruption
US State ML Assessment
Criminal Markets (GI Index)
EU Tax Blacklist
Offshore Finance Center
Please note that although the below Summary will give a general outline of the AML risks associated with the jurisdiction, if you are a Regulated entity then you may need to demonstrate that your Jurisdictional AML risk assessment has included a full assessment of the risk elements that have been identified as underpinning overall Country AML risk. To satisfy these requirements, we would recommend that you use our Subscription area.
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Anti Money Laundering
FATF status
The West Bank/Gaza Strip is not on the FATF List of Countries that have been identified as having strategic AML deficiencies
Compliance with FATF Recommendations
A Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards has not yet been undertaken for the West Bank/Gaza Strip.
Sanctions
The US has established guidelines for transactions with the Palestinian Authority, while Israel enforces restrictions on movement and goods within Palestinian territories. The Arab League has imposed sanctions on Syria, including cutting off transactions with its central bank and halting funding for projects, alongside a travel ban for senior officials.
Additionally, the Arab League has implemented a systematic boycott of Israel to support the Palestinians, which varies in enforcement among member states. This boycott consists of three tiers, including prohibiting the importation of Israeli goods, restricting business with entities that engage with Israel, and preventing dealings with companies linked to the Arab League blacklist.
Bribery & Corruption
| Rating | 0 (bad) - 100 (good) |
|---|---|
| Transparency International Corruption Index | NA |
| World Bank: Control of Corruption Percentile Rank | 26 |
A September 2022 poll indicates that the Palestinian public perceives favoritism and nepotism as the primary forms of corruption, particularly within government institutions. While the Anti-Graft Law of 2005 aims to combat corruption and has led to the establishment of an anti-corruption court and commission, the belief that access to power is essential for business success remains widespread. Despite low reported instances of bribery compared to neighboring countries, civil society organizations like the Coalition for Integrity and Accountability actively promote anti-corruption efforts.
Economy
The Palestinian economy in the West Bank is characterized by a nominal GDP of just over $19 billion in 2022, but it has faced significant challenges, particularly following the events of October 7, 2023, which led to a sharp economic downturn. The economy is heavily reliant on Israel for trade, with approximately 90% of exports directed there, resulting in a substantial trade deficit of $6.2 billion in 2023. Despite a well-educated labor force, high unemployment rates persist, reaching 29% in the West Bank and 74% in Gaza by the end of 2023, exacerbated by restrictions on movement and access.
The investment climate in the West Bank is severely constrained by ongoing political and economic instability, particularly following the events of October 7, 2023, which led to increased restrictions on movement and a significant downturn in economic activity. Foreign direct investment remains low, accounting for only 1% of GDP, and is primarily directed towards non-trade activities due to high transaction costs and regulatory challenges. Despite some improvements in the legal framework for business, such as the updated Companies Law, the overall environment for investment is hampered by limited competition, high unemployment rates, and reliance on Israeli markets for exports.
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- Risk Analysis
- Corruption
- Economy
- Sanctions
- Narcotics
- Executive Summaries
- Investment Climates
- FATF Status
- Compliance
- Key Findings
