The European Investment Bank (EIB) and the European Commission have signed a €400 million financing facility with the Palestine Monetary Authority to strengthen the resilience of the Palestinian private sector. Announced at the UN General Assembly in New York, the initiative will improve access to affordable financing for micro, small, and medium-sized enterprises (MSMEs) and mid-cap companies, which form the backbone of the Palestinian economy. The funds will be channelled through local banks and microfinance institutions, allowing businesses to access loans on favorable terms and supporting economic stability amid ongoing conflict.
This facility is part of the European Commission’s Multiannual and Comprehensive Programme for Palestinian Recovery and Resilience, which has a total budget of €1.6 billion for 2025–2027. The program includes €620 million in grants for the Palestinian Authority, €580 million for resilience and recovery projects in the West Bank and Gaza (when conditions permit), and the €400 million EIB facility guaranteed by the European Commission. The program is designed to boost recovery, job creation, and inclusive growth in Palestine.
EIB Group President Nadia Calviño emphasized that Palestine’s economic stability remains a priority for the European Union, reaffirming support for a sustainable peace based on the two-state solution. EU Commissioner for the Mediterranean Dubravka Šuica highlighted that the facility reflects the EU’s unwavering commitment to strengthening the Palestinian economy, improving access to finance, and creating jobs.
Since 1995, the EIB has invested around €1 billion in Palestine, including €120 million in risk-sharing instruments to support SMEs. Even during the conflict, the bank has provided vital financing, including $192 million to the Palestinian Monetary Authority, €40 million to Bank of Palestine, and €20 million for a wastewater treatment plant in Ramallah. These investments have aimed to sustain critical infrastructure and private sector development despite challenging conditions.
EIB Vice-President Gelsomina Vigliotti noted that limited access to financial services remains a major challenge for Palestinian businesses, particularly MSMEs. By strengthening local banks’ capacity to offer targeted loans, the new facility is expected to revitalize private sector activity and safeguard jobs. Palestine Monetary Authority Governor Yahya Jawdat Shunnar added that the partnership will empower local enterprises to withstand current pressures, sustain growth, and preserve employment, while reinforcing economic resilience and hope for the future.
