The Palestine pound, also was the currency of the British Mandate of Palestine from 1 November 1927 to 14 May 1948, and of the State of Israel between 15 May 1948, and 23 June 1952, when it was replaced with the Israeli lira. The Palestine pound was also the currency of Transjordan until 1949 when it was replaced by the Jordanian dinar, and remained in usage in the West Bank of Jordan until 1950. In the Gaza Strip, the Palestine pound continued to circulate until April 1951, when it was replaced by the Egyptian pound. The Palestine pound was divided into 1000 mils or prutot. Today, the currencies in use in the Palestinian territories are the Israeli new shekel and the Jordanian dinar.
History
Until 1918, Palestine was an integral part of the Ottoman Empire and therefore used its currency, the Ottoman lira. During 1917 and 1918, Palestine was occupied by the British army, who set up a military administration. The official currency was the Egyptian pound, which had been first introduced into Egypt in 1834, but several other currencies were legal tender at fixed exchange rates that were vigorously enforced. After the establishment of a civil administration in 1921, the High CommissionerHerbert Samuel ordered that from 22 January 1921 only Egyptian currency and the British gold sovereign would be legal tender. In 1926, the British Secretary of State for the Colonies appointed a Palestine Currency Board to introduce a local currency. It was based in London and chaired by Mr. P.G. Ezechiel, with a Currency Officer resident in Palestine. The board decided that the new currency would be called the Palestine pound, fixed in value to the British pound and divided into 1000 mils. The one pound gold coin would contain 123.27447 grains of standard gold. The enabling legislation was the Palestine Currency Order, 1927, signed by the King in February 1927. The Palestine pound became legal tender on 1 November 1927. The Egyptian pound and the British gold sovereign remained legal tender until 1 March 1928. The Palestine Currency Order explicitly excluded Transjordan from its application, but the Government of Transjordan decided to adopt the Palestine pound at the same time as Palestine did. The Egyptian pound remained legal tender in Transjordan until 1930. All the denominations were trilingual in Arabic, English and Hebrew. The Hebrew inscription includes the initials Alef Yud after "Palestina", for "Eretz Yisrael". The Currency Board was dissolved in May 1948, with the end of the British Mandate, but the Palestinian pound continued in circulation for transitional periods:
In the West Bank, the Palestine pound continued to circulate until 1950, when the West Bank was annexed by Jordan, and the Jordanian dinar became legal tender there. The Jordanian dinar is still legal tender in the West Bank along with the Israeli shekel.
In the Gaza Strip, the Palestine pound continued to circulate until April 1951, when it was replaced by the Egyptian pound, three years after the Egyptian army took control of the territory.
The Oslo Accords provided that the Palestinian Authority will not issue its own currency and will use the Israeli or Jordanian currencies. Today, the Israeli new shekel and Jordanian dinar are the currencies in use in the Palestinian territories. The shekel is the main currency used in Gaza and the primary currency for retail transactions in the West Bank. The dinar is used in the West Bank for savings and durable goods transactions. The United States dollar is also sometimes used for savings and for purchasing foreign goods. The Palestinian Authority can issue postage stamps and these are valued in terms of the Palestine pound, which Palestinian economists and officials regard to be a still-existent currency, to be revived after Palestinian independence. In practice, prices in the Palestinian territories are quoted in Israeli currency. The Palestinian Authority and Palestine Monetary Authority were considering issuing new banknotes and coins in 2010 and 2011 as part of a broader push by Prime Minister Salam Fayyad to make Palestine a viable independent state. The PA and Palestinian Monetary Authority abandoned the idea of an independent Palestine pound in 2011.
Coins
In 1927, coins were introduced in denominations of 1, 2, 5, 10, 20, 50 and 100 mils. The 1 and 2 mils were struck in bronze, whilst the 5, 10 and 20 mils were holed, cupro-nickel coins, except for during World War II, when they were also minted in bronze. The coin of 10 mils was also called a grush. The 50 and 100 mils coins were struck in.720 silver. The last coins were issued for circulation in 1946, with all 1947 dated coins being melted down.
Banknotes
On 1 November 1927, banknotes were introduced by the Palestine Currency Board in denominations of 500 mils, 1, 5, 10, 50 and 100 pounds. Notes were issued with dates as late as 15 August 1945. The 100 pound note was equivalent to 40 months’ wages of a skilled worker in Palestine. Currently six of them are unaccounted for and four are known to exist in the hand of collectors. Their serial numbers and dates are:
