GAZA, Dec 6 (Reuters) - The World Bank said on Saturday Israel's tightened blockade of Hamas-run Gaza had created cash shortages that could lead to the collapse of its banks. Bank branches across the Gaza Strip have been shut since Thursday for lack of sufficient money to operate normally. Israel has stiffened Gaza border closures in the past month as cross-border violence rose, choking off cash supplies. "The ongoing closure of Gaza and severe restrictions on the flow of goods and people continues to be a cause of grave concern," the World Bank said in a statement. A "serious cash shortage had been caused by Israeli restrictions on the transfer of banknotes into Gaza", the statement said. "The liquidity crisis could lead to the collapse of the commercial banking system in Gaza," it added, warning also that this could entail "serious humanitarian implications". Israel was urged "to move swiftly to restore cash liquidity in Gaza bank branches" before the three-day Muslim Eid al-Adha feast that begins on Monday. Israel allowed dozens of truckloads of food and medical supplies into Gaza on Thursday, but it was unclear when it would let cash into the coastal enclave to replenish currency stocks. Palestinian Prime Minister Salam Fayyad, whose Western-backed government is based in the Israeli-occupied West Bank, said this week that there was not enough cash in Gaza to cover salaries for more than 77,000 government workers. Fayyad said 250 million Israeli shekels ($63 million) was needed to pay these salaries but Gaza's banks had only 47 million shekels. Israel tightened its blockade of Gaza a year ago after Hamas wrested the territory from secular Fatah forces loyal to President Mahmoud Abbas. It has tightened the closure further since a deadly raid by its forces on Nov.4, followed by a surge in rocket attacks by Gaza militants. The border closings have increased hardships for many of Gaza's 1.5 million residents. An Israeli military spokesman said 15 rockets and mortar bombs have been fired from Gaza at Israel since Thursday, but there were no casualties. (Writing by Allyn Fisher-Ilan; Editing by Michael Roddy)
A Jewish settler carries her child inside a building occupied by settlers in the West Bank city of Hebron November 21, 2008. Jewish settlers spray-painted graffiti insulting the Prophet Mohammad on ...
