US Treasury's Bessent, Israeli finance minister agree to strengthen dialogue on economies

U.S. Treasury Secretary Scott Bessent and Israeli Finance Minister Bezalel Smotrich on Wednesday said they agreed to strengthen dialogue and enhance collaboration in a meeting Wednesday focused on the two countries' economic partnership.

"This is a critical time to shape a new strategic economic future for both countries, reinforcing American global leadership and Israel's role as a key economic partner," the two men said in a joint statement released by the Treasury.

"To advance shared economic interests, both sides agreed to strengthen dialogue mechanisms to enhance collaboration in key areas, including economic policy, technology, and financial regulation," they said.

The statement underscored the need for a coordinated approach aimed at ensuring bilateral ties remained a source of economic resilience, innovation and mutual benefit.

The statement made no mention of Israel's banking relationships with Palestinian banks, which had been an irritant between Smotrich and Treasury officials under former President Joe Biden.

Treasury in December welcomed a decision by the Israeli cabinet to approve a one-year extension of its indemnification for Israeli banks, which shields Israeli banks with ties to the Palestinian counterparts from anti-terrorism laws, after previously approving just one-month waivers.

Bessent's predecessor, Janet Yellen, in May raised public concerns about Israel's threat to cut off Palestinian banks from their Israeli correspondent banks, potentially severing a critical lifeline for the Palestinian economy.