Old but Hot: The Palestine Pound

The pre-1948 currency, called the 'lira' or 'funt' in Hebrew and 'junya' in Arabic, is in demand by collectors. Both Jews and Arabs see it as a piece of history whose value will only rise.

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While the region is ablaze again and the Israeli-Palestinian conflict is at a boil once more, there are those who are profiting from the conflict. The Kedem Auction House is reporting a significant rise in the demand for pre-1948 currency from (British) Mandatory Palestine. The demand comes from merchants and collectors alike.

Among those making inquiries are customers from Saudi Arabia, Qatar and other Gulf States. Some of these are Palestinians who emigrated from the West Bank, became wealthy and are now returning on "shopping expeditions," as they are called by the Auction House.

Such bills were first issued in 1927, a decade after the Balfour Declaration, in which the British Government declared its favorable view regarding the establishment of a national home for the Jewish people in Palestine. These bills replaced the Egyptian lira, which had been legal tender in Palestine until then. The new currency was linked to the British pound, and the notes were trilingual, including writing in Hebrew, Arabic and English. They were in use until 1948.

“Alongside the joy they evoked in the Jewish community, these notes aroused anger and grievance among Arabs, mainly due to the use of the Hebrew language, and the Hebrew name for the country, as well as the depiction of Jewish symbols and holy sites on the bills,” sources at Kedem say.

However, the passage of time has changed things. Now, many Arabs are interested in these bills for the opposite reasons. “There is now interest in these bills as part of a national struggle. They are collected in preparation for the establishment of the Palestinian State. This is something of a 'retro’ phenomenon of yearning for Palestine, as a symbol of what is to come,” says Mark Kaputkin, a coin expert and trader in a conversation with Haaretz. “They collect anything with the name ‘Palestine' written on it, including bills marked with ‘Anglo-Palestine Bank,’” he adds. The fact that this bank was owned by the Zionist Federation and later became the central bank of the nascent Jewish state doesn’t matter to these collectors.

According to Kaputkin, even Yasser Arafat used to walk around with half-lira and lira notes in his pocket, showing them off as support for his claim that Palestinians are the true owners of the land. “The Hebrew script will not be removed from these bills, since that would detract from their authenticity and value,” Arafat reportedly said.

In the catalogue issued by Kedem ahead of the July 16 auction, much space is devoted to these bills. Officials at Kedem explain that Arab customers purchase them in three ways: through Israeli Arab traders in Haifa, Jaffa and Nazareth, through dealers in Arab countries that have diplomatic relations with Israel such as Jordan and Egypt, and through websites.

The rising value of these notes indicates to some traders that the Palestinian state is imminent. A similar rise in value occurred in 1993 with the signing of the Oslo accords. Their price doubled in 2002 after the second intifada broke out. Their value also increased in 2004 along with the disengagement from the Gaza Strip and in 2009, after Netanyahu’s Bar Ilan University speech in which he supported a solution of two states for two peoples, and again in 2012 when the UN General Assembly gave the Palestinians observer status at the UN.

One of the bills that will go on sale next week is a ten lira note from 1939, with an opening price of NIS 26,000. The note bears the image of a famous 14th-century minaret in Ramla, dating to the Mamluk period. A decade ago similar bills were sold for around NIS 5,000. Two other one lira bills, also from 1939, will be sold as well, with an opening price of twenty thousand shekels. A decade ago they sold for one thousand shekels. “The reason for the astronomical leap in their value stems from the fact that they show the Dome of the Rock with the name Palestine above it,” says one official at Kedem. “Such bills are still given as gifts to sheikhs and other notables.”

Jewish merchants also express interest in these bills, since they are the first to derive from the territorial entity from which the state emerged, thus serving as important milestones on the way to independence. “These bills have become a small part of the conflict, and each side uses them as support for its positions and arguments," the officials says. "For Jews these bills are part of the road leading to the establishment of the state of Israel whereas for Palestinians they are a sign of hope for the establishment of Palestine. This is what makes these bills, which aren’t that old, something so special.”