Opinion

Palestine’s economy is more than meets the eye

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We write to you from occupied Palestine, a beautiful land with beautiful people who are engaged in building an economy to serve their burgeoning state. 

We know all too well the real-life hurdles Palestinians must overcome to simply do business. We just visited a handful of firms in the West Bank and saw their reality firsthand through our work with Americans for a Vibrant Palestinian Economy or AVPE, a non-profit that builds bridges between American and Palestinian businesspeople.

The World Bank cites Israeli restrictions on trade in the West Bank and Gaza as a major factor in “crippling” Palestinian economic development. For the past 25 years we saw billions of dollars invested in the name of economic development. The result? The recent Food Security Sector index reports nearly 70 percent of families are food insecure in Gaza. The World Bank found unemployment exceeded 50 percent in Gaza and 30 percent in the West Bank. 

However, let us not concentrate on reports and statistics alone. AVPE focuses on assisting specific businesses, which means we see the effects of occupation up close. We want to share some of those stories to paint a picture of just how hard it can be to build these bridges, as well as to depict how amazingly resilient the Palestinian business community is. 

Hussein owns a chocolate factory in Anabta, Al Hijaz. We work with Hussein to access the tools and knowledge necessary for U.S. market entry. This not only means jumping through all the normal hoops of exporting to the U.S. (FDA Regulations, ISO Certification, etc.) but also facing the stark reality of Israeli control. Restricted access to water and electricity (both sold by Israel to Palestinians) can prevent the factory from working efficiently. Prolonged waits at checkpoints can incur extra costs as transporting chocolate in a hot environment means expensive refrigerated transport.

Before Al Hijaz’s product has even left the continent, it suffers unnecessary expenses merely because it is a Palestinian product. Occupation means that the movement of all goods and all ports are controlled by Israel. Al Hijaz is forced to use Israeli transport companies to reach export markets. Adding insult to injury, Palestinians are often a captive market for Israeli companies. Holding an economy hostage has its benefits.

Another of AVPE’s beneficiary companies, Transcend, a Bethlehem-based technology company founded in 2010, has been able to grow their client base across the globe, including a high-profile academic association in the U.S. Despite what seems to many as policies aimed at de-developing Palestine, a few companies have endured with a combination of grit, hard work, and perseverance. Beit Jala Pharmaceuticals, another firm located near Bethlehem that AVPE works with, is unable to produce certain medicines due to restrictions on the import of necessary raw materials. Meanwhile, the pharmaceutical industry in Israel is one of their largest sectors, exporting products to the U.S. and across the globe. 

Palestinians inspect the rubble of a dairy factory demolished by Israeli bulldozers, at the al-Rama neighborhood near the West Bank city of Hebron on September 2, 2014. Israeli bulldozers demolish. (Photo: Mamoun Wazwaz/APA Images)
Palestinians inspect the rubble of a dairy factory demolished by Israeli bulldozers, at the al-Rama neighborhood near the West Bank city of Hebron on September 2, 2014. Israeli bulldozers demolish. (Photo: Mamoun Wazwaz/APA Images)
A Palestinian man works at the Herbawi factory in the West Bank city of Hebron on October 14, 2010. (Photo: Najeh Hashlamoun/APA Images)
A Palestinian man works at the Herbawi factory in the West Bank city of Hebron on October 14, 2010. (Photo: Najeh Hashlamoun/APA Images)

We realize most people don’t understand clearly the web woven by Israeli occupation. It is an intricate web with little useful purpose one can make any sense of. Nearly 80 percent of Palestinian exports are destined for the Israeli market. This may be a surprising fact to many, but it is common for landlocked nations to majority trade with their neighbors. 

What is surprising is how interlinked and interdependent the two economies are. AVPE recently began working with the Palestinian Plastic Industries Union, based in Hebron. After visiting with one factory owner he said something that stuck with us. Palestinian companies sell a majority of their products both locally and to Israel. Israel gets a portion of its plastic bags from Palestine. He noted that just a few days strike could cause ripples in the Israeli economy. 

Likewise, a similar few days of Israeli military closures could prevent Palestinian day laborers from entering Israel causing negative effects on both economies. Israel can find other suppliers of plastic bags, but cannot so easily replace the cheap labor. Again, holding an economy hostage has its benefits.

How can Palestinians build a growth economy when Israel controls all aspects of their economic life from access to natural resources, movement of goods and people, customs and borders, custom duties collection, and more? Palestine needs economic development in Palestine, not to contribute to Israeli economic growth. 

No amount of investment dollars can change the painful Israeli-made facts on the ground. Economic development without statehood has gotten us to this point, and that point is nowhere. 

Given all the challenges, it is a tribute to the determination of the Palestinian people that there are any stories of success at all. True economic development will only come when Hussein can export without the shackles of Israeli occupation. Until then, we will continue to build bridges with the hope that one day Palestinians will be able to walk on them freely. 

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Israel is using a modern form of ancient siege warfare, plain and simple.

https://www.btselem.org/publications/summaries/201909_playing_the_security_card “Playing the Security Card” “Israeli policy in Hebron as a means to effect forcible transfer of local Palestinians” B’tselem, Summary, September, 2019 “For 25 years, Israel has been openly pursuing a policy of segregation in the center of Hebron, in order to allow a handful of Jewish residents to live as though they had not settled in the middle of a bustling Palestinian city, in the heart of an occupied territory. This policy completely… Read more »