Alwaght- Since the start of the all-out Israeli invasion of Gaza in October 2023, the global uprising against the Israeli regime has been boiling over and meanwhile one of the collective civil struggle methods by the people of the world has been launching the campaign for boycott of Tel Aviv, targeting products originated in the occupied territories and foreign companies funding Tel Aviv.
In one of the latest moves, Ireland government plans to ban Israeli products in response to continued Israeli settlement construction in the West Bank.
The AFP, citing Ireland government spokesman, reported the Irish government agreed to pass a bill "banning business with illegal Israeli settlements" in the occupied territories.
This measure had earlier been put on agenda by some other European countries in response to the continuation of illegal settlement construction by the Israeli regime under the right-wing Netanyahu government. This measure could have negative effects on the regime’s war-torn economy and increase the burden of the government’s problems.
The economic output of the Israeli settlements in the West Bank is estimated at $41 billion annually, which makes a significant contribution to the regime’s economy. For this reason, the continuation of these boycott campaigns has led the Israeli government to seek ways to circumvent the sanctions laws, including by marketing the products produced by the settlers using different names and methods, or by increasing the provision of economic and commercial facilities to industrial and agricultural facilities located in the settlements.
Meanwhile, one of the issues that is less discussed is that the effects of the boycott are not limited to causing economic losses to the regime, but rather this move can strengthen Palestinian domestic production and Palestinian economic independence from the regime.
Palestinians increasingly see the Paris Protocol (the Economic appendix to the Oslo Accords, signed by the Palestinian Authority and Israel in Paris on April 29, 1994), which allows the Israeli regime to economically dominate Palestinian lives, as a trap that has destroyed the Palestinian economy and hindered its progress.
Boycotting the occupation: A historical and constant approach
Boycotting the Israeli regime is not a new idea, rather, it was put forward since foundation of the Zionist movement. Even before the uprising of 1936, there were campaigns to boycott of Israeli goods. In 1922, a campaign to boycott Jewish companies in Palestine was organized, culminating in the 1936–1939 uprising. During the First Intifada, the united national leadership succeeded in promoting a resistance economy by boycotting Israeli goods, reducing the number of Palestinian workers in the occupied territories, and boosting domestic production in the West Bank. During the First Intifada, Palestinian markets were emptied of Israeli products, agricultural production increased, cooperatives and grassroots initiatives were formed in the agricultural sector, and during the years of the Intifada, the number of trees planted reached half a million.
This trend continued during the Second Intifada, with the number of Palestinian workers in the occupied territories falling from 145,000 in 2000 to 66,000. After the Second Intifada, as Israeli violations of international law intensified, the global BDS (Boycott, Sanctions and Divestment) movement was formed to pressure Israel, copying its idea from the anti-apartheid campaign in South Africa.
Palestine trade and its reliance on Israeli economy
Israeli occupation has always insisted on controlling all segments of the Palestinian economy and subjugating it. The Paris Protocol sets the border crossing mechanisms and the amount and the type of the goods imported. Also, the protocol has had a role in controlling the tax system and has left only limited powers to the Palestinian Authority (PA) like taxing the income and taxing the properties. This has caused structural poverty and made the Palestinian economy a service-based one, fragile, and incapable of employing labor force. As a result, reliance on the Israeli job market has increased, to an extent that before Gaza war, about 20 percent of Palestinian labor force was employed by Israeli businesses, namely income of 20 percent of the Palestinian families is tied to the Israeli blackmailing and bargaining of the Israeli occupation.
Despite the PA’s repeated efforts to build a state and a national economy and spending some $44 billion in international aid on state-building and comprehensive development planning, the Palestinian economy’s dependence on the Israeli economy has increased and the restrictions that weaken it have become more stringent. This has made the Palestinian economy more vulnerable to crises. What we are witnessing today, like economic recession, the ban on Palestinian workers working in the occupied territories, the cutoff of public budget funds, Tel Aviv’s freezing of more than half of the Palestinian funds, and the payment of only a portion of the salaries of public sector employees, all stem from this Palestinian economic dependence on the Israeli economy.
One of the most important mechanisms of Israel’s economic dominance over Palestine’s foreign trade is through the “customs union.”
Accordingly, in 2022, the value of Palestinian imports from Israel reached $4 billion, accounting for 56 percent of the total $8 billion in imports. In contrast, Palestinian exports to the occupied territories were $1.3 billion, accounting for 88 percent of total exports. In comparison, Israel’s exports to the world in 2022 reached $76.9 billion, of which only $4.6 billion (5.9 percent) went to the Palestinian market. This figure shows the significant impact that the boycott of Israeli products in the Palestinian market, if continued and expanded, could have on empowering the Palestinian economy, moving towards a resistance economy, and strengthening the culture of resistance and boycott as a form of popular struggle.
According to the Tel Aviv’s own data, the global boycott of Israeli goods in 2013-2014 resulted in accumulated losses of about $15 billion for the regime and led to the withdrawal of many foreign investments from the occupied territories. This prompted the then-minister of finance of the regime to warn about the consequences of the growing global expansion of the BDS movement.
With the beginning of the genocidal war on Gaza since October 2023, the impact of the boycott in global markets and the change in consumer behavior towards Israeli products became apparent. Calls for boycotts of pro-Israel brands have even increased in Western countries, with some brands such as McDonald's, KFC and Zara being hit hard. Starbucks' share price has also fallen. The impact of boycott campaigns has not only changed consumer behavior, but many stores, restaurants and cafes have also joined the movement by stopping the sale of boycotted products. The boycott campaigns against Israel have also led to the withdrawal of many investments this year: technology giant Intel has stopped building a new $25 billion factory in the occupied territories, the Norwegian Petroleum Fund, with assets of $1.6 trillion, has canceled all its investments in Israeli bonds, and two major Japanese companies, Itosho and Nippon Aircraft, have cut ties with Israel's largest private arms manufacturer (Elbat Systems). Recently, Colombia announced that it will slash Israel from its coal exports destinations.
Effects of boycotting Israeli products and boost of Palestinian economy
The aforementioned data show that over half of the Palestinian imports are from Israel, though after war the value of these imports has dropped.
In the fourth quarter of 2023, this amount reached $891.7 million, while in the fourth quarter of 2022, this figure was $1.2 billion. It is also a significant decrease compared to the quarters before the war. This is due to several factors, including the deterioration of the economic situation, the intensification of Israeli restrictions on the movement of people and goods, as well as the boycott of the occupation regime's goods by the Palestinians. This downward trend continued in the first and second quarters of this year, and the value of Israeli imports remained below $900 million.
A closer look at Israeli imports to the Palestinian market reveals that by cutting off just one-third of these imports (equivalent to $1.6 billion) and injecting them into the Palestinian market, more than 100,000 new job opportunities (about 10 percent of the Palestinian workforce) can be expected to be created. There are currently 36 products that can be replaced by domestic production, including mineral and carbonated drinks, dairy products, agricultural goods, eggs, fruits and vegetables, animal feed and fertilizer, livestock, cement, mobile phones, chocolate and candy, and wheat.
According to the data, the share of domestic production in the Palestinian market in 2022 was about 43 percent, which increased by 2 percent in 2023, following the boycott of Israeli goods, meaning more job opportunities. The boycott of Israeli products caused sales of Israeli juices and beverages to decrease by 82 percent and dairy products by 60 percent, while production in the Palestinian beverage, detergent and chemical industries grew by between 200-300 percent.
In practice, the Palestinian market has witnessed a widespread boycott of many Israeli consumer goods, especially food products. Although some goods were boycotted before the war, the scope of the boycott broadened after the war. The emergence of Palestinian-made products, especially in the fields of dairy products, beverages and detergents, is also clearly visible. According to the CEO of Al-Junaidi Company (a dairy producer), the boycott of Israeli products after the war led to a 5 percent increase in their sales, despite a 20 percent halt in sales in Gaza. He noted that previously, Israeli companies controlled 85 percent of the Palestinian dairy market, but today domestic products control about 90 percent of this market. On the other hand, the chairman of the board of directors of the Palestinian Poultry Company stated that during the war, the supply of chicken in the Palestinian market decreased due to a decrease in the import of hatching eggs from Israel and a decrease in their smuggling, which led to an increase in the price of chicken and, consequently, an increase in profitability. The marketing manager of Al-Salam frozen food company reported to local media a 12 percent increase in sales compared to last year, and it was announced that the production line had been expanded and frozen chicken had been added to the company's products.
With increase to the public awareness of the importance of boycott and globalization aversion to the Israeli occupation and products, which have intensified as Israeli expanded its crimes, reception of Palestinian products replacing foreign ones has increased.
Although sales of some domestic goods have increased and new local or even imported products have emerged, it should be kept in mind that the success of the boycott is not measured solely by numbers, but rather as a seed to strengthen the resistance economy and increase the collective sense of the need for change and resistance.
Boycott serving as a tool to weaken Israeli economic hegemony
The Palestinians have been adopting a resistance economy approach for decades; an approach indicating policies and economic measures to counter sanctions using tools that help bolster economic independence and bring about gradual economic and social relations rebuilding as requirements and political aims for the national process of liberation.
Now is a historic opportunity to revive resistance economy approach and boost boycott of Israeli products. This takes a series of policies and actions that beef up boycott, advance Palestinian economy, and form collective political will to coordinate all factions for strengthening boycott movement and taking gradual steps to break from economic dependence on the Israeli regime. To achieve this aim, the Palestinian government must be mandated to act more seriously and develop a comprehensive plan to direct investment towards Palestinian goods replacing Israeli ones. These investments must also be supported by providing protections, facilities, and tax exemptions to strengthen the resistance-based economy. In addition, it is necessary to implement the 2014 decision to increase customs tariffs by 35 percent on all imported goods that have Palestinian substitutes (such as clothing, aluminum, and shoes) in preference of domestic production.
Also, the government should approve tax support policies to back some industries like metals, food, clothing, and furniture that account for over 70 percent of exports and 9 percent of the Palestinian GDP since these industries are facing unfair competition due to presence of imported and Israeli products in the Palestinian market. To support domestic production, necessary measures could include ban on the import of Israeli goods and businesspeople that import products with local substitutes should be cracked down on, in accordance with PA-approved Law No. 4 of 2010 on the Prohibition and Counteraction of Products from Zionist Settlements."
Finally, we should say that boycott is not just a symbolic measure; rather, it is an essential step toward building an independent Palestinian economy—one of the requirements on the journey to liberate Palestine from Israeli occupation.
