The passengers on an El Al flight from Tel Aviv last week to Amsterdam’s Schiphol airport were quickly separated and ordered to put their luggage through a screening machine. New checks have been implemented to ensure that travellers are not bringing in forbidden goods from East Jerusalem, the West Bank or the Golan Heights. Writing in Nieuwrechts, a conservative website, Sivan Behr described how surly customs officers corralled the passengers, many of them Israeli, into a separate queue, while shouting at them. Dutch officials, of course, have always been efficient at separating Jews and non-Jews. During the war they separated 107,000 Jews and sent them to the Nazi camps. Only 5,000 returned.
Can we expect such scenes soon at Heathrow or other British airports? Doubtless much of the Labour party, the Greens and the Gaza bloc MPs would welcome such measures. The government has announced similar restrictions, with the details to be published in several months. Settlement goods will be banned. Any business, organisation or individual providing finance, infrastructure or other services for settlements will face penalties. In fact the decision is an economic absurdity, the equivalent of Argentina sanctioning Surrey but not Sussex for sovereignty over the Falklands. It is not possible to sanction a section of a national economy or shared currency area without significant consequences for the remainder – in this case, the Palestinian territories.
The Israeli and Palestinian economies are thoroughly enmeshed. Israel, the Palestinian territories and incidentally, Gaza, all use the same currency: the Israeli shekel. (US Dollars and the Jordanian dinar are also used in the Palestinian territories.) Israeli banks provide vital correspondence services for their Palestinian counterparts. Arguably, it would make more financial sense – and be more politically honest – to sanction Israel proper. But that would exact too high a price: for the NHS which relies on Israeli medicines, the security services which rely on Israeli intelligence to keep us safe, the British military which relies on Israeli defence technology.
Instead Burnham and Miliband have opted for a mess of virtue-signalling which will make life worse for the Palestinians. The Palestinian Monetary Authority does not yet issue a sovereign national currency. For now the Palestinian economy is ‘so interlinked with the Israeli economy’, says Daniel Abir, deputy governor of the Bank of Israel, that the shekel is ‘the obvious choice of currency’. Thus the prospect of UK sanctions raises several key questions that would test greater minds than those of the Prime Minister and Foreign Secretary. Most of all, how will these sanctions be able to impose meaningful pain on their targets while not impacting on the Palestinians?
The Palestinian Monetary Authority estimates that Israel Discount Bank and Bank Hapoalim process 51 billion shekels (£12.6bn) a year in transactions for the Palestinian Authority. Ninety per cent of Palestinian trade such as food, fuel and medicines passes through Israel. Thus any sanctions on Israeli banks, firms and the wider economy will immediately be felt in the Palestinian territories. Israeli banks, supermarkets and telecommunications companies all operate in the West Bank. Bank Hapoalim and Israel Discount Bank have branches in, for example, the town of Ma’ale Adumim. While technically a settlement, as it lies beyond the Green Line, Ma’ale Adumim is practically a suburb of Jerusalem and will likely remain inside Israel in any future peace settlement. Will a presence in Ma’ale Adumim be regarded as grounds for sanctions? Or how about Israeli bank branches in East Jerusalem, which was also captured in 1967?
In addition, several Israeli banks and companies run substantial operations in Britain. British potential partners may now feel the need to conduct extensive and potentially expensive investigations into the Israeli firms’ areas of operations and location of their subsidiaries before doing any business together. The phenomenon known as de-risking, or overcompliance, means that rather than take any risk of breaching sanctions, British firms and investors may simply choose not to partner with Israeli institutions at all. None of this will help the Palestinians. In fact, it will damage the Palestinian economy and likely cost jobs. As Richard Pater, chief executive of Bicom, a British think-tank, notes, around 20,000 Palestinians work for Israeli companies on the West Bank. All of these jobs are now potentially under threat. ‘The UK’s latest policy towards Israel is an act of political posturing against a critical trade and security partner, disregarding our own national interests.’
The case of SodaStream is illustrative
The case of SodaStream is illustrative. SodaStream operated a factory in Mishor Adumim, the industrial zone of Ma’ale Adumim. The factory employed 1,300 workers, including 500 Palestinians from the West Bank. Their pay and benefits far outstripped anything else they could find on the West Bank. Nonetheless, the Boycott Sanctions Divestment (BDS) movement launched an international campaign against SodaStream. BDS got its victory. In 2015 SodaStream closed its Mishor Adumim site and opened a new factory in Lehavim, in the southern Negev desert, inside Israel proper. The BDS movement was jubilant. ‘This is a clear-cut victory against an odiously complicit Israeli company,’ said Omar Barghouti, a co-founder of BDS. SodaStream said that the campaign was not the key factor in the relocation and it planned to expand its operation. The company tried its best to secure work permits for its 500 Palestinian employees to be allowed to cross into Israel and work at the new factory – an arduous, lengthy journey through checkpoints.
The relocation may have been a victory for the BDS movement but was a catastrophe for SodaStream’s Palestinian workers. They needed work permits, which were not granted by the Israeli government. All 500 eventually lost their jobs. Thanks to Labour’s virtue-signalling many more Palestinians could also lose theirs.
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