Felice Friedson, Arieh O'Sullivan
The Media Line
June 9, 2010 - 12:00am

A conference of Arab investors, foreign officials and Palestinian businesspeople garnered nearly a billion dollars in pledges to the Palestinian economy, with special focus on boosting small and medium businesses.

Meeting in Bethlehem, the second Palestine Investment Conference (PIC) focused on investment opportunities in the West Bank and Gaza Strip where small and medium operations account for some 90 percent of Palestinian businesses.

Private sector pledges accounting for $828 million were earmarked for long-term mortgages, electric power stations, solar energy, and endeavors ranging from an olive oil company to information technology firms. U.S. government investment included funding for a wireless Internet network in Jenin.

“We think this is an ample opportunity for the Palestinian businesspeople to meet with their counterparts from different countries. This is a very good opportunity to show the world that Palestine is not only all about conflict, all about occupation. It also has very good business opportunities and investment potential,” said Ayman Sbeih, one of the organizers of the conference.

“Palestine in a virgin area,” added Manal Zraiq, the general director of Massar holding company and a founding member of Business Women Forum in Palestine. “It needs investment in any area and believe me, we do make money here in Palestine. I am encouraging any one who would like to make money to come and invest in Palestine.”

Dozens of business -- ranging from quarries; to manufacturers of chocolate, olive oil and textiles – showcased their products and services at the richly designed convention center built near the Biblical Solomon pools south of Bethlehem.

Hawking the Majhul dates he grows in Jericho, Ibrahim Manasrah, vice president and marketing director of MADICO, said he was trying to market his dates as a Palestinian brand. He said the potentially volatile environment often put off would-be investors.

“Potentially, many people want to invest, but there is a little bit of uncertainty because not everything is clear. People will always wait because no one can predict what can happen and there is no rationality behind what happens due to past experiences.”

The Bethlehem conference attracted more than 1,000 entrepreneurs, financers and officials from all over the world. Those interested in sponsoring projects were shown investment opportunities while political leaders used the conference and its massive audience to invoke their agendas.

Keen on supporting a robust Palestinian economy, Israel facilitated the entry of businessmen and women from Jordan, Saudi Arabia, United Arab Emirates, Kuwait and other Arab countries that have no diplomatic ties with Israel. Most notable was that Israel also allowed in 108 businessmen from the blockaded Gaza Strip.

The 2010 PIC was the second in a series of investment conferences that continue to generate positive momentum for Palestinian economic development. A total of nine private sector projects were announced in Bethlehem -- the largest a $500 million fund from the Al-Amal group that aims to provide Palestinians with long-term loans and home mortgages. Another project was announced is a $300 million electricity plant to be built in the northern West Bank. The goal of other projects is to boost the fledgling hi-tech industries.

A U.S. Presidential delegation was led by Obama Mideast-envoy George Mitchell. This high-profile visit was seen as the stamp of approval for American support. The USAID announced it had allocated $75 million to support new Palestinian infrastructure projects and another $30 million to develop legislative and regulatory frameworks that will foster investment and trade; and fund business.

“These funds will work to stimulate the Palestinian economy, support institution building and lay the foundation of a future Palestinian state,” U.S. State Department spokesman Philip J. Crowley said.

A USAID statement said the funding “signifies the commitment of the United States government to help promote sustainable economic development in partnership with the Palestinian Authority and to lay the foundations of a viable, independent future Palestinian state.”

The French government signed an agreement valued at 5 million Euros to support the Palestinian private sector through banking and to study three solar energy projects.

The conference was hosted by Palestinian Authority President Mahmoud Abbas, who met separately with Mitchell for the ongoing, indirect talks with Israel that the special envoy is mediating.

“Many people say that this a way forward for peace and sets the stage for the peace process and helps the drive for peace,” said conference organizer Sbeih.

Currently, the Palestinians are intimately tied to Israeli markets. According to the Palestinian Central Bureau of Statistics, 90 percent of Palestinian trade in 2008 was with Israel. The Palestinians hope to widen their markets.

“We are an economy that is vulnerable to political changes. There is a strong basis for growth but if there is any setback in the political scene we will find the economy quickly reflecting negative attitudes,” said Samir Abdullah, former Palestinian minister of planning. “Our economy is really vulnerable under occupation, and when the Israelis turn on the closure machinery, this makes it difficult for the private sector.”

Abdullah said that there was a lot of potential for economic growth in the Palestinian areas to surpass the 8 percent growth it recorded in 2009. “I think there is a potential to witness even two-digit economic growth. If there is relief of restrictions and increase in export; and the opening of new markets, definitely the economy will grow,” he said.

Diaspora Palestinians are being encouraged to play a key role in enhancing local business ties.

“We are trying to encourage the Palestinian Diaspora, especially the Palestinian Americans, to invest here. There are investments in Palestine for a small amount of money; from $10,000 to a million dollars, there are opportunities,” said Rateb Rabie, a Washington D.C.-based entrepreneur of Palestinian descent.


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