Capitalism vs Nationalism in Palestine


According to an important recent study by Issa Smeirat, an MA student in economics at Al-Quds University, private Palestinian investment in Israel amounted to 2.5 billion dollars in 2010, according to the most conservative estimates. Less conservative estimates put the number at more like 5.8 billion dollars. Private Palestinian investment in the West Bank is just 1.5 billion dollars. The study has all kinds of important implications: on the way Palestinian collaboration is being built into the structure of the Palestinian elite, as it has since Oslo, presaging what the sort of two-state settlements envisaged at Geneva or in the Saudi Peace Plan would look like – emasculated states with no economic sovereignty (the question of political sovereignty can barely arise, especially when bamboozled leftists are too often cheering for NATO to save brown people from their brown leaders).

Amira Hass – of course it is Hass reporting this research – notes that apparently, ¼ of the investments are in industry. As Israeli investors have moved into high-tech, Palestinian investors were able to start putting their money into heavy industry. It doesn’t say, but this sector probably has lower yields than the high-tech sectors. Part of the Palestinian investments are directed towards providing skilled workers for the various industries, part of the effect of the ongoing de-development of the Gaza Strip and the West Bank, as productive industries as well as agricultural production within Palestine have been systematically gutted so that even those trained for professional or highly-skilled tasks cannot find jobs in which to use those skills. Instead, they end up using them in Israel.

Hass writes:

But also in East Jerusalem itself, says Smeirat, the number of Palestinian investors in Israel is relatively small, despite the fact that they are not subjected to the same mobility restrictions and bureaucratic demands as residents of the West Bank.

The low number is indicative of the process of the impoverishment of Palestinian society in East Jerusalem under Israeli rule. A look at the registration methods of the Palestinian companies shows that although 23 percent of the companies are in partnership with Palestinian residents of Jerusalem, in fact sometimes this is indicative of a fictitious partnership aimed only at making the bureaucratic proceedings easier. Another 16.6 percent are in partnership with a Palestinian citizen of Israel, 16.3 percent are in partnership with a Jewish Israeli and 8.8 percent reported that their Jewish partner was only “cover” and received either a one-time or a regular commission. Twenty percent are subcontractors of Israeli companies.

Three thousand of the 16,000 investors are from Ramallah, just one thousand from East Jerusalem, formerly the economic heart of the Palestinian West Bank.

Hass continues:

Smeirat’s findings reinforce the Palestinian national economy ministry’s view as manifested in its study of the price the occupation exacts from the Palestinian economy. According to this study (Haaretz, November 11 ), the Israeli restrictions depicted as security restrictions are connected to the colonial nature of the Israeli occupation, and are aimed at preventing competition from the Palestinian economy.

Smeirat asked the subjects of his study whether they would want to go back and invest in the areas of the West Bank. Of his respondents, 35.3 percent replied in the negative, 28.9 percent said they would go back if the PA manages the economy better, and 35.8 percent said they would go back if conditions were improved (such as better infrastructure and loans ).

This research points up the Israeli method of social, economic, and political control in the Occupied Territories, as well as why the precise terms of temporary status documents are so important. For example, the Paris agreements explicitly permit Palestinian investments in Israel. What’s also important is that the iron laws of capitalism – the need for outlets for investment so that capitalization can proceed apace, letting capital grow – proceeds even in this extreme circumstance in which the material, or more precisely the capitalist institutional incentives, run directly against the moral or idealist incentives or pressures from Palestinian nationalism.

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