How Palestinians hope to increase exports

Earlier in September, the Palestine Trade Center announced the Palestine Exporter Award for 2016, a national recognition to promote an export culture among Palestinian firms, encourage diversification in exports and support access to new markets in a bid to achieve national economic development.

al-monitor A still from a video in which Ibrahim Barham (L), president of the Palestine Trade Center, announces the opening of registration for the Palestine Exporter Award 2016, Ramallah, West Bank, Sept. 5, 2016. Photo by YouTube/Wattan News Agency.

Topics covered

west bank, palestinian economy, industry, gaza, foreign trade, exports, economic development

Oct 11, 2016

GAZA CITY, Gaza Strip — The Palestine Trade Center (PalTrade) announced at a Sept. 5 press conference, held in al-Bireh, the opening of registration for the Palestine Exporter Award 2016 for six categories that include industryagriculture, services, tourism, female investors and promising or new firms. The award aims to showcase Palestinian economic capabilities, encourage competition in the production and services sectors, boost Palestinian annual exports, promote an export culture and support access to new markets in order to achieve inclusive economic and sustainable social developments in Palestine, both in the West Bank and Gaza.

The award is also part of the National Export Strategy adopted by the Palestinian government in collaboration with PalTrade in early 2015 to increase exports by 67%, with an average annual growth of 13%, within the next five years.

According to statistics by the Palestinian Central Bureau of Statistics, the total registered exports of goods in the West Bank reached $953.8 million in 2015, a 1.7% increase from 2014, while the Gaza Strip registered a decrease of 37.5% compared with 2014, with an estimated total of $4 million in registered exports of goods.

Shadi Chahine, PalTrade’s Trade Policy Department director, told Al-Monitor that the main challenges of exporting include customs constraints, security checks, foreign market policies, the product’s ability to meet the world technical standards and Israeli restrictions on border crossings, along with the strict procedures imposed on exporters that aim at impeding the Palestinian economy and keeping it dependent on the Israeli one.

Chahine noted that Palestinian exports found access to more than 72 countries last year.

Samir Hulileh, the chief executive officer of PADICO Holding, the company sponsoring the award ceremony, told Al-Monitor, “The research and studies on the Palestinian economy have shown that the local market is weak, small and fragmented because of the Israeli measures and the separation of Gaza from the West Bank and Jerusalem. Thus the only way to develop the Palestinian market is through exports to foreign markets.”

He added, “Foreign exporting is much easier than local trade due to the Israeli blockade on the Gaza Strip. This is because the political obstacles and the security measures imposed on the local market are not applied on Israeli ports or the [Jordanian] Karameh border crossing, from which products are exported.”

Hulileh further noted that it is difficult to export Palestinian products, as foreign importers have their doubts about the quality of products and the ability to deliver them on time since Palestine is an occupied state and does not enjoy economic sovereignty. He added that the Palestine Exporter Award aims to improve the reputation of the Palestinian economy.

Regarding the role of the award in increasing exports, Chahine said, “The Exporter Award is the first of its kind in that it encourages exports to foreign markets and seeks to increase the number of Palestinian exporters.”

According to Chahine, in addition to boosting and encouraging Palestinian exports, the award also aims to give a positive image about the national economy by changing the existing distorted impressions and allowing national firms to access foreign markets.

He added that the award was widely hailed at the national level last year, which called for a second installment, turning it into an annual award, as last year saw competition from 75 Palestinian companies, a number expected to increase this year.

Chahine further noted that the six categories set for the competition included all production and services sectors, in addition to a grand title called “Palestine Prime Exporter Award,” which takes into consideration the sector, the number of markets accessed as well as the firm’s contribution to social responsibility and employment.

As for the competition procedures, Chahine explained, “The competing firms must fill out an application and meet the standards for each award category.”

The main standards, he said, include the firm’s export capacity, the number of target markets and the nature of the exported product.

Chahine pointed out that last year’s winners may not compete in the same category as last year, but may, however, choose another category in which to compete.

Chahine said a panel of specialists composed of notable Palestinian figures with extensive experience in economic development in Palestine will evaluate the candidates according to the standards posted on the website and check their validity and the degree to which they are met. He said the winners will be announced during a Nov. 16 ceremony.

In terms of the funding allocated for the award, Chahine revealed that the award is honorary in nature, allowing winners to use it in international markets as a testament to product or service quality.

In turn, Majdi Zghier, the CEO of Hebron-based Royal Industrial Trading Co., which specializes in plastics and was the winner of last year’s award for the industry category, told Al-Monitor, “The firm’s keenness on competing for the award came after obtaining a certification distinguishing it from the rest of the Palestinian firms.”

Zghier indicated that the firm targets 16 Arab and foreign markets, with total exports worth $14 million last year, noting that the award did not lead to an increase of the firm’s exports this year.

“The award is honorary at the local level. It lacks significance at the international and even Arab levels that might help increase its value,” he added.

Zghier called for promoting the award at the regional level in addition to setting standards for distinguishing the producer from the rest of the competing firms. This would contribute to the award’s recognition in foreign markets.

He further revealed that Royal will compete this year for the grand title of Palestine Prime Exporter Award, indicating that the firm also manufactures nonplastic products, but due to the differences in product measurements, sizes and industrial specifications in other countries, Royal can only export its plastic production.

Zghier said the main challenges hindering his firm’s exporting activities include high electricity prices, security checks on border crossings and the barriers imposed by Israel under the excuse of the products’ possible dual use (civilian and military).

Negib Nasser, the CEO of Bethlehem-based Arts of Carved Stone, told Al-Monitor that his company specializes in stone masonry and carving stones into what resembles pieces of art with the help of engineers.

Nasser said that the company, established in 2014, is a promising one. It was able to export between 30-40% of its gross production within the past two years, thus qualifying it to win the Exporter Award for the “promising firms” category. Like Zghier, Nasser said that the award did not increase his company's exports, which remained the same.

The challenges of exporting, according to Nasser, include the lack of a company representative abroad, rising export fees that influence the product’s end price and the need for more competition opportunities in foreign markets amid the lack of government support to the various economic sectors.

Despite all the challenges facing the Palestinian economy that hinder exports to regional and international markets, Palestinians are keen to confront the challenges with the available options until better solutions are reached, such as Israel's no longer being in control of the crossings that link Palestine to the outside world, thus paving the way for import and export activities with no restrictions.

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