Zvi Oren, president of the Manufacturers Association of Israel, called on Sunday for closer ties between Israeli and Palestinian businesses as a means of enhancing the prospects for peace, saying that coercive boycotts would only make the situation worse.
“The economy should be used as an incentive for regional development, not as a punishment,” he wrote in two separate letters sent to 30 business leaders in Europe and the Palestinian Authority. “Cooperation between Israeli business people and Palestinian business people will lead to a situation where the economy and people shape reality, and not the opposite.”
Any attempts to boycott Israel, he said, would be a serious mistake that would hurt the prospects of peace.
“As someone who knows the labor market in Israel and the Palestinian Authority, and is well aware of the number of jobs that depend on regular production of products in the territories, I cannot remain indifferent to calls for boycott and sanction of these products abroad,” he wrote in the letter to the Palestinians.
He implored the Europeans not to use coercive means that would negatively affect growth “on both sides.”
Since Operation Protective Edge was launched in early July, anti-Israel groups have stepped up calls to boycott goods from the Jewish state.
At the same time, the European Union said that, as of September 1, it would no longer import Israeli eggs, meat, poultry and dairy from areas beyond the Green Line. The EU said it does not recognize Israeli authority on any of the territory beyond the pre-1967 armistice lines, which include the West Bank, east Jerusalem and the Golan Heights, so its certification of products from those areas would not be accepted.
Those areas account for about 4 percent of Israel’s GDP, though they include about 10% of the population, according to the OECD.
In January, the finance minister warned of a creeping boycott from European consumers.
“If we do not stop it, there will be a series of events that will appear unrelated to us, but will eventually meld into one coherent process that will leave Israel’s economy outside the world economy and will lead to a drop in the standard of living here,” he said.
Though there is little evidence consumer boycotts are having any influence on the economy thus far, the Finance Ministry estimated that if a boycott reduced exports to Europe by one-fifth and stopped the continent’s foreign direct investment in Israel, GDP would fall by NIS 11b. a year, or about 1.1% of GDP, and 9,800 people would lose jobs.