AL-BIREH, West Bank, 12 August 2004 — Faced with the lopsided Oslo peace accords, Palestinians attempted to overcome tremendous odds over the last ten years to sow the seeds of a modern economy. However, Israel had different plans, namely to manipulate the uneven balance of power to eliminate any possibility for Palestinian self-sufficiency and the emergence of a Palestinian state. Mixing the greed of the corporate world with the might of the Israeli military, Israel is well on track to undermine Palestinian achievements, and by doing so, the occupying power has wrecked the Palestinian society with severe consequences that will last for many years.
Typical is Israel’s attempt to strangle the growth of telecommunications sector — the one sector is proving to be the vehicle that is prodding governments around the world to modernize and become more transparent, accountable and market-driven.
In Israel, for a population of 6.5 million, there are over 5 million fixed lines, over 6 million cellular subscribers, and a highly competitive market with four cellular operators — three of them with US multinational firms holding majority equity. The Palestinian market is in its infancy. Israel refuses to abide by the provisions in the Oslo peace accords that gave Palestinians full control over their telecommunications sector. Israel is allowing its cellular operators to operate within the Palestinian cities and towns in clear violation of the Oslo agreement and in blunt disregard to internationally recognized agreements, including the World Trade Organization treaties to which Israel is a signatory.
Not only are all of the Israeli cellular companies illegally operating in Palestinian areas without licenses, but also the Israeli government is encouraging them by disrupting the ability of the Palestinians to develop their own telecommunications networks and refusing to take action against these Israeli operators for violating agreements. These Israeli commercial interests are fully aligned with Tel Aviv’s political concerns and the military occupation works in tandem with policies aimed at de-developing the Palestinian economy.
So Israel refuses to allow the Palestinian cellular operator to import desperately needed equipment. Since all Palestinian imports must pass through Israeli ports, Israel has repeatedly used the infamous, all encompassing blanket excuse of “security concerns” to delay or prohibit Palestinian imports. While the same equipment that is destined for Palestine is being held up at Israeli ports for “security checks”, Israel allows it to be freely imported by Israeli operators. Furthermore, Israeli cellular operators have installed a comprehensive network covering the entire Palestinian area. These firms place their equipment inside the illegal Israeli settlements, under the pretext of serving the settlers, but in reality position their equipment and provide it with excess capacity to cover every Palestinian community. This is easily done as the settlements are usually located on the hilltops next to Palestinian population centers and are well protected by Israel’s military occupation forces.
Israeli companies have also flooded the Palestinian marketplace with pre-paid scratch cards to market their services.
The motivation of the Israeli government is clear. To them, denying the Palestinians the ability to develop their communications market is consistent with continuing the military occupation and sabotaging Palestinian efforts to develop an independent economy. In addition, there are many hints that corruption within Israel may explain the Israeli government policies that hinder equipment importation to Palestine.
The Palestinian economy has been wrecked during the second intifada by draconian measures and deliberate destruction. The illegal Israeli operators compound these destructive measures and have become an integral part of the Israeli occupation of the West Bank and Gaza Strip.
First, the Palestinian government does not collect taxes on the activities of these illegal telecommunications operators. It is estimated that over $40 million of tax revenue has been lost thus far. While the international donor community, led by the European Union and United States, continue to drip-feed “development” funds into Palestine, they ignore the fact that these lost tax revenues could have reduced the Palestinian dependence on international donors. Second, an estimated $500 million of Palestinian funds were drained out of its economy by such operations.
Further compounding the problems facing the Palestinian operators are the dumping practices used by these illegal service providers. Palestinians consumers are offered telecom services at less than a third of the cost as consumers living in Israel. This price discrimination and dumping is injurious to Palestinian operators who are further placed at a disadvantage. The entire Palestinian communications market is damaged by such developments. While elsewhere in the world telecommunications have provided a tremendous economic stimulus, Palestinians are hindered from developing this key sector, and having the opportunity to create an alternative to the wrecked economy caused by the 37-years of military occupation.
Added to this is the fact that the Israeli military has damaged the offices of the Palestinian operators and has confiscated network equipments, records and mobile handsets. In addition, dozens of Palestinian engineers have been detained arbitrarily in Israeli military prisons. These telecommunication operators clearly violate accepted norms of conducting business, they violate international law, and they violate the letter and the spirit of the signed treaties.
— Sam Bahour is a Palestinian-American businessman living in the besieged Palestinian city of Al-Bireh in the West Bank and can be reached at [email protected].