Fingering the Goods

Why does Canada give settlers sweet trade deal?


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While Israeli peaceniks boycott goods coming out of illegal Jewish settlements in the Occupied Territories, Canada has been rewarding these same products with favoured trade status.That’s more than a little curious, since Canada officially opposes the Israeli occupation of the West Bank, Gaza, Golan Heights and East Jerusalem, as well as the establishment of Jewish settlements in those territories.

Our federal government supposedly considers the settlements “contrary to international law and unproductive for the peace process.”

However, the 1997 Canada-Israel Free Trade Agreement (CIFTA) makes absolutely no distinction between goods made in these Jewish settlements and those made in Israel. In fact, under CIFTA, goods made in the illegal settlements enjoy the same duty-free status conferred on products made in the Palestinian Authority. (The PA basically signed onto CIFTA two years after it was ratified by Israel and Canada.)

CIFTA tersely defines Israeli territory as “where its customs laws are applied.”

Gush Shalom, the Israeli peace group opposed to the occupation, has been putting pressure on Ariel Sharon’s government through a boycott campaign aimed at settlement goods.

Such products are already excluded from the European Union’s free trade agreement with Israel. In fact, the EU has been pressuring Israel to label the origin of goods coming out of the settlements.

Gush Shalom spokesperson Adam Keller tells NOW in a telephone interview from Tel Aviv that, as well as weakening the settlements economically, the campaign is aimed at raising the consciousness of the 20 per cent of the Israeli population who he says believe the occupation is wrong.

“Very many of them are not carrying their principles with them when they go to the supermarkets,” says Keller.

Gush Shalom has posted an extensive list of settlement-manufactured goods on its Web site (www.gush-shalom.org).

NOW was able to track down two products on the list that are now being sold right here in the GTA.

The LCBO stocks wines produced by the Golan Heights Winery, which is located in the Katzrin settlement there.

As well, Ahava cosmetics, which are sold across Canada, are manufactured in the Dead Sea-side settlement of Mitzpe Shalem on the West Bank.

Despite this glaring inconsistency in its foreign policy, Canada has no intention of amending CIFTA to strip settlement goods of their preferred-trade status.

“We just celebrated the five-year anniversary of this agreement,” says Department of Foreign Affairs and International Trade (DFAIT) spokesperson Sameer Ahmed. “We think it works well.”

In fact, Canada has no problem keeping trade and political policy on Israel mutually exclusive.

“The political stance (on the Occupied Territories) is always there. It remains the same,” says Ahmed, who adds, “For trading purposes and technical purposes, we do not possess the means to make that differentiation (between Israeli-made and settlement-made goods) and do not really want to make that differentiation.”

The government may be happy with the agreement as it is, but in April, Bloc Quebecois MP Pierre Paquette introduced a private member’s bill calling on Canada to amend CIFTA to exclude settlement goods from the list of products entitled to lower duty rates.

“There is no definition of (Israel’s free trade) territory (in CIFTA),” Paquette tells NOW. “But in my mind, I think it’s clear that it’s only the official territory recognized by the international community.”

While Canada’s contradictory positions may be mind-boggling, even the Europeans, who exclude settlement goods from their free trade agreement with Israel, are having trouble enforcing the policy.

“Israel absolutely refuses to differentiate goods, and the Europeans raise it to the point of saying, “Well, if that’s true, we’re going to have to consider all your labelling false and therefore effectively terminate the free trade agreement,'” explains McGill University professor Rex Brynen, who studies the region. “But the Europeans rapidly back down from that every time they raise it.”

The U.S., which also opposes the settlements, has had a free trade agreement with Israel since the 1980s. Like Canada, the U.S. makes no distinction between Israeli- and settlement-made goods.

“The U.S. doesn’t look behind the “made in Israel’ label,” says Philip Wilcox, president of the Washington-based Foundation for Middle East Peace. “If someone wanted to raise it in court, I think a strong case could be made that the (U.S.) free trade agreement certainly does not include goods made in the Occupied Territories.”

Some observers note that the amount of goods coming out of the settlements is marginal. Again, DFAIT doesn’t break it down.

But since the free trade agreement came into effect, total exports from Israel to Canada have increased by 43 per cent, DFAIT statistics show.

In 2001, the overall value of exports from Israel to Canada totalled $343 million. However, as of this April, Israel had exported only a total of $109 million in goods to Canada that’s down 16 per cent over the last 12 months.

Israel’s main exports to Canada include industrial diamonds, machinery and electrical equipment.

Activists say a boycott still raises the profile of the illegality of the settlements.

Nahla Abdo, a sociology professor at Carleton University who is also a Palestinian and a member of Women Against the Occupation, says activists here are only beginning to track Canada’s trade with and investments in Israel. According to Abdo, that may lead to a full-fledged divestment campaign aimed at Israel.

In a statement faxed to NOW, the Israeli embassy says the EU has not made a formal request to label goods manufactured in the settlements.

As well, the embassy maintains that “we are against any political pressure that uses economic instruments as a political tactic, such as boycotting Israeli products in general… or selected boycotts such as this one.” It goes on to state that “both communities jointly agreed that areas of the Palestinian Authority and Israel would be considered one economic zone.”scottand@nowtoronto.com

Research assistance by Nadia Daniell and Martha Lai

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