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Goods from occupied lands should not be part of trade deal with Israel

The Star, Toronto

Goods from occupied lands should not be part of trade deal with Israel

21 May 2012

By Said Hamad

This creates an opportune time to fix a loophole in the existing free trade agreement to ensure Canada’s compliance with its own foreign policy as well as its international obligations.

As with any free trade agreement, CIFTA is intended to promote trade between the countries that are party to the agreement, in this case, Canada and Israel. The trouble with CIFTA is that it extends preferential trade treatment, including lower tariffs, to goods produced in Israeli settlements located within occupied Palestinian territory as if they were made in Israel. In other words, a loophole in CIFTA treats Israeli-occupied territory as if it is Israeli sovereign territory.

So what’s the big deal ?

Canada’s official policy, as stated on the Ministry of Foreign Affairs website, provides : “Israeli settlements in the occupied territories are a violation of the Fourth Geneva Convention. The settlements also constitute a serious obstacle to achieving a comprehensive, just and lasting peace.” If, as a matter of Canadian policy, settlements are unlawful, there should be no objection to excluding the forbidden fruits of the settlement enterprise.

Yet Canada not only grants these illegal goods access to its markets, but it also extends them the full benefits of free trade underwritten by Canadian tax dollars. Where do these rewards and profits go ? Right back into the settlements that ostensibly offend Canadian foreign policy. In essence, Canadian tax dollars are unwittingly used to subsidize unlawful settlements.

Settlement goods range from cosmetic products and chemicals to industrial and agricultural goods. Many of the offending products have been identified by third parties such as What these products have in common is that they are all derived from factories or farms illegally built on confiscated Palestinian land, exploit scarce Palestinian water resources, and are not even held to the same environmental standards as businesses inside Israel.

The full extent of the settler economy is not known because the Israeli government only publishes aggregate GDP data for Israel and the settlements. However, estimates put the annual value of settlement exports at hundreds of millions of dollars.

Since CIFTA came into force in 1997, trade between Canada and Israel and the settlements jumped from $507 million to $1.4 billion in 2010. Meanwhile, the Palestinian economy has suffocated under the burden of the occupation and the settlements. Due to closures and movement restrictions imposed by a military occupation and artificially created scarcity of land and water, the result is that rent and land prices, as well as energy, transportation and labour costs are more expensive for Palestinian businesses — sometimes prohibitively so.

If I were a Canadian producer or consumer, I would find the loophole for settlement goods to be morally if not legally objectionable. The loophole creates unfair competition for law-abiding Canadian producers who shouldn’t have to compete with illegal settlement goods at all. And Canadian consumers deserve better choices. Mislabelling products as “Made in Israel” prevents consumers from making informed and ethical choices.

The right thing to do — the Canadian thing to do — is to ensure that the Ministry of International Trade closes the loophole in the upcoming upgrade. Any free trade benefits should be limited to the intended goods made in Tel Aviv, Nazareth and other places inside Israel. Countries in Europe and South America have taken steps to do so in their respective free trade agreements with Israel and serve as useful precedents for the Canadian ministry to consider.

The stagnating peace process is on the verge of imploding primarily because of the ever-expanding settlement enterprise. With the international community hard-pressed to persuade Israel to end its unhealthy addiction to settlement growth, Canada’s decision to continue rewarding illegal settlement products creates an unfortunate perception that Canada is playing the role of enabler for Israel’s addiction.

In the end, the settlement loophole for free trade benefits will ensure Canada’s compliance with its own foreign policy on settlements, uphold Canada’s international legal obligations, and will ultimately have a salutary effect on the pursuit of peace between Israelis and Palestinians.

Ambassador Said Hamad is the representative for the Palestinian General Delegation to Canada.