For ten years, pro-Palestine activists have attempted to push back at Israel’s expansion into the West Bank by taking a stand against the companies doing business there. The popularity of the Boycott, Divestment, and Sanctions movement — or BDS — reached new heights last year with the 50-day long conflict between Israel and the militant Palestinian political organization, Hamas. As evidenced by a Congressional hearing on the topic last month, many on either side of the debate have their reservations about the boycott effort’s ethics and efficacy.
BDS, which bills itself as “a truly global movement against Israeli Apartheid,” began in July 2005 when nearly 30 Palestinian civil society organizations issued a call to action to impose broad boycotts and implement divestment initiatives against Israel similar to those applied to South Africa in the apartheid era. In the intervening decade, the effort has grown into a real threat to the Israeli economy since it started a decade ago. Some have even described BDS as “an existential threat to the Jewish state.”
Drawing its strategy in large part from the Anti-Apartheid Movement, BDS’ stated aims are to pressure Israel into ceding to three demands: the end of occupation of Palestinian territories according to the 1967 borders, equal treatment of Palestinian citizens of Israel, and, most controversially, the right of return for Palestinian refugees as per the United Nations’ Resolution 194.
Even if those demands are unlikely to be met anytime soon, the boycotts and protests have forced Israeli officials and business owners to take BDS seriously.
“There is absolutely no doubt that our reputation as individuals and as a company was compromised because of our association with the lies and allegations directed at us from the BDS,” Daniel Birnbaum, the head of SodaStream, said during the hearing before the House Oversight Committee.
Even so, he maintained the decision to move its factory from Israeli-occupied territory in the West Bank was part of a “global restructuring” effort and not the result of protests. Birnbaum was also hesitant to attribute a 42 percent decline in U.S. sales to boycott efforts, although BDS claims credit for the company’s falling profits.
Other companies have denied BDS’ claims of their involvement with Israel, amid growing pressure from the movement.
Barclays, a London-based bank, denied BDS’ allegations that it had invested heavily in Elbit System, a defense company that provide arms to Israel. Despite that, nearly 1.8 million people signed on to a petition calling for the bank to divest from the company and protesters shut down branches across the country in November.
While it’s difficult to measure the movement’s economic impact given competing claims on investments and the many variables that impact a company’s earnings, the threat BDS poses is one Israeli officials are not taking lightly. Not least because of the support that several European countries have thrown behind the movement.
Twelve European Union countries warned their citizens against working with or investing in companies operating in Israeli settlements calling them “illegal under international law.” In April, 16 European foreign ministers signed a letter urging European Union officials to mark products made in Israeli settlements in the West Bank to be labeled differently from those made in Israel.
Such appeals are ones that Yair Lapid addressed bluntly when he was Finance Minister of Israel.
“When you say to Israelis ‘European boycott,’ they think it means that this year they won’t get Camembert cheese on time,” he said at a security conference last year last year. “That is not the case.”
Lapid has put the cost of even a 20 percent decline in Israeli exports to the European Union at $5.7 billion a year.
“If the negotiations with the Palestinians get stuck or break down and we enter a reality of a European boycott, even a very partial one,” Lapid continued, “Israel’s economy will retreat backward and every Israeli citizen will feel it straight in the pocket.”
So BDS has begun to hold some sway over policy discussions.
“The risks are very high for Israel,” Secretary of State John Kerry said following a breakdown Israeli-Palestinian peace talks last February. “People are talking about [a] boycott. That will intensify in the case of failure [to broker peace].”
But, after sharp criticism from American legislators, Kerry clarified his own stance on boycotting Israeli businesses and investors. In a keynote address at the AIPAC conference in March, he said, “In order for Israel to continue thriving economically, we must also stand together and with a single voice reject arbitrary and unwarranted boycotts of Israel.”
“For more than 30 years, I have staunchly, loudly, and unapologetically opposed boycotts of Israel,” Kerry continued, “And I will continue to staunchly, loudly and unapologetically oppose boycotts of Israel. That will never change.”
Given the sort of scrutiny that Secretary of State Kerry faced when he so much as mentioned the possibility of a boycott, the BDS movement can’t expect much support from the U.S. Israel has been the largest recipient of foreign aid from the U.S. since World War II. It’s received a staggering $124.3 billion to date in today’s dollars. And, as many critics of the unfaltering U.S.-Israel alliance have pointed out, the U.S. has only given more to Israel amid its criticisms of the Iran nuclear deal. That suggests that the U.S., for its part, will continue to support Israel even when their policy objectives are at odds.
The U.S. has not, however, taken a formal position on the BDS movement. That was the stated aim of last month’s Congressional hearing, although as some noted, it didn’t feature any real proponents of the boycott effort.
Instead, three out of four of those asked to testify were known opponents of BDS.
In his testimony Birnbaum, the head of SodaStream, said BDS employed “tactics of political warfare” and stems from an “ideology is grounded in the hate for the Jewish state, founded upon blatant lies and half-truths.”
He also questioned how pressure to remove a factory from the West Bank was beneficial to Palestinian workers who would lose their jobs.
“It’s of dubious morality to hold the Jewish state to a standard to which you hold no one else,” Mark Regev, a spokesperson for Israeli President Benjamin Netanyahu, said. “Are you boycotting any other place of disputed sovereignty on the planet, or are you picking and choosing your moral outrage?” He alleged an unfair bias in critique of Israeli policies, claiming that people “are being very selective with their indignation, and it fits into certain cultural prejudices.”
But to Omar Barghouti, who helped found the BDS campaign in 2005, it’s not about boycotting people, but rather “boycotting something — an act, a company, a business — that you disagree with.”
The campaign makes clear that it is “inspired by the struggle of South Africans against apartheid,” but it has a long way to go and many roadblocks to navigate before it can have anywhere near the impact of the Anti-Apartheid Movement.
Boycotts of corporations and divestment from Israel are not to be underestimated, but, as many historians have noted, the Anti-Apartheid Movement drew its most critical support from state actors — especially the U.S. government — who essentially forced the hand of private investors away from South Africa.
It was only when the U.S. became serious about the possibility of government enforced economic sanctions that “Disengagement became a self-interested option for risk-averse managers,” Kenneth A. Rodman, a professor of government, explained. That is, investors’ temptation to “buy low” in an already flailing economy was totally quashed by the threat that South African businesses would only tank if kept from exporting their goods because of sanctions.
But financial strain from divestment alone didn’t singlehandedly ring the death knell of Apartheid in South Africa. “Popular pressure led institutional investors to challenge the morality of profits obtained from collaboration with the repressive apartheid regime,” Cecelie Counts, a former Anti-Apartheid activist wrote in a New York Times op-ed. Divestment was only one part of “a very broad and well engaged struggle on a variety of fronts.”
Israel doesn’t have the same financial stake in the well-being of Palestinians who are not nearly as integrated into the Israeli economy as the black South Africans before Apartheid ended there in 1991. Unemployment is at a staggering 75 percent in the West Bank and Gaza, and only one in ten Palestinians over the age of 15 are employed in Israel or its settlements.
With the amount of support from foreign governments that Israel continues to receive along with its own booming economy, the BDS movement has a long way to go before it can influence Israeli policy towards Palestinian territory.