- Title: WEST BANK: Hebron shoe factories see improvements as economy rises
- Date: 12th November 2009
- Summary: GREEN SIGN READING "GALI" VARIOUS OF PEOPLE INSIDE THE SHOP VARIOUS OF GALI SHOES CUSTOMERS LOOKING AT SHOES INTERIOR OF SHOP
- Embargoed: 27th November 2009 12:00
- Keywords:
- Topics: Economic News,Domestic Politics
- Reuters ID: LVA1ZU087S1UB7C9GZLHSTM4K5VG
- Story Text: The shoemaking industry for which the West Bank city of Hebron is famous suffered from Israeli trade and travel restrictions, a stagnant economy and a flood of cheap imports from Asia. But the industry is reviving in a sign of slow economic recovery in parts of the West Bank.
Two-thirds of Hebron's textile workshops closed and 6,000 shoe factory workers lost their jobs in the last eight years, after the Palestinian uprising began in 2000 and Israel subsequently tightened already existing trade and travel restrictions on the Palestinian territories.
But owner of the Tossetti shoe company in Hebron Farhat Siag is staying one step ahead of competitors by supplying his shoes to Israeli shoe shops and, even if the margins are not quite as good, he's also manufacturing other popular brands to the Israeli market.
"I believe that this is a unique industry. We are better than any foreign manufacturer. I can prove my statement," Siaq said.
He said he would have liked to market his shows under his own company name, but could not afford the luxury of abandoning the larger companies which buy his shows and market them under their own name.
"I would have liked to have my name written on my work, so that people would know my name and may name would become famous. But what can I do? This is the situation we're faced with (having to market his work through other companies in order to make a living)," he said.
Israel imposed more stringent sanctions on the West Bank and Gaza Strip when Hamas won control from the Palestinian Fatah group in the 2006 elections, which inflated costs and hurt economic growth.
The sanctions over the years have hurt business, but Tossetti's director hopes that a feeling of solidarity among Palestinians will help increase his sales.
"There are one and a half million Gaza residents. If everyone buys two pairs of shoes annually, this means three million shoes. These three million would provide work in Hebron all year round," explained Siag.
Hebron is the largest Palestinian city and is known for its leather goods and handmade ceramics, but a wave of cheap Chinese goods was the last straw for businessmen already battling the Israeli travel restrictions.
Israel says its network of checkpoints and roadblocks that carve up the West Bank is needed for security reasons. Palestinians say they amount to collective punishment.
China began to open up its economy around 30 years ago, using cheap labour to produce and export huge volumes of inexpensive goods that have undercut local industries in many developing countries.
But for 60 year old Siag, the Chinese products flooding Hebron's market, aren't a particularly big threat to his turnover, because quality and a loyal client base are still valued.
"(The Chinese products) affected our job. It affected us because people who want cheap products, buy cheap products. If someone doesn't have money he can't buy shoes from here. Those who can afford it will buy our shoes because they know that the shoe quality is guaranteed," Siag said.
But not many other business sectors can claim the same hardiness. Competition from cheaper Chinese goods has all but destroyed the manufacturing industry in the Palestinian territories, where the "Made in China" label is a common sight in shops.
The popular Crocs leisure shoes, made by U.S.-based Crocs Inc, sell for 280 shekels (75 US dollars) in Israel but in Hebron, the copycat Chinese-made version goes for just 13 shekels (3 US dollars).
Many Palestinians are making the most of the cheaper goods, turning to the import trade and travelling to China to buy products to sell at home.
Siag's business model follows the money and specifically where people have disposable incomes.
"Five percent of my business is in the West Bank. In Israel, I sell from 75-80 percent of my products. I sell Gaza 15 percent," he told Reuters.
Israeli company 'Gali' is one of Siag's main clients and their partnership is symbiotic. The Tossetti factory manufactures Gali's shoe designs while Gali sells Siag the raw materials. - Copyright Holder: REUTERS
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