Boycott Israel as Long as it’s Convenient

The Arab world’s boycott of Israel, including the original version by the League of Arab Nations, as well as the newer Boycott, Divestment and Sanctions (BDS) movement, seem to be nothing more than a PR stunt, not meant to damage Israel’s economy.

Advocates of Israel boycotts generally advise others to act against Israel, even when they themselves are not willing to do so.

The Arab League boycott of Israel, starting even before Israel declared independence in 1948, was at one time effective in harming the Israeli economy.  In the early days, many international companies decided to abide by the call to boycott Israel in order to have commercial access to the much larger Arab market.

If you visited Israel 50 years ago, you would see a great deal of Subaru cars and Coca Cola, but not many other Japanese cars and no Pepsi.  Why? Because Coke and Subaru decided to ignore the Arab League boycott and sell in Israel, while many other companies adhered to the Arab League boycott, choosing financial gain over a more principled business decision.  When I made aliyah, the first car I bought in Israel was a Subaru, partially as a way of thanking this company for not bowing to the huge financial pressure and instead being present in the Israeli market for many years.

In 1977, the United States passed a law which made it a criminal offense to adhere to the Arab League boycott of Israel and imposed fines on American companies that were found to be complying with it, effectively removing from most companies the incentive to comply with the boycott.

Yet a few days ago it was reported that Arab League strengthened their boycott of companies that support Israel, even though it is clear that it will have no measurable negative impact on Israel’s economy.

Let’s take a closer look at what the Arab League actually is.  According to their website, there are 22 members, including: Bahrain, Egypt, Jordan, Morocco, Palestine and the United Arab Emirates (UAE).

Egypt and Jordan have long-standing peace agreements with Israel.  In 2022, according to the UN, Israel trade figures with Egypt was $308M and with Jordan $536M.

UAE, Bahrain and Morocco signed normalization agreements with Israel as part of the Abraham Accords in 2020.  According to the United Nations, trade in 2022 between Israel and UAE was $2.2B, with Bahrain $12M and with Morocco $56M.  The US Department of Commerce reported that the UAE terminated their participation in the Arab League’s boycott.

And let’s not forget about the Palestinian Authority.  According to the US International Trade Administration, in 2022 Palestinian imports from Israel were $4.64 Billion and exports were $1.40 Billion.

So the Arab League, rather than focus their sights on their members engaged in billions of dollars of trade with Israel, instead turns a blind eye and offers directives to others to boycott Israel, something that US law has effectively made toothless in any case.

Now let’s turn from the Arab League boycotts to those advocated by the BDS Movement.

The financial impact of BDS boycotts of Israel remains negligible; until the war with Gaza that started in 10/2023, Israel’s economy was booming.  Instead, this boycott can only theoretically impact Israel’s international reputation.   While a positive perception of Israel may be reduced by those calling for boycotts of Israel, there is a second side to this issue.  Almost 40 states have anti-BDS laws meant to protect their citizens from supporting those that engage in such a discriminatory boycott of Israel.  Penalties for violating anti-BDS laws include states divesting and/or not entering into business agreements with offenders.  So those that boycott are also ostracized and financially targeted.

We can look at public instances over the years in which companies were pressured by BDS activists to announce boycotts of Israel, Airbnb and Ben & Jerry’s (Unilever subsidiary).  Neither corporation ultimately went through with the boycott. Instead, after they experienced reputational and financial hits for making a business decision to engage in a biased boycott, including Unilever’s stock performing very poorly compared to similar companies in their industry, and lawsuits abounding against both of these companies, each of them found a way to revoke the boycott, in order to improve their bottom lines and their public stature.

Equally interesting, there is an app that purports to be a resource for those interested in identifying and boycotting Israel-related products.  I have no idea how the app’s creators decide which products to recommend for boycott.  But one thing is certain, unique products of medical breakthroughs originating in Israel, whether pharmaceuticals or equipment like heart stents or medical digestible cameras, are not being boycotted.  Technology developed in Israel, whether embedded in cell phones or laptops, are also absolutely not targeted.  If a product is produced in Israel and is critical for quality of life, or even simply inconvenient to do without, BDS activists ignore it as a boycott target.

When it is clear for all to see that even those advocating for a boycott of Israel don’t take it seriously, it is no wonder that these discriminatory Israel boycotts are doomed to the dung heap of history.