Palestinian businesses look east to China

By Wafa Amr

HEBRON, West Bank (Reuters) - Faced with Israeli trade and travel restrictions, a stagnant economy and a flood of cheap imports from Asia, Palestinian businessmen are increasingly seeking their fortunes in China.

Demand for Chinese visas among business owners in the occupied West Bank is so high that the Chinese consul regularly visits the city of Hebron to stamp their passports and circumvent an Israeli ban that prevents them from traveling to the embassy in Tel Aviv.

"Everybody is doing business in China," Khaled Oseily, businessman and mayor of Hebron, told Reuters. "The Chinese consul comes to Hebron and on one day issued some 600 to 700 visas to Hebronite businessmen."

China began to open up its economy around 30 years ago, using cheap labor to produce and export huge volumes of inexpensive goods that have undercut local industries in many developing countries.

In Hebron, the largest Palestinian city famous for its leather and handmade ceramics, the wave of cheap Chinese goods was the last straw for businessmen already battling Israeli travel restrictions that inflate costs and hurt economic growth.

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.

On Sunday, Israel said it would remove about 50 "dirt roadblocks" in the West Bank and open a "permanent checkpoint" that obstructs the flow of travelers to the town of Jericho.

Western and Palestinian officials said Israel had pledged in the past to remove West Bank barriers but failed to do so.

Meanwhile, many Palestinians have turned to the import trade, traveling to China to buy cheap goods to sell at home.

Increasingly, and amid doubts peace talks with Israel will yield a deal for an independent Palestinian state soon, they are opting to stay.

"Economic conditions in Palestine are very bad," said Hazem Shyoukhi, a gift merchant from Hebron who moved to the eastern Chinese city of Yiwu in 2006 to start an export business.

"There (in Hebron) we conducted our business based on news reports," he told Reuters by phone from Yiwu. "I had to listen to the newscast to check if there was a closure ... I worked under pressure merely to survive, so I decided to leave."

"MADE IN CHINA"

China, which since the end of the Cold War has turned to the Middle East for half of its oil imports, is not just linked to the region by trade. Beijing has sought a bigger political role in the Middle East and has appointed an envoy to the Arab-Israeli peace process.

Palestinian diplomat Ahmad Kayed, who lives in Beijing, said in the past 10 years, more than 200 Palestinian businessmen had settled in China, but thousands of other Palestinian and Arab businessmen were frequent travelers to Chinese cities for trade.