Truck by truck, Israel builds trade gateway to Arab world

Published July 2, 2014
The trade is growing enough to encourage long-held Israeli hopes that the Jewish state can become a commercial gateway to the Arab world. — Photo by Reuters
The trade is growing enough to encourage long-held Israeli hopes that the Jewish state can become a commercial gateway to the Arab world. — Photo by Reuters

HAIFA: The hydraulic ramp of a Turkish freighter taps down on the eastern Mediterranean port of Haifa and, under a full moon, 37 trucks roll off onto an otherwise empty pier. In a convoy that stretches hundreds of metres, the trucks travel east across northern Israel, bringing goods from Europe to customers in Jordan and beyond.

Until three years ago the cargo these trucks carry — fruits, cheese, raw material for the textile industry, spare parts, and second-hand trucks — would have come through Syria. But civil war has made that journey too perilous. “Too much problems, too much guns, too much fighting,” said Ismail Hamad, a 58-year-old Romanian driver. Hamad has driven through Syria for three decades, he said; now, only Israel.

Three years after Syria plunged into violence, Israel is reaping an unlikely economic benefit. The number of trucks crossing between Israel and Jordan has jumped some 300 per cent since 2011, to 10,589 trucks a year, according to the Israel Airports Authority. In particular, exports from Turkey — food, steel, machinery and medicine — have begun to flow through Israel and across the Sheikh Hussein Bridge to Jordan and a few Arab neighbours.

The trade, though still small, is growing enough to encourage long-held Israeli hopes that the Jewish state can become a commercial gateway to the Arab world. Israel plans to invest at least six billion shekels ($1.7 billion) in infrastructure over the next six years to improve the trade route. In the past, some Israeli businessmen and diplomats have lamented the way politics have hurt economic opportunities; others have kept any trade with their Arab neighbours quiet so as not to upset them. Now they see a chance to boost economic and political relations. “Israel is returning to its historic role, as a transit country, as a bridge between continents, where historic trade routes passed through,” said Yael Ravia-Zadok, head of the Middle Eastern Economic Affairs Bureau in Israel’s Foreign Ministry.

The logic is simple: goods from Europe and elsewhere destined for the wider Middle East are usually unloaded in Egypt before they make the several-hour drive to a Red Sea port, where they are loaded onto new vessels and shipped to their final destination. The routes from Haifa in Israel to Jordan, Iraq and even Saudi Arabia — used by the Ottoman and British empires up until Israel’s founding — are potentially much quicker and cheaper, shaving days, if not more, off a trip between Turkey and Baghdad, for instance. Costs could be cut in half.

But Israel’s gain, small though it may be, is far more surprising because countries such as Saudi Arabia and Iraq spurn official relations with Tel Aviv. “A lot of secrecy still surrounds the topic and it is probably premature to speak of a blossoming and fast-growing trade route,” said Coline Schep, a Middle East analyst. She nevertheless described the traffic through the Haifa-Jordan River Crossing trade corridor over the past two years as “almost unprecedented”.

David Behrisch, managing partner at an Israeli shipping agency, says business sprang to life in 2011 when organisers of the Jordan Rally found they couldn’t bring race cars in from Italy through Syria. As the number of motor vehicles crossing from Turkey into Syria plummeted — by close to 50 per cent. Most of the trade was diverted to Egypt. But thanks to a new Turkish route by sea to Haifa, some shipments also began crossing through Israel.


Hurdles


Plenty of political and practical obstacles remain. The port in Haifa is state-owned and has limited capacity, a history of labour unrest and cumbersome security. Freighters in Haifa bay are typically forced to wait hours to dock. Trucks and containers have to pass through Israel’s lengthy security checks and scanners. The drivers, carrying international permits, meet passport agents onboard. Only after that can they take to the roads.

Return cargoes from the Arab world into Israel are inspected with even greater scrutiny. This is perhaps the weakest link in the trade route. Merchants say they could easily sell more from the Arab world through Israel were it not for Israel’s security procedures. Only 90 or so trucks from Jordan can cross the Sheikh Hussein Bridge each day and they routinely wait all day while Israeli officials check their contents.

Shlomi Fogel, owner of the Haifa-based Israel Shipyards, is working to ease that strain. He wants to expand a free trade zone called the Jordan Gateway, which sits six kilometres south of the Sheikh Hussein Bridge and straddles the Israel-Jordan border. — Reuters

Published in Dawn, July 2nd, 2014

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