Israel: South Africa's desire to label West Bank goods is 'racist'

In the 45 years since gaining control of the West Bank, Israel has refrained from formally annexing the territory claimed by the Palestinians, in part out of fear of an international uproar. In trade, however, Israel has been labeling goods from Jewish settlements there as “Made in Israel” for years.

Now South Africa says it wants retailers of Israeli exports to designate products from the settlements – considered illegal by most of the international community – as made in the “occupied West Bank,” a decision that some here fear could lead to a cascade of similar international efforts.

Indeed, South Africa's decision last week was followed by the government of Denmark within days, and has outraged Israeli officials who criticized the labeling rules as a “racist" step on the way to boycotting settlement products.

So far, international efforts to boycott settlement businesses have found little success. And while analysts say the move is unlikely to hurt Israel economically – West Bank industry is a fraction of the overall economy – the policy has the potential isolate Israel diplomatically if other countries follow suit.

“When people are asking, 'is it from the territories, is not?' It’s mostly a political blow, not an economic blow,” says Alon Liel, a former director general of the Israeli Foreign Ministry. "Because of South Africa’s history of apartheid, it attracts attention regarding the legality of the settlements and fixes attention on the 'A’ word. That is very meaningful because Israel has a soft belly here.”

Palestinian officials welcomed the move as another lever to pressure Israel into halting expansion of Jewish settlements in the West Bank, a bone of contention which has stymied peace negotiations for more than a year and a half.

Boycott coming?

The move also raises fears that it will morph into a general boycott of all Israeli products – a stated goal of the Palestinian “Boycott, Divestment, and Sanctions" (BDS) movement.

A spokesman for the South African Embassy in Israel denied that the move amounts to a boycott because the country is not banning the import of products from the Jewish settlements. That said, the South African government wants to give citizens the option to avoid West Bank goods with transparent labeling.

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