The political economy of the West Bank 1967-1987: from peripheralisation to development - Adel Samara

An Israeli soldier watches Palestinians flee to Jordan from the West Bank, 1967.
An Israeli soldier watches Palestinians flee to Jordan from the West Bank, 1967.

Discussion on the general features of the political economy of the West Bank from 1967 to 1987 and how the Israeli state has both destroyed and transformed it.

Submitted by Ed on June 9, 2014

THE ECONOMIC RELATIONS between countries are relations of exchange, rather than of production. The exchange relations between Israel and the West Bank are not standard 'centre-periphery' relations despite the fact that both are integrated into the world order. Since 1967, when the Israeli authorities assumed political control, the West Bank has been peripheralized to a settler-colonial capitalist economy. Israel has not annexed the West Bank politically but adopted another alternative - the uprooting and destruction of the West Bank's economic production structure, characterised by the expropriation of land and the expulsion of large numbers of indigenous inhabitants.

The unique relations between Israeli settler colonialism and the West Bank cannot be described as internal colonialism despite features common to both. Neither does it fit with Wolpe's model of internal colonialism in South Africa1 which describes the articulation between modes of production as an extension of the capitalist mode of production at the expense of non-capitalist modes of production. The 'articulation approach' asserts that peripheral social formations are constituted by the articulated combination of the dominant capitalist mode of production and subordinate, non-capitalist modes of production.

But the relation between the Israeli economy and the West Bank is a relation between two separate economies, between a developed capitalist mode of production dominant in one and a controlled peripheral capitalist mode in the other. In this case, the relation is an external and settler colonial one.

The social formation of the West Bank has been a peripheral capitalist one since the Jordanian era when the capitalist transformation was implanted. The arbitrary peripheralization of the West Bank economy to Jordan's and the orientation of its production towards export, which drained it of its surplus and hindered internal accumulation, has stunted the home market and, in the end, blocked its economic development.

Wolpe conceives of articulation as an expression of the coexistence or combination of two modes of production (an expanded dominant mode and a restricted subordinate mode. The 'expanded mode' comprises relations of production, forces of production and a general law of motion, whereas the 'restricted mode' comprises relations of production and forces of production only. Wolpe maintains that within articulation literature in general the reference is to the 'expanded' capitalist mode of production only. This mode is characterised as being dynamic and capable of reproducing itself on an expanded scale. For the 'restricted mode' to be capable of reproducing itself, Wolpe argues that, 'concepts like "circulation" or the "state" have to be introduced. Without these concepts the restricted cannot be changed to be expanded.'2

Wolpe conceptualizes the peasantry as 'individual and isolated enterprises'. These individual and isolated enterprises are passive and resistant to any capitalist transition. Any capitalist transition must be imposed from outside. This imposition is the only way to break the peasantry's passiveness and resistance. Cardoso notes that:

Contemporary "dependent capitalist development" in certain Latin American countries, notably Argentina, Brazil and Mexico, produces an 'internal structural fragmentation' in which the "advanced" sectors are internalized and hence integrated with the new forms of monopolistic expansion of capitalist world economy. Other, more' 'backward" sectors producing essential urban wage-goods, such as urban petty commodity production but especially staple agricultural products, are characterized as "internal colonies", in their relations with the internationalized sectors. Thus a "new structural dualling" is the counterpart of the structural dynamism of "associated-dependent-development"; it results directly . . . from capitalist expansion and is functional to that expansion, insofar as it helps to keep wages at a low level and diminishes political pressure inside the' 'modern sector".3

In the case of the West Bank, the advanced sector is 'agricultural' and is not freely integrated with the capitalist world economy. It is controlled by the Israeli economy which directs the West Bank's externally oriented production to fit Israeli needs and contracts with the world market, and has adapted it to provide Israel with comparative advantages in terms of exchange with the world market.4 Thus the West Bank's externally and internally oriented sectors are colonized by the external Israeli economy. What should be noted here is that the Israeli settler capitalist mode of production works in two integrated phases in respect of the West Bank.

Firstly: It is extended at the cost of the peripheral capitalist mode of production and other non-capitalist modes in the West Bank through a process which could be described as a peripheralization through incorporation. In its early years, the capitalist mode of production of Israeli settler colonialism, enforced by the Israeli military governorate, incorporated the West Bank economy so as to disarticulate its sectors internally. With this policy, the occupation precluded the possibility of independent capitalist development. This was carried out alongside land expropriation which precluded even limited 'fair' agricultural and industrial competition. As Kahan notes: 'In both the regions no support was provided for capital investment directed to the processing of produce in competition with products of Israel (e.g. dairy processing).'5

Secondly: The Israeli settler capitalist mode of production entered a new phase in 1976, one which continues to date: uprooting the productive factors in the West Bank economy-for example larger scale expropriation of land, competing with local industries, arbitrarily increasing taxes and forcing the inhabitants abroad. Briefly, the second phase is peripheralization without articulation or further incorporation of the West Bank's productive economic sectors but rather the beginning of their total destruction as an independent economy. In parallel with the continued weakening of the West Bank's productive sectors, the produce of Israel's big companies has flooded into the West Bank's market. Foodstuff and textile companies involved include Tnuva, Osem, Ketan, Ladizia and others.6

The deliberate Israeli policy of making the West Bank economy dependent is paralleled by another Israeli policy which keeps Israel independent of the West Bank for any vital produce. Any form of dependence would represent a security risk for Israel and it is considered preferable to ensure continuous supply from Israeli sources, even at the cost of possible seasonal excess supply. This was one of the reasons given for subsidies and minimum prices granted to farmers in Israel.7

In both cases, the role of Israeli military force is still the main tool of the two phases of the peripheralization (through military orders for example, which cover all aspects of life). It is not the only tool in the process. Besides the military power of the Israeli authorities, there is unequal exchange imposed through Israeli merchants and capitalists on the one hand, and West Bank merchants on the other. It is the latter mechanism which is discussed in detail here.

Early class collaboration in the West Bank

ISRAELI ECONOMIC ANNEXATION of the West Bank started in the early days of the occupation. The West Bank was denoted a military area at the advent of the occupation in June 1967 and since then Israel has issued well over 2000 military orders and regulations, governing all aspects of life. In particular, the military governorate has promulgated various economic regulations such as the imposition of Israeli currency (military order no 27) and the banning of exports and imports except through Israel (military order no 24). This latter ban, however, is not strictly applied to all produce. Those goods which might compete with Israeli produce are often exempted. Such produce may still be exported across the 'open bridges' into Jordan.

During the first year of the occupation, Israel paved the way to peripheralization of the West Bank; this is clear from the military orders, strategic plans and resulting developments. Following the application of military rule to the West Bank, hundreds of thousands of inhabitants migrated to Jordan, either as emigrants or because of expulsion. This affected the productivity of the economy. Israel outlawed the West Bank's existing import-export relations (orders nos 10-12) during the first few months of the occupation. Since then, local merchants have started marketing Israeli goods or goods imported through Israel. Thus the merchants can be seen as the first social class to become linked to the Israeli economy. Some of these merchants have imported raw materials from Israel - wood, metal, cement - so as to supply the local factories. The result is the dependence of local manufacturers on Israel. Manufacturers, as a result, have become the second class to be linked with the Israeli economy.

Israel's economic structure is constantly changing in accordance with the needs of the world division of labour. These continual changes affect the economy of the West Bank as an occupied and peripheralized adjunct to the Israeli economy. In the mid 1960s, Israel started to transform its industries toward specialization in electronics and sophisticated armaments industries so as to accommodate the world division of labour which has pushed the developed countries towards technological specialization. This is why Israel has decreased emphasis on many of its traditional industries such as textiles, footwear and chemicals. The West Bank and Gaza Strip face a process of re-allocation of industries to their detriment. While Israel concentrates on industries with a future, the West Bank and Gaza Strip are left with branches of production at a lower technological level and with fewer prospects of growth, a situation which perpetuates the economic gap between them. Much of the re-allocation has taken the form of transferring textile production to the West Bank and Gaza Strip.

Despite the 150-200 thousand strong wave of emigration in the wake of the 1967 war and the mass expulsions which followed it (such as the ten thousand persons of the three villages of Immwas, Yalo and Beit Nuba in the Ramallah district which were destroyed in the week following the 1967 war), the unemployment rate actually increased. The reason for this was a sharp decline in the demand for labour in the West Bank.

The effects of the war paralysed various spheres of manufacturing and agriculture. Moreover, the public services sector which had been a major employer under Jordan was cut to the minimum by the Israeli occupation authorities. As a result, many Palestinian workers were faced with the choice of emigrating or of working in Israel. The first step in the latter case was work with Israeli contractors inside the West Bank itself as Israel started to enlarge roads there and appointed local foremen who, in turn, recruited local workers.

Ten thousand workers were hired daily for road construction whether paving new roads or widening and maintaining those which existed. This marked the beginning of the creation of the stratum of sub-contractor and mediator which stands between the Israeli entrepreneurs and capitalists on the one hand and the West Bank workforce on the other. Even before the large scale expropriation of land and the accelerated development of capitalist relations of production, Palestinian workers came primarily not from the cities and refugee camps but from rural areas.

The peasant family was compelled to increase its cash income by sending members to seek hired employment and, as a result, the West Bank consumers and producers (the whole society) began to depend on the Israeli economy. This was not, of course, a voluntary dependence, (except for the traders and compradors) since it was shaped and formed by the policies of the Israeli state. The political factor (the role of the state) worked relatively autonomously in the peripheralization of the West Bank. Nevertheless, the economic factor was and remains the determining one, crystalized in land expropriation, collecting taxes, employing cheap labour and accumulating profits through unequal exchange and the obstruction of the West Bank's internal accumulation process.

Alongside limitations on external trade, Israel has maintained the West Bank agricultural trade with Jordan. This policy can be described as an open offer for Jordan to participate in the peripheralization of the West Bank and be a partner in a political compromise in the Arab-Israeli conflict. However, the 'open bridges' policy has also created a channel for financial remittances from Palestinians abroad to their families in the West Bank and from the Palestinian-Jordanian Joint Committee and other Arab countries. Indeed, 'The percentage of the disposable income derived from external sources may have reached over 40%, and it is growing'.8

Local classes as mechanisms of peripheralization

ALTHOUGH THE POLICIES of peripheralization by integration were created by the occupation authorities, a significant portion of the peripheral bourgeoisie of the West Bank has acted as local bearers and agents of these policies. This portion consists of three main strata:

(1) The merchant bourgeoisie (city merchants) which has existed since the period of Jordanian rule and has intensively exploited local farmers.

(2) The large agricultural landowners who orient their production towards exchange with Israeli and foreign centres.

(3) The new comprador capitalists created directly and intentionally by the occupation authorities.

These three strata provide a good example of the structural dependence (economic, social, political and cultural) of peripheral capitalism.

Just as Israeli capitalists engage in relations of production with Jewish workers and agricultural wage earners in Israel, so the West Bank agricultural capitalists have a relationship with West Bank workers and poor peasants. The merchants in the two geographic areas are mediators. This is especially true of the West Bank merchants who are primarily importers from Israel. In this role, their interests have become totally dependent on Israeli-produced goods and the marketing of those goods in the West Bank. The mediating role of the merchants is not a new phenomenon developed during the period of occupation, nor is it purely economic.

The comprador capitalists, merchants and traders have existed since Jordanian rule over the West Bank. Some changes have taken place in terms of individuals but not in the role of the stratum. In addition to these old classes, the Israeli occupation has backed a new group of local collaborators who have acquired franchises to market the produce of Israeli companies in the West Bank. This new comprador class has made a quick profit mainly because it alone was granted the right to import to and export from the West Bank by the military government. In other words, these merchants have been created by the occupation. When it is considered that 90 per cent of the West Bank's imports come from and 50 per cent of its exports go to Israel, the importance of this class can be seen. Moreover, in 1984 the West Bank balance of trade showed a deficit of $220 million with the Israeli economy. This demonstrates the role of the merchants as a channel draining the surplus from the local economy into that of Israel, importing luxury goods and leading to the inability of the West Bank to maintain its surplus.

The contribution of such merchants to the local market is deformed. Whilst expropriating the majority of the surplus, Israel's colonialism leaves a certain amount of surplus value and surplus labour to its allied classes in the West Bank and this is distributed among the comprador-capitalist, financier, and land-owning strata. 'This distribution provides the basis for an internal demand, larger for luxury (department IIa) goods'.9

The larger demand for luxury goods does not enlarge popular demand but rather increases the demand for import goods to satisfy the desires of the self-same strata. Moreover, the strata in the West Bank which have allied themselves with Israeli colonialism have not maintained their share of the surplus inside the country. Much of this is exported to Arab and foreign banks as credits, invested there or consumed by luxury imports.

As a result of the expropriation of the West Bank surplus by Israeli colonialism and some local strata, West Bank agricultural producers are unable to accumulate or to enlarge the home market. All these producers can do is to reproduce themselves and their families on a limited scale.

The aforementioned alliance is inevitable continuing the analysis from the level of production to the level of relations of production existing between labourers and non-labourers.

Despite the national struggle of the Palestinian masses for liberation and self determination in their homeland, the comprador-capitalist, financier, and land-owning strata have allied themselves with settler colonialism, revealing their double role, as economic collaborators with colonialism and thus, as collaborators in the political sphere.

The following extract from an interview fully represents the political position of this strata: Ian Black, a journalist from The Guardian interviewed Abdul Ralunan Abu Sninah who was appointed by the Israelis after they dismissed Haj Tawfiq Abu AI-Nasser, the elected mayor of Qalqiliah:

How can I not be worried? A stone or a molotov cocktail thrown at an Israeli vehicle destroys the good relation between the Jews and us. We are very close to Israel and 80-90% of all our produce goes to the Jews. Now they do not come here to do their shopping any more'.

If Abu Sninah is trying to guarantee that West Bank produce is marketed inside Israel without taking into consideration the question of dependency, his position towards settlements is the same:

We have no problems at all with "Alfe-Menashe" [the closest Israeli settlement to his town]. The people who bring trouble come from other settlements. There are extremists here too, maybe small children, maybe sent by PLO.10

It is in the interests of the merchants, compradors, and big landowners to have a quiet political situation in the West Bank in order to maintain their profits. They have failed to concert their interests with those of Palestinian nationalism. Thus, Abu Sninah talks amicably about an Israeli settlement which is built up on his own town's land.

A merchant of Bethlehem attributes the market depression to the political situation. The store manager said:

Politics is the reason. We had a demonstration here two weeks ago and there's been virtually nothing since. We haven't had a single customer all day.11

What this strata wants is a quiet political situation, no political resistance to the occupation.

Peripheralization through the production process

The effects of peripheralization are not limited to the level of exchange but continue down to the level of production, from the external factor to the dialectic between the external and internal factors and social forces.

Under Jordanian rule, most West Bank peasants and farmers produced for the market. Their surplus production was exported to the East Bank and to several Arab countries, like Kuwait, Syria and Iraq.12 Peasant production under Israeli settler colonialism has been drastically reoriented towards several markets, in the first place the Israeli but also the Jordanian and the East and West European markets. This rapid reorientation was achieved during the first phase of Israeli policies in the West Bank (peripheralization through integration).

It is not only the production of the large landowners which is oriented mainly towards foreign markets but also that of the small peasants. This is an assertion of the domination of capitalist relations of production over the peasantry. The orientation of the peasants' production towards external markets was achieved through (a) al-Mushahada policy: Israeli incentives and bonuses paid to farmers planting certain crops which Israel requires to satisfy its exports, (b) the low price of the peasant's traditional crops when compared to the al-Mushahada crops and (c) because the West Bank market is small and unprotected, Israeli-subsidised products succeed in competition with peasant produce.

As long as Israeli producers freely market their subsidised produce in the West Bank's open market, the local peasant farmer cannot compete. He has two alternatives, either to produce the crops demanded by Israel or be beaten by Israeli competition. In the second case, he abandons his small plot of land and becomes a wage earner inside the Green Line.13 Since the peasant's farm is no longer the major source of income, land ceases to be of value in itself. The farmer begins to rely on employment as a migrant worker and not on ownership of land to acquire material security. After several years of abandonment, in addition to the passive effects of the Israeli economic crisis which has resulted in the redundancy of thousands of the West Bankers working in Israel, the peasant/worker faces the problem of lack of liquidity to reclaim the land (if it has not been expropriated by the Israelis in the meantime).

Various forms of peripheralization

Rural surplus workforce

BESIDE THE ORIENTATION of the agricultural capitalists and the small (independent) peasants towards producing for the foreign markets, the surplus rural workforce has also been directed towards the Israeli and the Arab markets. The reason why this surplus workforce has become externally oriented is that the local cities are unable to provide extra employment.14 Rather, this surplus West Bank workforce flows into the Israeli economy as a cheap labour force. The forms of exploitation of migrant (commuter) labour are complex and require analysis.

The employment of West Bank migrant workers takes several forms. Since these workers gain jobs in the Israeli economic sectors, they are exploited on the level of class relations of production despite the fact that the worker and the capitalist originate from different economic systems. Moreover, the worker is exploited as a Palestinian. It is this nationality which permits lower wages, lack of job protection and of social security. Tsur emphasizes this when he notes:

The Israeli investor prefers the intensive cheap manual labour over the intensive capital and technology which contains the future of Israel.15

On the contrary, Jewish workers are not employed in West Bank farms or enterprises and so are not exploited by West Bank capitalists in any sense.

The process of labour migration is facilitated by West Bank subcontractors. Such people form another West Bank mediator stratum, one which has developed on the margins of the migrant labour phenomenon. The role of this stratum is to recruit migrant labour to work in Israeli enterprises. These mediators deduct part of the migrant worker's wage for themselves. Their role is facilitated and protected by the occupation authorities.

Seventy per cent of migrant labour is rural in origin, and most of the 'illegal' workers are from rural areas close to the Green Line.16 The peasant majority among migrant labourers is demonstrated by the fact that: 'A further 162,000 had been driven or locked out of their land during or following the Israeli occupation in 1967'.17 Another form of exploitation of West Bank workers is the employment of the workforce inside the West Bank itself, but in projects or workshops which are entirely devoted to satisfying Israeli needs, such as brickworks and quarries. The workers in these enterprises are mostly villagers.

Although the places of work are in the West Bank and the local bosses are West Bankers, they are sub-contractors of an Israeli company. In other instances the entire operation is locally owned but production is entirely geared towards Israeli demand. In the first case the Israeli capitalist and the subcontractor divide the surplus produced by the workers. Here the Israeli capitalist is not a mere merchant but also a direct exploiter. An extreme example of this mixed case is that of some of the sewing workshops that exist in most West Bank villages. The workshops operate as follows: the Israeli entrepreneur provides the cloth and the capital and distributes the cloth through and/or with a local sub-contractor to the village women. The Israeli capitalist pays the sub-contractor a sum as commission. This sum is a marginal amount of the surplus which goes directly to the Israeli capitalist. Such cases evidently represent direct class exploitation, particularly the exploitation of West Bank women as cheap labour whose production is sold in Europe.

The joint-ownership of companies between Israelis and a few West Bank capitalists provides another example of direct Israeli exploitation of both West Bank workers and economy.18

By far the most striking example is the employment of Palestinian villagers as wage earners in the settlements built on their expropriated land. Those who have thus lost their only plot of land, transfer totally to wage labour while those who still own land become peasant-workers.19 These workers and peasant-workers labour inside their country but in purely Jewish-owned projects and communities. These projects are not Israeli projects in the Palestinian economy but projects inside Jewish communities in the Israeli settlements which are directly articulated to the Israeli economy and which simultaneously exploit local labour along both class and national lines.

The effects of migrant labour on the local economy can be summarized as follows:

  • Increasing abandonment of land.
  • Increasing money liquidity which encourages consumerism that is satisfied through imports from Israel.
  • The export of labour power to the Israeli economy which extracts surplus value.
  • Surplus value is extracted from these labourers at a higher rate than from Israeli workers. This is expressed not least in terms of wage rates.
  • The conversion of the village from unit of production to workers' dormitory.
  • Physical and psychological separation of the peasant from the land.
  • The greater the separation, the greater the deterioration of the land and the amount of money necessary for its reclamation.
  • Israeli capitalism doubly exploits the migrant worker whose wage is repaid by buying Israeli commodities to satisfy daily needs. Thus, unwittingly, the migrant worker hinders internal accumulation in the West Bank.
  • Finally, that part of the rural surplus labour which is not absorbed in the West Bank cities or inside the Green Line must emigrate to Jordan or other Arab countries.

The destination of the surplus labour of migrant workers

EVEN IF WEST BANK MIGRANT WORKERS return to their villages after work, they are nevertheless exploited through the capitalist relations of production in the place of work inside the Green Line. That is to say, this exploitation is a class exploitation despite the fact that the two classes in the exploitation process are from two separate economies. At the same time, there are the emigrant workers working and residing outside the West Bank, in Jordan and the oil states who are also exploited on a class basis.20 What is interesting to note here is how the class exploitation of the two groups of workers, both created by peripheralization, contributes to the yet further peripheralization of the West Bank.

From those employed inside the Green Line Israel extracts the highest possible surplus value. Their wages are 50-60 per cent of those of Israeli workers. In addition to this, their work rights are either non-existent (in the case of 'illegal' migrants) or very limited (in the case of registered workers). The West Bank is a pool of cheap labour for Israel and for the Arab oil states and other countries, and is the source of a mobile workforce. West Bank migrant workers in Israel contribute to Israeli accumulation through their extracted surplus labour. On the surface the Israeli economy temporarily loses the wages which migrant workers take back to the West Bank, but in the third step of the process, these wages are returned to Israel through the merchants who import consumer goods either directly or through middlemen. It is as if the wages were loans from Israel to these workers. This circle of labour, wages and prices of commodities primarily expands the Israeli home market, not that of the West Bank. The labour power of migrant workers is exported to Israel through the sub-contractors and their wages are returned or channelled back to Israel through the merchants. Both sub-contractors and mediators are agents of the peripheralization of the West Bank economy.

Those workers employed outside the West Bank also comprise a pool of cheap labour but the surplus of these workers is extracted outside both parts of their homeland. Their wages are divided into two categories: (a) part of it saved in banks or in investments outside; (b) part sent back home as remittances to their families. These remittances find their way to Israeli home market in the form of payment for the goods consumed by their families.21 Neither the wages of the migrant in Israel nor of those outside contribute to internal accumulation. Quite the opposite, they contribute to the deepening of peripheralization.

The increasing consumption of West Bankers22 increases the outflow of money to the Israeli market. Another factor contributing to the outflow of money is the decreased production of field crops and subsistence production and the increased production of externally oriented crops by West Bank farms. In the end, most of the income of West Bankers flows out to the Israeli economy.

Migrant labour without a solution to the agrarian question

DURING JORDANIAN RULE, the agrarian question remained unsolved. Jordan's peripheralization within the world system lies behind this. West Bank agriculture during the period failed to achieve the two conditions necessary to solve the agrarian question. These conditions are: firstly, agriculture has to generate a surplus to make industrial develòpment possible; secondly, it must contribute towards the development of a home market for the goods produced by the industrial sector.23

Because of its deformed structure, the surplus of the West Bank agricultural sector was not devoted to industrial development even though production was for the market. As the surplus did not stay in the West Bank itself, it did not contribute towards the development of the home market. Moreover, the West Bank's deformed economic structure did not absorb the peasantry's surplus workforce into industry. So the differentiation of the peasantry did not help to enlarge the 'home market' since the peasantry's surplus workforce emigrated to Arab oil states and North and South America. In other words, the Jordanian state channeled the surplus labour power towards emigration in order to avoid the tasks of solving the agrarian question and starting industrialisation of the West Bank.

The Israeli occupation opened several channels for absorbing the surplus peasant workforce, employment in the Israeli economic sectors or emigration to Jordan, Arab countries and elsewhere. As a settler colonial occupation, the Israeli occupation is not interested in resolving the agrarian question or in enlarging the 'home market' of the West Bank. As Cardoso noted:

. . . it is possible in some 'peripheral' economies, that capitalist development is progressive, raising the level of productive forces and widening the domestic market'.24

It is clear that in the West Bank, under Israeli occupation, this is not the case. The productive forces have been deformed as follows: firstly, traditional subsistence agriculture has declined to the minimum in accordance with the Israeli policy of 'improvement and commercialization'; Secondly, all fertile land has been oriented to production for foreign markets. In both cases, production is diverted from the local market. Thirdly, industrial production has stagnated since 1967.25

A marginal widening of the home market comes from another direction but this too deepens the deformation. This is the money liquidity from outside in the form of remittances and transfers, 'which comprises 40 per cent of the GNP', that is the Steadfastness Aid. This money liquidity is part of the cycle of deformity and only boosts the consumption of the population without increasing their productivity. It is not invested in productive enterprises and increases the foreign currency entering the Israeli economy through trade. So, the real expansion here is the expansion of the Israeli home market. In the West Bank the means of consumption, not the means of production, have developed, partially financed by remittances and transfers.

The West Bank's political peripheralization to Jordan

As MENTIONED ABOVE, the West Bank was a periphery of the Jordanian economy. This peripheralization was created under Jordanian rule through policies which kept the West Bank economy weak and dependent on Jordan, aiming to block any Palestinian attempt to re-create Palestinian national identity. This is demonstrated by Jordan's policy of concentrating all industrial and agricultural projects in the East Bank. In the period 1950-1967, Jordan played the leading role in the West Bank's economic peripheralization.

Through its peripheralization to the backward Jordanian economy, the development of the West Bank's economy was prevented. After 1967, the West Bank economy became primarily and easily a periphery to the Israeli economy.

Beside the West Bank's peripheralization to the Israeli economy, Israel maintains a continued and controlled relationship between the West Bank and Jordan through the 'open bridges policy' and through political contacts. The 1984-85 Israeli annual report on the West Bank notes that: 'increasing division within the PLO ranks caused a continuous decline in the PLO's support and influence in the area.'26

While attributing a decline in support for the PLO to the latter's internal division, the report emphasizes that Jordan's influence has increased considerably. The report notes that Jordan has intensified efforts to strengthen its influence by intervening in various aspects of life, thus exploiting the decline in the PLO's support in the area.

The report does not mention what made it possible for Jordan to intervene freely in the West Bank nor does it discuss the reasons for the supposed decline in PLO influence. The Israeli occupation, which controls all aspects of life on the West Bank, has facilitated Jordanian activities on the West Bank while harshly repressing those of the PLO.

Israel's aim in pursuing this policy is to keep the door open for a political compromise with Jordan. The content of this compromise can be described in the words of Moshe Dayan, ex-Israeli defence minister who said in the early days of the occupation:

If King Hussain cannot accept our conditions for peace, let the Jordanians find another King. And if the Jordanians do not accept our conditions for peace, they have to find another homeland for themselves'.27

The 'open bridges policy' also aims to facilitate the emigration of West Bankers to Jordan and beyond. The Israeli aim meshes with Jordanian political ambitions to restore even a minimum of control over the West Bank, such as security administration. This ambition connects with Dayan's theory of the 'functional division' of the West Bank. What should be noted here is that Israel's policy on West Bank exports to Jordan is much more flexible than its policies towards its imports. This facilitates emigration or future eviction. Moreover, the 'open bridges policy' has become a channel for foreign currency to enter the Israeli economy through Arab transfers and Palestinian remittances.

Concerning political contacts; in 1967 Israel proposed 'self rule' for the West Bank and Gaza Strip. This same project was revived by Israeli Prime Minister Shimon Peres in 1985. This project suggests that: 'Israel is going to hold the responsibility for security in the Occupied Territories, Jordan is going to take responsibility for policing. Water resources should be under common administration.'28

Due to many considerations, Jordan has accepted the offer in order to confirm its role as a marginal centre for the West Bank and to block (if possible) Sharon's plan which aims to evacuate half a million West Bankers to Jordan.

The agricultural peripheralization relationship of the West Bank to Jordan must be emphasized. The West Bank merchant-capitalist stratum mediates between Jordanian, Israeli and West Bank producers to facilitate the export of West Bank agricultural crops through Jordan. This stratum has remained a part of the fabric of the Jordanian economy since the pre-1967 period through its farms and factories in the East and West Bank. This stratum enjoys Jordanian facilities for marketing its agricultural crops and industrial production. 'One third of the industrial export to Jordan is Samna (plant-based margarine produced in Nablus), forty per cent is olive oil and soap'.29 The Samna and soap factories are owned by the agricultural-merchant capitalist stratum.

At the same time the Arab regimes also facilitate the exporting of West Bank crops through Jordan in accordance with decisions of various Arab summit meetings. The Arab decision allowed the West Bank to export 50 per cent of its total agricultural production to the Arab countries through Jordan. The exportation is conditional on a document called '5hahadit Mansha', a certificate to prove that the crop is of West Bank origin.30

At this level, Jordan is still free to buy West Bank exports or not, whereas West Bankers are prohibited from marketing freely in Jordan. Their crops are supposed to be transported to the central Amman market and thus they cannot compete with foreign products such as Spanish olive oil or Turkish grapes.31 In fact, it is the other Arab states which purchase the bulk of West Bank agricultural exports. Kahan notes:

Approximately 95 per cent of the volume of agricultural exports tend to be exported between January and June. Only a small proportion of the exports remain in Jordan. The majority are forwarded to Saudi Arabia and the Gulf states'.32

At the same time, Jordan imposes taxes on agricultural exports from the West Bank and Gaza, but for political reasons these taxes are waived on occasion.33 But the story is not as simple as that. The West Bank's exports have also been over-burdened with problems ensuing from the protectionist policies of several importing Arab countries. In addition, the fate of the West Bank's exports depends on Jordan's political relations with the PLO and the Palestinians inside the Occupied Territories. The following is a striking example of Jordan's politically-oriented policy towards the West Bank:

Twenty trucks carrying melons from the West Bank were not allowed to cross the bridge to Jordan. The Jordanian authorities claimed that the period of melon export had expired. Israel radio reported that Israeli authorities tried to interfere and convince the Jordanians to give access to the twenty trucks but the Jordanians refused.'34

Moreover, some Arab countries are competing with the West Bank crops in the Jordanian market as is the case with melons of Saudi Arabian origin.


THE MASS UPRISING which began in December 1987 can hardly have come as a surprise to anyone. However, the dramatic events which have unfolded in the streets of every town, village, and refugee camp in the occupied territories and which have found support among the Palestinians inside the Green Line, constitute a new phase in the ongoing Palestinian struggle for justice, dignity and independence. For the first time, the masses are expressing their resistance to occupation through sustained demonstrations, strikes by traders and migrant workers, and street fighting. The people have developed and employed their own weapons of struggle and an air of popular democracy has pervaded the atmosphere. Everyone lends support, everyone has become a militant and a leader. Villages under siege by the occupation forces and their paramilitary settlers have been relieved by the people of neighbouring villages who have infiltrated through Israeli lines to bring milk for children, food for adults, and reinforcements for the defenders. The aspiration for independence has been expressed not only by the stone throwers but also by popular decisions to boycott Israeli goods and to stop working for Israeli enterprises. Depending on themselves alone, the Palestinian masses have taken their struggle onto the political, national, and economic planes and in so doing have taught the occupation authorities a bitter lesson, revealing the deficiency of the orientalism and militarism of their theoreticians and planners.

The uprising has brought the mechanisms of peripheralization to the brink of collapse: the compradors have seen bankruptcy looming and despite the threat of hunger, workers have maintained strike action month after month, rejecting combined class and national exploitation but ready to accept work within their own economy so long as it is geared toward the common good. The Palestinian masses have proved day after day, month after month, that they are searching for (and finding) ways to break the dependence and peripheralization which has been forced upon the occupied territories. For its part, the Israeli state continues its policies of military, economic and social repression, maintains its refusal to negotiate with the PLO, preferring to attempt backroom deals with Arab regimes. In so doing, it not only prolongs the ongoing Palestinian tragedy, it also deepens Palestinian determination to be rid of peripheralization and to create their own economy and their own state.

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  • 1Wolpe, H. The Articulation of Modes of Production, University of Sussex, 1980, p38.
  • 2Ibid, p 36.
  • 3Cardoso, F. H. Dependent capitalist development in Latin America, New Left Review, 1972, no 74, p 90.
  • 4Kahan, David. Agriculture and water in the West Bank and Gaza, West Bank Data Project, Jerusalem, 1983, p 62.
  • 5Ibid,p51.
  • 6Tsur, Davar, 22.8.1986.
  • 7Kahan, David, op cit, p 109.
  • 8Benvenisti, Meron. The West Bank Data Project, Jerusalem, 1986.
  • 9Taylor, John. From Modernisation to Modes of Production, Macmillan Press, London 1983.
  • 10The Guardian, London, 13.5.1987.
  • 11The Guardian, London, 24.12.1986.
  • 12Before 1967, most of the West Bank's grapes, tomatoes, olives, olive oil, fruits and grain crops were exported from the West Bank through the East Bank to several Arab countries. The export of these crops was governed by the political relationship between Jordan and those countries. In 1954, '58, '61, '63 and '65, West Bank farmers were unable to export their produce to Syria because of deteriorated political relations between Jordan and Syria, resulting in the latter's closing of its borders. Thus, farm produce was not marketed.
  • 13Landowners and merchants facilitate the bankruptcy of the independent farmers by controlling the resources. In addition to the extracted surplus from the farmers, they make substantial profits through marketing seeds and fertilisers at high prices. The most striking example is the Arab Jerusalem Cigarette Company whose board of directors decided to buy raw materials from South Africa through an Israeli third party in an attempt to force West Bank farmers to sell their crops solely to the company at a 'minimum' price. (Jarar, Samed, no 60,1986, p 31).
  • 14The number of those employed in industry inside the West Bank was 14.6 thousand in 1970, 15.7in 1980 and 15.9 in 1984 (lsraeli Statistical Abstract, 1985, p 725). This reflects the stagnant situation of industry on the West Bank and invalidates Israeli claims that 'the decrease in agricultural employment and the increase in industrial employment are usually linked with internal migration from the villages to the towns' (Coordinator of Government Operations in Judea, Samaria, Gaza Strip and Sinai, 1967-1981, April 1982, p 5).
  • 15Tsur, op cit.
  • 16Interview with Faisal Hindi, General Secretary of Tulkarm Trade Union, 20 September, 1984.<.fn> The Israeli daily, 'Jerusalem Post', mentioned that: 'a checkpoint between Bethlehem and Jerusalem registered the number of workers passing the point was 7,780, of whom 2,000 were illegal, that is about 26 per cent.' Moreover, most of the women migrant workers inside the Green Line are illegal.In 1984, legal workers inside the Green Line numbered about 47,000. Illegal workers numbered 30,000 and those working in Israeli workshops inside the West Bank about 20,000. Those 20,000 must not be included in the total of 104,000 who were working inside the West Bank itself.
  • 17Jordanian Development Plan, 4.8.1986.
  • 18Samara, Adel. Iqtisad al-Jou fi al-Diffa wal-Qjta'a (The Economics of Hunger in the West Bank and Gaza Strip). Dar al-Amel, Ramallah, West Bank.
  • 19Migrant labour in the West Bank is still unstable. As a result of Israeli expropriation of the farmers' land, those who became landless have lost their livelihood and therefore have to work for several years as wage earners inside the Green Line. Having lost their ownership of the means of production, they became proletarianised.
  • 20The Ministry of Labour in Jordan estimates that of the 350,000 'Jordanians' (40% of the labour force) working abroad, one third are from the West Bank (see Associated Press, 14.4.1985).
  • 21The remittances of West Bank workers in the oil-producing countries are estimated at $350 million per annum. (Ibid).
  • 22For more analysis on the increase of 'consumerism' in the West Bank, see Samara 1979, pp 188-208 op cit.
  • 23Lenin, V.I. Collected Works, Vol. 3, Lawrence and Wishart, London, 1972.
  • 24Goodman D and Redclift M. From Peasant to Proletarian, Capitalist Development and Agrarian Transition, Camelot Press, Southampton, 1981, p 51.
  • 25Benvenisti, Meron. The West Bank Data Project, Jerusalem 1986, p 10.
  • 26Introduction to the Civil Administration, Judea and Samaria Annual Report, 1984.
  • 27Yediot Ahronot 17.7.1967.
  • 28Al-Hadaf, no 824,14.7.1986.
  • 29Benvenisti, Meron. A Survey of Israeli policies, The West Bank Data Project, Jerusalem, 1984, p 10.
  • 30Al-Awdeh, no 70, 10.7.1985.
  • 31Ibid.
  • 32Kahan, David, op cit, p 110.
  • 33Al-Arab, 16.6.1986.
  • 34Al-Fajr, 27.6.1986.