VZCZCXRO4194
OO RUEHROV
DE RUEHJM #0607/01 0941104
ZNR UUUUU ZZH
O 041104Z APR 07
FM AMCONSUL JERUSALEM
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7122
INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY
RUEHBS/USEU BRUSSELS PRIORITY

UNCLAS SECTION 01 OF 02 JERUSALEM 000607 
 
SIPDIS 
 
SIPDIS 
 
NEA FOR FRONT OFFICE; NEA/IPA FOR 
WILLIAMS/SHAMPAINE/BELGRADE; NSC FOR ABRAMS/DORAN/WATERS; 
TREASURY FOR NUGENT/HIRSON 
 
E.O. 12958: N/A 
TAGS: ECON ETRD PREL KWBG IS
SUBJECT: HEBRON BUSINESSMEN SURVIVING BUT FEAR GREATER 
ACCESS RESTRICTIONS 
 
¶1.  (SBU) SUMMARY:  Hebron business leaders told Econoffs 
March 28 that they fear their current access to Israeli 
markets through Tarqumiya crossing could quickly deteriorate 
if back-to-back procedures are implemented there, since their 
products cannot easily be transferred back-to-back.  In 
addition, internal closures in the Hebron area raise costs 
and create uncertainties that impede further investment. 
They asked the USG to urge the GOI to maintain Tarqumiya's 
current procedures, remove obstacles to movement, and enable 
greater access for Palestinian businessmen to Israel.  END 
SUMMARY. 
 
----------------------------------- 
TARQUMIYA CROSSING WORKING, FOR NOW 
----------------------------------- 
 
¶2.  (SBU) Econoffs met March 28 with businessmen representing 
some of the largest local export industries in Hebron, 
including Abed Atrash, owner of a stone and marble factory 
(USD 20 million net worth); Nazmi Haddad, owner of a steel 
rod factory (USD 20 million net worth); and Wael Herbawi, 
owner of a sponge and mattress factory (USD 50 million net 
worth) who told us he supplies over half the Israeli hotel 
industry.  Fifty-five to 68 percent of their sales are to 
Israel, which they ship through Tarqumiya crossing in the 
southern West Bank.  Two of the companies own and operate a 
fleet of Israeli-licensed trucks, which can cross Tarqumiya 
without undergoing back-to-back procedures.  The other avoids 
unloading his cargo by using detachable containers that 
exchange Palestinian truck cabs for Israeli truck cabs at 
Tarqumiya.  All three businessmen requested longer operating 
hours at Tarqumiya, but said current procedures are otherwise 
manageable. 
 
¶3.  (SBU) However, the owners expressed fear that their 
products' access to Israel could quickly deteriorate and lead 
to the collapse of their businesses if a back-to-back system 
is imposed when the new terminal at Tarqumiya opens in May. 
Herbawi estimated that a back-to-back system would increase 
the time to process trucks from Hebron at least 
thirteen-fold.  Additionally, each owner said his products 
were poorly suited to back-to-back procedures.  Existing 
scanners cannot scan stone, pallets subject mattresses to 
damage, and the logistics of unloading and scanning 
twelve-meter steel bars have not been developed.  The 
businessmen predicted that a back-to-back process would 
double costs, damage products, and multiply uncertainties, 
leading to roughly 7,000 jobs lost in the stone and marble 
industry, 300 jobs lost (75 percent) at the mattress factory, 
and the cessation of steel factory operations. 
 
¶4.  (SBU) The businessmen asserted that the GOI recently 
published new instructions for West Bank crossing points, 
including Tarqumiya, implying that a back-to-back system will 
be required.  (NOTE:  Econoff has acquired a copy of these 
instructions.  END NOTE.)  Owners worry that this is only a 
first step toward reduced access from the West Bank to 
Israel, on the model of Karni/al-Mintar crossing.  This 
uncertainty holds back expansion plans of the more prosperous 
owners, they said. 
 
--------------------------------------- 
INTERNAL CLOSURES ARE THE REAL PROBLEMS 
--------------------------------------- 
 
¶5.  (SBU) Obstacles to movement in and around Hebron 
currently have the most immediate impact on businesses. 
Flying checkpoints sometimes prevent the import of raw 
materials.  The main gate to the Hebron industrial estate has 
been closed since 2000, requiring detours that clog Hebron 
streets while doubling the time and cost to move goods to 
Tarqumiya.  In one instance, poor roads caused a truck 
carrying a 27-ton marble block to lose control, destroying 
five other vehicles in its path.  Atrash noted that, if the 
main gate to the Hebron industrial estate were opened, lower 
transport costs would allow him to increase production by up 
to 40 percent. 
 
¶6.  (SBU) The steel factory's access to the nearest road has 
been blocked by an earthen mound since 2001, and Haddad noted 
that workers, truckers, and potential customers have to 
trespass on private land to reach the factory.  If land 
owners cut off access, Haddad said, it will suffocate his 
business.  (COMMENT:  Opening the gate to the industrial 
estate and the main highway to the steel factory could help 
 
JERUSALEM 00000607  002 OF 002 
 
 
these business owners to stimulate production and cushion the 
economy during the downturn.  END COMMENT.) 
 
---------------------------- 
FACILITATING BUSINESS TRAVEL 
---------------------------- 
 
¶7.  (SBU) The owners noted that they had not received a 
Businessman's Card (BMC), which once provided preferential 
access to Israel for West Bank businessmen.  Herbawi argued 
that more BMCs need to be issued and the issuance process 
should be more transparent.  He added that the BMC card is 
now valid for only six months, half the period of the 
original cards, with more restrictions. 
 
WALLES