VZCZCXRO3899
OO RUEHROV
DE RUEHJM #0856 1471354
ZNR UUUUU ZZH
O 271354Z MAY 09
FM AMCONSUL JERUSALEM
TO RUEHC/SECSTATE WASHDC IMMEDIATE 4926
INFO RUEHXK/ARAB ISRAELI COLLECTIVE PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC PRIORITY
RUEATRS/DEPT OF TREASURY WASHDC PRIORITY

UNCLAS JERUSALEM 000856 
 
SENSITIVE 
SIPDIS 
 
NEA FOR FRONT OFFICE AND IPA; TREASURY FOR AHERN/MOGER; NSC 
FOR KUMAR; JOINT STAFF FOR LTGEN SELVA 
 
E.O. 12958: N/A 
TAGS: ECON PREL ETRD KWBG IS PINR
SUBJECT: JENIN SECURITY IMPROVEMENTS LURE BUSINESS 
INVESTMENT, BUT SUCCESS DEPENDS ON MOVEMENT AND ACCESS 
 
¶1. (SBU) Summary: The Herbawi Home Center ) a 
first-of-its-kind home appliance superstore in the West Bank 
) held a grand opening in Jenin on May 21.  Company owners 
and local government officials say the investment was made 
possible by security gains in the city over the past two 
years.  Owners estimate that the Home Center's success will 
depend in part on Arab-Israeli customers, as well as on GOI 
cooperation in allowing timely deliveries over the Green 
Line. End Summary 
 
A Grand Opening 
--------------- 
 
¶2. (SBU) EconOff attended the grand opening of the Herbawi 
Home Center in Jenin on May 21.  The Home Center consists of 
four (soon to be seven) spacious floors stocked with modern 
home appliances, furniture, and other related products.  The 
store's owners claim this is the first home appliance 
superstore to open in the West Bank.  In his public remarks, 
Jenin Governor Qadora Musa said the establishment of the Home 
Center demonstrates the private sector's confidence and 
willingness to invest in Jenin and comes as a result of 
improved security over the past two years.  Over 200 people 
attended the opening, including the PA Minister of Economy 
and the Mayor of Hebron (a Jenin native). 
 
A First for Jenin 
----------------- 
 
¶3. (SBU) The general manager and owner of Herbawi Home 
Center, Nasri al-Herbawi, who owns smaller furniture outfits 
in Hebron, Ramallah, Nablus, and Tulkarm, told EconOff that 
he decided to open the Home Center in Jenin because there is 
nothing of its kind in the northern West Bank.  Also, a Jenin 
location makes it possible to target the vast number of 
Arab-Israelis living across the Green Line.  Herbawi 
expressed enthusiasm about reported Israeli plans to allow 
Arab-Israelis to drive private vehicles into Jenin to shop. 
In the meantime, he said, the Home Center will provide 
delivery service over the Green Line.  Herbawi anticipates 
some problems with moving his product over the border, but 
confided to EconOff that his company receives "special 
treatment" because of his trusted name and longstanding 
record of firm documentation of all transactions. 
 
¶4. (SBU) Herbawi told EconOff that, although Home Center 
products are available in Israel, his prices are more 
competitive, and he believes Arab-Israelis will be inclined 
to support a West Bank company.  Around 70 percent of his 
products are imported, mostly from China and Malaysia, and 
the rest are locally made.  The Home Center signed agreements 
with two large Palestinian distributors, Maslamani and 
Sbitani (both based in East Jerusalem), to supply the store 
with kitchen and electronic supplies. 
 
Improved Security Spurs Investment, but Risks Remain 
--------------------------------------------- ------- 
 
¶5. (SBU) Herbawi's assistant told EconOff that the company 
has complete confidence in the PA authorities to secure the 
Home Center ) a USD 5-6m investment ) and that the improved 
security was an integral part of the decision to invest in 
Jenin.  However, Herbawi admitted that he viewed the Home 
Center as an economic risk.  "This isn,t Ramallah," he said. 
"We want to try something different, and we,re hopeful it 
can be a success."  Herbawi said he has tried to minimize 
risk by purchasing the building in cash rather than leasing 
(the common practice) to cut rental costs.  Herbawi said that 
the building cost around USD 5m, and that he is prepared to 
rent it out if the Home Center fails. 
MARCHESE