Report Reveals European Firms Have More Than $255B Entwined in Illegal Israeli Settlements

October 21st, 2021

By Jessica Buxbaum

Source

The Israeli Jewish-settlement of Maale Adumim, near Jerusalem, Feb. 7, 2017. (AP/Oded Balilty)
The continuous settler takeover of Palestinian land has prevented Palestinians from developing and utilizing their resources and therefore significantly depleted their economy.

OCCUPIED WEST BANK, PALESTINE — Nearly 700 European firms have financial ties worth $255 billion with businesses actively involved in Israeli settlements, according to a new civil society report.

The Don’t Buy Into Occupation (DBIO) coalition is a joint project between 25 Palestinian and European non-governmental organizations investigating the business connections between companies operating in illegal Israeli settlements in the Occupied Palestinian Territories (oPT) and European financial institutions. The coalition’s latest research found 672 European financial institutions had relationships with 50 businesses participating in Israel’s settlement economy. Between 2018 and May 2021, major European firms provided loans and underwritings amounting to $114 billion to these businesses while investing $141 billion.

“The involvement of these corporations with the settlements — through investments, banking loans, resource extraction, infrastructure contracts, and equipment and product supply agreements — provides them with the indispensable economic oxygen they require to grow and thrive,” Michael Lynk, UN Special Rapporteur on the Situation of Human Rights in the Palestinian Territory Occupied since 1967, wrote in the report.

The findings

The DBIO coalition found that the top 10 creditors collectively gave $77.81 billion to businesses involved in the Israeli settlements. These firms are BNP Paribas, Deutsche Bank, HSBC, Barclays, Société Générale, Santander, ING Group, Commerzbank, UniCredit, and Crédit Agricole. And the top 10 investors — Deutsche Bank, Crédit Agricole, Government Pension Fund Global (GPFG), Investor AB, BPCE Group, Allianz, Swedbank, Legal & General, AB Industrivärden, and Alecta — contributed $67.22 billion.

The coalition reached out to 138 firms as well as three corporations highlighted in the report and additional businesses the coalition found to be heavily involved in the settlement economy. Booking.com, BNP Paribas, and HeidelbergCement and 21 financial institutions responded to the report’s results.

Replies varied, with some banks wanting to set up meetings to further discuss the findings while other institutions said they’ve already investigated human rights concerns with their business partners. The report’s authors declined to disclose with which institutions they are meeting, but DBIO said they plan to publish updates in the future.

“Some of them claim they did their human rights due diligence, but still decided to be involved in a settlement enterprise, which is quite against any of the suggestions or analysis of human rights experts,” Dr. Anna Khdair — a legal researcher at Al-Haq, a Palestinian human rights organization, and one of the report’s co-drafters — told MintPress News.

Other institutions said any ties to Israeli settlements are not within their sphere of decision-making because settlements are legal under Israeli law. While they are warranted by Israel, settlements are illegal under international law.

“So, we still have a lot of work to do to explain how the settlement enterprise actually works and how much it is connected to the Israeli economy, [while] Israel itself will not provide enough information or transparency about those links with the illegal settlement enterprise,” Khdair said.

Holding corporations accountable

The Palestinian-led Boycott, Divestment and Sanctions movement has experienced incredible mobilization recently. American ice cream maker Ben & Jerry’s made headlines over the summer after announcing it will stop selling in Israeli settlements. Two pension companies named in the DBIO report also recently divested from companies linked to the settlement enterprise. In July, Kommunal Landspensjonskasse (KLP), Norway’s biggest pension firm, divested from 16 companies involved in Israeli settlements.

“In KLP’s assessment, there is an unacceptable risk that the excluded companies are contributing to the abuse of human rights in situations of war and conflict through their links with the Israeli settlements in the occupied West Bank,” KLP said in a statement regarding their decision.

The businesses from which KLP divested are:

  • Ashtrom Group Ltd.
  • Electra Ltd.
  • Alstom SA
  • Bank Hapoalim
  • Bank Leumi
  • Israel Discount Bank
  • First International Bank Israel
  • Bezeq
  • Mizrahi Tefahot Bank
  • Altice Europe
  • Partner Communications
  • Cellcom
  • Delek Group
  • Paz Oil
  • Motorola Solutions
  • Energix Renewable Energies

In September, the Norwegian pension company GPFG announced it will stop working with Elco Ltd., Ashtrom Group Ltd., and Electra Ltd. because of their activities in the Israeli settlements. In the last decade, Deutsche Bank, HSBC, and Barclays have also divested from some companies involved in the settlements.

Nonetheless, Willem Staes, coordinator of the DBIO coalition, noted:

Despite the illegal nature of Israeli settlements under international law, European financial institutions continue to throw a financial lifeline to companies operating in the settlements. European financial institutions should take up their responsibility and follow the example of KLP and GPFG. They should end all investments and financial flows into Israeli settlements, and not buy into the Israeli occupation.

Even with these divestment decisions, however, the aforementioned firms still associate with settlement-entwined businesses. KLP is invested in eight companies involved in the settlement enterprise: Delta Galil Industries, FIBI, Matrix IT, Mivne Group, Rami Levy Chain Stores Hashikma Marketing 2006, Shapir Engineering and Industry, and Shufersal. GPFG still has business dealings with 34 companies linked to the settlements. These businesses are:

  • ACS Group
  • Atlas Copco
  • Bank Hapoalim
  • Bank Leumi
  • Bezeq
  • Construcciones y Auxiliar de Ferrocarriles (CAF)
  • Caterpillar
  • Cellcom
  • CNH Industrial
  • Delek Group
  • Delta Galil Industries
  • DXC Technology
  • Energix
  • CETCO Mineral Technology Group
  • Cisco Systems
  • Expedia
  • FIBI
  • General Mills
  • Hewlett Packard Enterprise (HPE)
  • Israel Discount Bank
  • MAN Group
  • Tripadvisor
  • Manitou
  • Shufersal
  • Siemens
  • Matrix IT
  • Mizrahi Tefahot Bank
  • Volvo Group
  • WSP GLobal
  • Motorola Solutions
  • Partner Communications
  • Paz Oil
  • Rami Levy Chain Stores Hashikma Marketing 2006
  • Terex

These ongoing financial relationships put into question the firms’ commitment to human rights.

Maha Abdallah, one of the co-drafters of the report and the International Advocacy Officer at Cairo Institute for Human Rights Studies, told MintPress News that the DBIO’s findings definitely contradict the institutions’ purported ethical responsibilities.

“These companies and financial institutions claim that they’re committed to human rights, but then we see the facts on the ground and the level of their involvement in the settlements,” Abdallah said. “So clearly these are all in violation of their responsibilities under international law and towards human rights standards.”

Al-Haq’s Khdair speculated, however, that the slow pull-out from the settlement enterprise may stem from fears of political backlash. “We saw how the reaction from [the] Israeli government towards Ben & Jerry’s’ decision was,” Khdair said. “So some companies would be wary of reputational risk and also see [divestment] as problematic for their shareholders. It’s a process of finding the right balance in terms of their gains and their goals.”

All 50 companies named in the report participate in at least one of the activities listed by the United Nations as criteria for inclusion in its database of companies operating in the Israeli settlements. Of the 50 companies implicated, 15 are American. These businesses are:

  • Airbnb
  • Booking Holdings
  • Caterpillar
  • CETCO Mineral Technology Group
  • Cisco Systems
  • CNH Industrial
  • DXC Technology
  • Energix
  • Expedia
  • General Mills
  • HPE
  • Motorola Solutions
  • RE/MAX Holdings
  • Terex Corporation
  • Tripadvisor

Israeli settlements crushing Palestine’s economy

More than 600,000 Israelis live in settlements across the oPT and 42% of the West Bank is under settlement control. Area C of the West Bank abounds with natural resources, but 68% of this region is reserved for Israeli settlements while only 1% is designated for Palestinian use.

The continuous settler takeover of Palestinian land has prevented Palestinians from developing and utilizing their resources and therefore significantly depleted their economy.

Restricted access to the Dead Sea, quarries and mines has led to an over $1 billion annual loss in revenue for Palestine, according to a 2015 policy brief from Palestinian thinktank Al-Shabaka. And companies’ exploitation of West Bank quarries is estimated at $900 million annually. The DBIO report authors write:

The exploitation of natural resources means that the Palestinian people are denied their right to self-determination and permanent sovereignty over their natural resources. By profiting from the depletion of Palestinian finite quarry resources, individual corporate actors may be held criminally liable for complicity in the crimes of appropriation, environmental destruction and the pillage of natural resources.

European Union’s hypocrisy

The EU provided more than $40 million in humanitarian aid to Palestine in 2021. It also follows international law in declaring the Israeli settlements illegal. Yet the EU is Israel’s largest trade partner, with a total of approximately $36 billion in traded goods last year.

“There are conflicting interests even between different European institutions [each with] their [own] priorities,” Khdair said, explaining that the goals of foreign affairs units often clash with human rights entities in the EU.

The EU does not support the UN database on companies complicit in Israeli settlements and continues to block funding to update the resource over budgetary constraints. Yet again in contradictory fashion, an EU court also ruled in 2019 that consumers have a right to know if products sold in EU markets were made in Israeli settlements.

“On the one hand, the EU has a very consistent approach and position on the illegality of settlements and all the associated violations that come along with it that undermine Palestinian rights,” Abdallah said. “But at the same time, we’re seeing that European businesses and financial institutions are still freely and without any consequences are being involved and active with the settlement enterprise.”

For Abdallah, European business activity in the settlements seems in stark contrast to the EU’s stated allegiances to the Palestinian cause. “We know what that means in reality,” Abdallah said. “It means giving them an economic lifeline allowing them to sustain themselves and expand and grow with time because these settlements, at the end of the day, rely on money in order to prosper and sustain and expand.”

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