Ramallah – Maen Neroukh, owner and manager of an aluminum accessories factory in the West Bank, never imagined that the situation of his establishment and its annual profits would become dire after Israel launched its war on the Gaza Strip and the Palestinian territories following the Al-Aqsa Flood operation carried out by the resistance at the beginning of the last quarter, from which this industrial sector typically reaps its annual profits.
Neroukh employs, according to his statement to Al Jazeera, 30 people in the aluminum accessories company founded by his father in 1993, all of whom suffer from the political situation and Israel’s war on the Palestinian territories, forcing him to take measures to reduce expenses in the face of declining income. He reported that his establishment operates at about 40% of its capacity after production was cut by 60%.
The aluminum factory reduced production by 60% (Al Jazeera)
Losses of Two Months
According to the Palestinian Central Bureau of Statistics, the Palestinian industrial sector faced losses estimated in the billions of dollars in the first months of the war, as all forms of industry in Gaza halted, while factories and industrial companies in the occupied West Bank suffered major setbacks.
The Bureau estimated the economic losses in Palestine since the start of Israel’s aggression on Gaza at about 1.5 billion dollars, due to the near-total halt of production in Gaza and the repercussions on the West Bank, equating to around 25 million dollars daily, excluding direct losses in properties and assets.
The central statistics report on the industrial sector indicates that the value of production during the first two months of the war amounted to 452,573 dollars in the West Bank and 11,852 dollars in Gaza, meaning the Palestinian production was less than 500,000 dollars.
In the normal months, last year, production in the West Bank was 969,954 dollars, and in Gaza, 110,715 dollars, amounting to a little over a million dollars in Palestine.
The losses of the initial two months of the aggression amounted to 407,381 dollars in the West Bank and in Gaza 98,862 dollars, totaling 506,243 dollars in Palestine, according to the Bureau’s data.
Neroukh, a father of two, says he had to reduce various expenses and halted development and refurbishment of his house, and he might have to cut additional household expenses if the war continues.
Checkpoints and Closures
These situations, according to Neroukh, led to many problems and obstacles as a result of the war’s continuation—the most prominent being Israeli checkpoints and the increase in transportation and shipping costs internally between Palestinian cities and externally for importing raw materials, all of which added to production costs at a time when demand is declining due to the war.
On the distribution of products, Neroukh, whose factory supplies to the West Bank, says that checkpoints are their biggest obstacle—closure led to several issues including the inability of workers to reach their workplaces on time or delay in delivering products and commodities to merchants and agents in the provinces.
Truck drivers are forced to use difficult and sometimes dangerous routes, increasing the financial burdens on Neroukh’s factory, as trucks often return without delivering goods due to the occupation’s closing of barriers, or they take longer bypass roads to reach agents and complete delivery.
The price of the final product for the aluminum accessories factory increased due to the import of raw materials from countries including China, Italy, Spain, and Turkey. He pointed to the closure of ports at the beginning of the war, which raised the cost and therefore the prices of materials.
According to Neroukh, the new situations have led to delays in the arrival of materials from 20 days to 60 days, resulting in negative implications for exports to Jordan and the Israeli market, especially with the closure of crossings between West Bank cities and Israel, as well as border closures with Jordan.
Neroukh oversees the production at his factory (Al Jazeera)
Obstacles
In this field, Amin Zahir, secretary-general of the Union of Industrial and Commercial Chambers in Palestine, Samir Hazboun, tells Al Jazeera that the industrial sector, in all its forms, extraction or manufacturing, faces multiple problems, most prominently the checkpoints between provinces, and second, the closure imposed; thus, the difficulty of importing raw materials.
The third obstacle represented is the increase in transportation costs, whether internal due to the war and checkpoints, or external due to the closure of the crossings. The fourth is the difficulty of the movement of the workforce between provinces, Hazboun explained, noting that Palestinian industries are now operating at no more than 60% of their production capacity, while the majority of factories operate between 40 and 50%.
Hazboun mentioned other factors affecting the industry, including the rise in the exchange rate of currencies, especially those used in importing raw materials from abroad, and increased reliance on cash liquidity due to banking difficulties in dealing with checks and transfers.
Production Cutbacks
Returning to Neroukh, he says production quantities have dropped due to decreased sales, explaining that his factory is within the construction sector, which has almost entirely stopped, as well as building operations, even in private houses and buildings, because public sector employees and a significant part of the private sector do not receive their salaries. Additionally, Palestinian workers in Israel are prohibited from returning to their jobs, resulting in a halt in construction and building operations.
Neroukh also referred to a decrease in debt collection and an increase in the percentage of returned checks from agents and citizens.
Hazboun concludes that the continuation of these conditions, and after entering the fourth month of the war, has led to the collapse of Palestinian factories. In the stone and marble industrial sector in the Bethlehem governorate, only about 30 to 35 factories are currently operating out of 130.
Neroukh says that his company has borne all employee expenses since the outbreak of the war out of social responsibility, but it will not be able to continue if the war persists, reaching a point of having to lay off workers as the situation has become catastrophic.
The factory workers, who now work fewer hours, expressed their concerns to Al Jazeera about these circumstances affecting their livelihood, noting that they are fortunate so far not to have lost their jobs but are aware of the situation’s severity.
In this regard, Rakan Ibrahim Abu al-Hour, from a village near Bethlehem, says he considers himself fortunate to still have work, hoping that the situation will improve quickly.
Regarding the reality of the workers and job opportunities, Hazboun emphasized that this challenging environment weakens job prospects and creates unemployment.
