A beach in northern Greece (photo: Revital Mozes)

Timing was no coincidence. Soaring temperatures and baking-hot afternoons in the eastern Mediterranean mean that the soundest thing to do is to look for a relaxing refuge. But this time around, due to the sinking relationships between Israel and Turkey, the holiday map is being redrawn, with all players trying to cash in.

Until 2008, about one million Israelis visited Turkey each year, of whom hundreds of thousands did so during summer, heading to all-inclusive resorts along the Turkish Riviera. But then came Prime Minister Recep Tayyip Erdogan’s outburst at Davos towards the Israeli president Shimon Peres and his call to bar Israel from the United Nations, causing offended Israelis to look for other options.

“Tourism to Turkey this year has virtually disappeared,” says Galit Zakay, marketing manager for Eshet Tours travel agency, adding that “the last straw was the Turkish reaction to the battle with Israeli soldiers aboard a Gaza-bound ship”, which ended in nine Turkish deaths. Israelis watched their flag burning in Istanbul, and sensed that Erdogan was trying to achieve hero status in the Arab world through attacking their country, and decided to rethink their holidays.

The Turkish daily newspaper Hurriyet estimated last week that the loss for the Turkish tourism industry would be $400m, so the competitors were quick to offer alternatives.

“As with any other product on the shelf, when one leaves the market, others try to fill its place,” says Louisa Varaclas, director of the Cyprus Tourism Organisation in Tel Aviv. Sensing the opportunity, she brought more than 50 hoteliers and businessmen to Israel at the end of June, and says the reaction was “enthusiastic”.

And that’s not all. New charter flights began recently to Corfu and to Paphos, and tourist retailers are now providing attractive deals to Crete, Rhodes, Bulgaria and Palma de Mallorca.

When it comes to size, though, Israel is in apparent deficit, and the Turkish tourism minister was quick to say last week that “Turkey expresses itself in millions and Israel in thousands”. But still, a group of prominent Muslim religious leaders, including the leading Sunni cleric Yusuf al-Qardawi, thought it’s important enough to call upon “families and groups planning to travel to Europe, the US or elsewhere, to choose Turkey as a vacation destination instead”. Here, it seems, vacations are never just about getting a tan.

(Published originally in Monocle on July 8th).

Finance Minister Yuval Steinitz

The OECD has hailed “Israel’s scientific and technological policies” that have produced “outstanding outcomes on a world scale”. Despite huge waves of immigrants from underdeveloped countries in the past six decades and even though a constant security threat has drained a large portion of the annual budget, Israel apparently boasts a much healthier economy than many of its new colleagues.



Israel’s economy grows much faster than in most developed countries (5 per cent annual average between 2003 and 2008), and its unemployment rate, currently at 7.3 per cent, is lower than the EU’s 9.6 per cent. In fact, analysts say, if it was only down to economics, Israel should have been admitted to the club much earlier.

Joining the prestigious group, therefore, was more of a political matter, something the Palestinian prime minister, Salam Fayyad, understood. To Israel’s dismay, Fayyad (together with an Arab-Israeli Member of Parliament) campaigned against Israel’s inclusion.

Some Israeli critics have warned against euphoria but the overall reaction is one of jubilation. The Jerusalem Post wrote that it is “undoubtedly a victory for the embattled Jewish State”, while the left-leaning Haaretz suggested that “the timing says it all: this is what Prime Minister Netanyahu is getting from the international community in return for starting proximity talks with the Palestinians.”

The economic analyst of Israel’s most-read daily, Yedioth Ahronot, went so far as calling it a “historic moment”, since “for a state that is merely 62 years old, with a population of a mere 7.5 million and which so many would like to destroy, full membership in OECD is an act with deep national and international significance”.

Joining the OECD will hardly affect the lives of ordinary Israelis - at least not in the near future. According to the Israeli Finance Ministry, the most important outcome would be the possibility to attract bigger loans and on better terms.

”The significance is more diplomatic,” says Daniel Doron, founder and director of the Israel Center for Social and Economic Progress, who has served as an adviser to Benjamin Netanyahu since the early 1990s. “There is a lot of hostility today towards the State of Israel in Europe, and this could help in toning it down. On the economic side, it is an important step of course, but we must remember that Greece, for example, is a proud and veteran member of the OECD, and it didn’t really help it in the current crisis.”

OECD secretary general Angel Gurría added a note of caution, saying that Israel has to tackle its high poverty rate. But still, at least for one day, Israel felt that the western democracies saw it as a thriving and free nation.

(Published originally in Monocle on May 12th)

Offshore natural gas drilling

A report just published by the United States Geological Survey (USGS) suggests there may be 122 trillion cubic feet of natural gas in the area between Israel, Cyprus and Lebanon. That is more gas than the whole world consumed and produced in 2008, and according to the agency, it is “bigger than anything we have assessed in the United States”. According to these estimates, only half of the potential gas belongs to Israel and then there’s the problem of how to drill for it successfully and carry it to shore.

But now the Israeli government has confirmed that the Russian energy giant Gazprom is negotiating for drilling licences in the few gas fields that are already operational in Israeli waters. But nobody believes that such a big player would want to come to Israel unless it was convinced there was more potential than that. All of these events have electrified the sector.

Until 2009, Israel was almost entirely dependent on energy imports. But then gas fields were found, attracting local moguls such as Isaac Tshuva, owner of the Plaza Hotel in New York, and also global players such as Noble Energy, whose CEO Charles Davidson said last month that “Israel is now the best place to be in”.

Finding adjacent gas fields increases the probability of finding even more in the same region, and the Tel Aviv stock exchange reacted accordingly. The value of gas-related companies has soared 720 per cent since the beginning of 2009.

And the economic implications for Israel are huge, says Amit Mor, CEO of financial consultants Eco Energy.” The benefit to companies such as Israel’s Electric Corp of not needing other energy sources would save them tens of billions of dollars over the next 20 years.”

But this gas rush also has far-reaching strategic implications, says Dr Shmuel Even, an economist specialising in Middle East energy and security issues. “Becoming independent of energy import is a historic revolution for Israel,” he says, “especially because of its geographical location in an unstable region.

Some critics warn of a gas speculation bubble. But even more interesting is that Israel’s lack of natural resources has actually been one of the main causes of its economic success - it forced policy makers and businessmen to be ever more innovative and focus more on science and technology. It will be a challenge for Israel to become self-reliant in its energy policy, and still retain its competitive edge. But that would be a nice problem to have.

(Published originally in Monocle on April 24th)

Joe Biden (photo: Munich Security Conference 2009)

The list of dignitaries stopping by in the last two months alone includes national security adviser Jim Jones, CIA director Leon Panetta, Senator John Kerry and chairman of the joint chiefs of staff, Admiral Michael Mullen. Topping them all off is Vice President Joe Biden, who finished his five-day visit last Friday.

The hunch that something big is going on is underscored by the simultaneous high-profile visits in Washington of Israeli defence minister Ehud Barak (in February) and of Gabi Ashkenazi, the chief of general staff (right now).

The most common explanation for all this commotion is that the US is using all its clout to prevent an Israeli attack on Iran’s nuclear facilities, so as to let the diplomatic course bear its fruits. “One of the reasons so much dialogue is taking place,” said chairman of the Senate Foreign Relations Committee John Kerry, while he was there, “is to make sure we are all on the same page.”

Or are we? The word lately in Jerusalem and Tel Aviv is that something completely different is taking place behind the scenes. A worrying scenario, in Israeli eyes, is that the western negotiators, headed by the US, have succumbed to the idea of a nuclear Iran. And despite putting up a façade of strongly rejecting an Israeli attack, the latter would actually fit quite well with their interests.

“An Israeli attack on Iran would actually have some clear advantages for the western states,” says Dr Emily Landau from the Institute for National Security Studies. As director of the Arms Control and Regional Security programme in the influential think-tank, she says that such a development would take the heat off the West and divert attention from the fact that its efforts to stop Iran have failed.

An attack would most likely cause at least some damage to Iranian facilities and would enable the US the possibility to step in and restore stability in the region, thus shoring up much-needed foreign policy points. Last but not least, all blame for inflaming the region would be directed at Israel. “Officials, whose statements were previously in the vein of, “Oh no, Israel cannot be allowed to attack!” are now beginning to sound as if they mean: “Israel cannot refrain from attacking.”

In his public speech yesterday at Tel Aviv University, vice president Biden has said, to much applause, that “the United States is determined to prevent Iran from acquiring a nuclear bomb”. The question, some people here ask, is whether he wants that to be done by proxy.

(Published originally in Monocle on March 13th 2010)

Brigitte Bardot

Bardot’s foundation is just one of many international animal rights organisations watching closely as Israel prepares to pass a bill that would make it the first fur-free country in the world.

Already hailed as “an historic event”, the bill will ban importing, producing and selling of fur and fur items from all mammals, except for fur on shtreimels, the fur-trimmed hats worn by married ultra-orthodox Hassidic Jewish men. While each of those hats is made of no less than 24 fox tails, their wearers number only a few thousand.

Most Israelis find fur items unsuitable for the Mediterranean climate, and according to Eti Altman, who spearheaded the efforts to enact the new law, “the fur industry in Israel is worth only $1-2m [€730,000-€1.4m] annually”. Still, when she conducted a recent poll on behalf of the NGO she co-founded “Let the Animals Live”, she discovered that 86 per cent of the population believe that killing animals for their fur is immoral.

A TV documentary broadcast last year on Israel’s channel 10 raised people’s awareness to the suffering of animals. The programme also revealed that some clothing articles, which were sold by leading Israeli brands as made of synthetic fur, were actually made of dog and rabbit fur. The outcry following the broadcast prompted two members of the Knesset to propose the new law.

Despite the fact that a ban in Israel would have little impact on the economy, it is still fraught with tension because of the symbolism of the decision. A vote planned earlier this week was aborted at the last minute.

“Israel can afford to be a pioneer, as its economy will hardly feel it but for the world it’s an important message,” says Jane Halevy, head of the International Anti-Fur Coalition, an umbrella organisation of more than 60 anti-fur organisations worldwide.

The global fur trade, according to Halevy, is worth $16bn (€11.7bn) annually (with China and Russia as the biggest consumers), and one of the main reasons why Israel is leading the way is that there are almost no economic interests involved. The only question that remains is whether this precedent can outweigh other considerations even where more money is at stake.

(Published originally in Monocle on March 11th 2010)

7 of the suspected assassins (photo: Dubai police)

Mahmoud al-Mabhouh was assassinated in his hotel room in the emirate exactly a month ago on 19 January, and his death could have gone almost unnoticed if not for the hotel’s closed-circuit cameras. Images of the 11-member hit squad, caught by those cameras, were beamed around the world three days ago, together with names and passport numbers of the alleged assassins. European governments were quick to announce that the passports were forgeries and that the Israelis who they really belong to had had their identities stolen and were not involved in any plot. All fingers are now pointing towards the all-mighty Hollywood-style Israeli espionage agency, Mossad.

As a matter of policy, Israel prefers to leave unanswered questions about its involvement in special covert operations. It never took responsibility for the attack on a nuclear site in Syria in 2007, nor for the death in a car bomb of senior Hezbollah official Imad Mughniyah in Damascus in 2008 - both of which are attributed to its security forces. In fact, officially Israel doesn’t even have a nuclear bomb.

Mabhouh’s being a target is not surprising. A founder of Hamas, he recently admitted to masterminding the killing of two Israeli soldiers in the 1980s. More importantly, according to intelligence reports, he was in charge of the smuggling of Iranian long-range rockets into Gaza, enabling Hamas to threaten the Tel Aviv metropolitan area. Many believe that any confrontation between the international community and Iran would lead - or might even begin with - a barrage of missiles fired towards Israel from Gaza and the Lebanon. Mabhouh certainly seems to have had an important role in the Tehran-Hamas-Hezbollah triangle. Interestingly, on 16 January, the Egyptian daily Al-Ahram, considered to be the government’s mouthpiece, hailed the head of the Mossad, Meir Dagan, as a “superman”, for his covert operations against what it said were Iranian attempts to destabilise the region.

But still, say some ex-Mossad officials, something just doesn’t add up. The fact that so many Israeli citizens were quickly connected to the operation, together with the embarrassment caused to friendly European governments by using fake passports, suggests recklessness on behalf of the Mossad, or even plain stupidity. Why would the Mossad use the names of Israeli citizens and incriminate itself so clearly?

Intelligence analysts say that this would be the first time the Mossad had used Israeli citizens’ identities in an operation. In fact, Israel’s most famous spy, Rafi Eitan, who was responsible for locating Adolf Eichmann in Argentina and bringing him to trial in Israel in the 1960s, yesterday told Israeli radio that “some foreign service wanted to taint Israel. It took the names of Israeli citizens, doctored the passports and thus tainted Israel.” Perhaps.

In the meantime, the political fallout is being felt especially hard in the UK, where Prime Minister Gordon Brown has called for an investigation and the Israeli ambassador was asked to come in to “share information” about the fake passports.

Israeli and British intelligence services are known to cooperate closely, and political and diplomatic efforts are made to keep it just like that. After all, in the murky business of espionage, almost anything goes until you get caught - or for that matter, pictured.

(published originally in Monocle on February 18th 2010)

Japanese schoolboys (photo: abucho)

Appearing on TV last week, Saar suggested that uniforms improve the atmosphere inside schools, by increasing equality and creating a sense of shared pride. But, he said, his ministry is considering placing closed-circuit cameras inside schools in the near future.

Until 25 years ago, all Israeli schools had uniforms, but liberal educational approaches have since favoured more and more “freedom to the pupil”. The choice of whether to make uniforms compulsory was left to each school and as a result they all but disappeared. It has become very difficult for schools to punish children by sending them home or expelling them from a class. It is more common these days that parents call teachers to complain over perceived inadequacies in the curriculum or the treatment of the children.

When it comes to higher education, especially in technology related areas, Israelis tend to do especially well. In their recently published bestseller Start-Up Nation, Dan Senor and Saul Singer mention that the number of patents registered by Israelis between 1980 and 2000 was 7,652 (77 for Egyptians and 20 for Syrians).
But when you look at elementary school, the situation is not so good. Comparative international exams point to deteriorating performance of Israeli children, and the last PISA results, conducted by the OECD (Organisation for Economic Cooperation and Development), have showed that Israel ranks 39th out of 57 countries.

Saar says that in order to change course, you need to have “a climate of learning” in schools, and that an effective educational system can be achieved only if you put boundaries in place and strengthen teachers’ authority. His critics counter that this is merely cosmetics and that he should start by increasing teachers’ salaries in order to attract the best possible personnel.

Etti Wolf, who’s been running an elementary school in northern Israel for the last 20 years, says that reintroducing uniform is an important and useful tool. Children in her school already wear uniforms, and this, she says, helps in creating the right atmosphere. “Ten-year-old boys and girls come to school with the most fashionable clothes you can find,” she says, “and that’s part of the environment - that everything is permitted. In my school I am very strict: if someone comes without uniform, their parents must come and bring it to school.”
Two years ago, one of the teachers in her school suggested that the staff should wear a sort of uniform too. The point was to set an example. Trousers or skirts could be any type but shirts had to be either black or white. The regime lasted only a year, she says. The reason? The teachers rebelled.

(published originally in Monocle on January 30th 2010)

Justice Dorit Beinisch

Beinisch made this official statement in her ruling this week against the Israeli Army’s decision to close a road for Palestinian vehicles, for security reasons. The Israeli Supreme Court, which enjoys a high reputation among its peers in the democratic world, has ruled many times against the army and other state organs. But this seems to be the first time Beinisch adds her voice to the “Apartheid debate” and in such a clear way.

Closing roads for Palestinian vehicles in the West Bank is one of the main issues raised by those who call Israel an “Apartheid state”. For them, such an act is segregation, and segregation means Apartheid.

In her ruling, Beinisch denounced categorically the comparison between the former South African regime and the State of Israel. She reminded the petitioners in the case that Palestinian terrorists attacked vehicles driving the relevant road numerous times, and that many civilians have lost their lives in that way. In any case, she said, the army’s decision was motivated by security concerns and not by racial superiority.

A synopsis of the ruling is available in English but the full ruling is available for now only in Hebrew. Here is my translation of the paragraph Beinisch wrote about Apartheid:

“Even if we take into account that an all-out separation between populations using the roads is an extreme and unwanted outcome, we should be careful and restrained when using definitions that refer to security measures - adopted in order to protect persons travelling on the roads - as segregation, based on improper reasons of race and ethnicity.

“The comparison made by the petitioners between the use of different roads because of security reasons, and the Apartheid policy of South Africa, is improper.

“The Apartheid policy is a very grave crime. It contradicts the basic principles of the Israeli law, as well as the international human rights law and the international criminal law. It is a policy of racial segregation and discrimination, consisting of a range of discriminatory practices, in order to create supremacy of one race and to subjugate other races.

“The stark contrast between the security measures taken by the State of Israel as protection from terror attacks, and the unacceptable practices of the Apartheid policy, demands avoiding any comparison or use of this harsh expression (underlining is mine, A.S.).

“Not every distinction between people, in all circumstances, is necessarily an improper discrimination, and not every improper discrimination is Apartheid. The use of the word Apartheid lessens the gravity of this crime, which the entire international community fought against and which we all condemn.

“Therefore, the comparison made by the petitioners between preventing the traffic of Palestinian inhabitants along road 443 and the crime of Apartheid was so extreme and radical that there was no basis for raising it at all”.

Sheldon Adelson

In July 2007, Sheldon Adelson made local media barons and journalists tremble when he launched a free week-day Israeli newspaper, Israel Hayom. Adelson is a US-based casino magnate whose fortune in 2008 (before the recession) placed him at the top of the list of wealthiest Jews in the world. He is a well-known philanthropist and donor to Jewish institutions here and abroad and is also known to be a confidante and backer of Prime Minister Benjamin Netanyahu.

Indeed, the owners of the country’s national paid-for newspapers had reason to believe that Adelson was simply using Israel Hayom to help Netanyahu win this year’s elections. And once the elections were over, they hoped, their agony would end too and the 76-year-old billionaire would return to his estate in Las Vegas.

Adelson, it seems, had a different plan in mind: and one that threatens the existence of the paid-for press. Over the course of this year, he has made Israel Hayom the second largest newspaper in Israel in terms of circulation and taken a 25 per cent share of the national newspaper readership. Distributed mainly in train stations, Israel Hayom, according to all accounts, is not yet a profitable business, and Adelson channels millions of dollars into it, which is still just a small slice of his fortune. Its progress could hardly have come at a worse time for Israeli newspapers struggling to survive the economic crisis and dwindling advertising budgets.

But then came another body blow to the old barons when, in November, Adelson launched into the weekend market. Starting with 100,000 copies, the print run grew to 150,000 within two weeks, and then to 250,000 copies after another two weeks. And in addition to distribution at stations, the newspaper is now delivered free to people’s homes.

The barons are trying to fight back. If they don’t, 2010 could well be a dramatic year for newspapers in Israel, because two of them - Maariv and Haaretz - are in danger of closing down. So on 16 December, a group of MPs proposed a law which would bar individuals who do not hold Israeli citizenship from owning a newspaper. The law would also mandate that the controlling interest in a newspaper is held by an Israeli citizen who is a resident of the country. That would effectively put pay to Adelson.

“Owning a newspaper is not like owning a toothpaste factory,” says Daniel Ben Simon, a former Haaretz journalist and now a member of parliament, who is one of the initiators of the new law. “Journalism has a role in a democratic country and letting an outsider, who made his money in casinos, take over this sensitive industry would be a mistake.”

Ben Simon, needless to say, is a member of Labour, and not of Netanyahu’s Likud party. Indeed, the initiative seems less occupied with defending democracy and more with a fear of Adelson.

“The new law is not reasonable,” says Dvorit Shargal, who runs the independent media monitoring blog Velvet Underground. “All newspaper owners have financial and other interests. The real problem might be that the Hebrew reading market is relatively small, and it cannot sustain all these papers.”

While the free paper model has experienced difficulties in many markets (such as London), in Israel it has the potential to create dramatic headlines in 2010. Who will be left standing in 12 months is far from clear.

(published originally in Monocle on December 25th 2009)

Marwan Barghouti

Hamas’s insistence on the release of Barghouti is a well-calculated political move to show its people that they are also concerned with prisoners affiliated to rival Fatah. Some Palestinian observers, however, believe that Hamas would like to see him remain in an Israeli jail, as his popularity poses an electoral menace.

The 50-year-old former Fatah leader, who was imprisoned by Israel in 2002 on charges of murdering Israeli civilians and attacks on Israeli soldiers, exerts great influence in Palestinian society from his cell. In contrast to the weak style of the current Palestinian leader, Mahmoud Abbas, Barghouti is a charismatic figure and someone who has paid a heavy personal price for his views and actions.

For Israel Barghouti could prove useful too. At the moment politicians here are either faced by radical Hamas leaders who it finds impossible to negotiate with but who enjoy high popularity, or by Fatah leaders, who it is able to negotiate with but enjoy almost no popular support. Barghouti might be flexible enough for the Israelis and still be strong enough in the eyes of his people to carry them through difficult negotiations.

Last week Barghouti gave an interview to the Italian daily Corriere della Sera that was full of mixed messages. On the one hand, Barghouti said that Abbas’s mistake was to bet all his cards on negotiations with Israel, thus hinting that he would like to resume terror attacks and military operations. On the other hand, when asked what his goals were, Barghouti manifestly omitted the Palestinian refugees’ right of return - one of the main sticking points in the negotiations.

Judging by past experience, Israelis will be less concerned with his previous activities than with his future plans. The former Egyptian president Anwar Sadat was responsible for far more Israeli deaths than any Palestinian leader. Still, when he decided to change course and to accept the presence of a Jewish state in the Middle East, he was awarded with all he wanted, which was the whole of the Sinai Peninsula. Many Israelis believe that if Barghouti is brave enough to tell his people it’s time to end the conflict, he might be rewarded with a similar land deal.

(published originally in Monocle on November 28th 2009)