Living here in Silicon Valley, one of the world’s wealthiest areas and home to thousands of affluent tech entrepreneurs, it is hard to imagine life in the Occupied Palestinian Territory. Life there is fraught with power outages, water restrictions, lack of medical supplies, an education system that has been weakened by bombings and forced closures, and high unemployment. Yet a few years ago, the New York Times ran a highly optimistic piece entitled, “West Bank’s Emerging Silicon Valley Evades Issues of Borders.” One major barrier faces Palestinians, however: PayPal does not service Palestinian businesses in the West Bank and Gaza.
On Aug. 24, a group of over 40 Palestinian businesspeople in Silicon Valley wrote the CEO of PayPal and requested that he remove this obstacle.
They claim PayPal’s absence is problematic for the Palestinian economy overall because IT is one of the only sectors with the potential to grow under conditions of the Israeli occupation. IT products do not require many physical inputs or have to cross physical borders, so they are less impacted by Israel’s severe restrictions on the movement of Palestinian goods and people.
The Occupied Territory has benefitted from foreign investment. For example, Cisco has invested $10 million into the region, expanding the IT sector by five times. This kind of growth is essential to an economy forced to operate under near impossible conditions.
A report issued this year by the World Bank notes that any idea of a secure Palestinian state will be dependent on a strong and independent economy. The lack of a developed IT system is one of the biggest impediments to achieving such a goal.
According to the report, although “Israel recognizes that the Palestinian side has the right to build and operate separate and independent communication systems and infrastructures including telecommunication networks, a television network and a radio network,” the Bank found “the presence of widespread, unauthorized activity by Israeli operators in the West Bank with mobile broadband capabilities has the effect of creating unfair competition at the expense of Palestinian operators.”
The 63-page report estimates revenue losses to the Palestinian telecom sector as high as $1.15 billion in the past three years alone.
Contrast this loss with the promise that the Portland Trust found in the territory. A 2013 piece highlights the ICT sector as one of the areas that are most important to the Palestinian economy: “…by 2030 the sector could expand as much as nine-fold, to approximately $960m in output and directly employ up to 20,000 people in high-skilled jobs.”
The Palestinians’ letter to Dan Schulman, CEO of PayPal, states, “We are writing to urge you to extend PayPal’s services to Palestinians living in the West Bank and Gaza thereby removing a major limitation on the Palestinian technology sector, one of the only bright spots in the overall economy.
“More importantly, extending PayPal services would resolve the current discriminatory situation whereby PayPal’s payment portal can be accessed freely by Israeli settlers living illegally (per international humanitarian law) in the West Bank while it remains unavailable to the occupied Palestinian population.”
Zahi Khouri, CEO of Palestine’s National Beverage Co., said, “All we want is equal access for our talented young people to bring their innovative products and ideas to the world.” He wrote that “by extending service to Palestine, PayPal has the opportunity to make a real contribution to alleviating the disastrous unemployment rates in Palestine which are a major source of instability.”
David Palumbo-Liu is the Louise Hewlett Nixon Professor at Stanford University and is part of a Silicon Valley group working for Palestinian rights. This term he is co-teaching a course at Stanford entitled “Making Palestine Visible.” He wrote this for The Mercury News.
