Published On: Wed, Jul 2nd, 2014

Israel is Replacing Syria as the Overland Transit Point for European Goods Shipped to the Arab World

Israel is benefiting in some ways by the strife in Syria.

 

shipping Trade,    Port,    Illustration

 

Israel is becoming a conduit for the transfer of exports from Europe to the Arab World. European products and produce make their way to Israel by sea and from there are sent overland to Jordan. Jordan, in turn, send the goods to other Arab nations.

As international news service Reuters has pointed out, previously all such European goods would have gone through Syria. But three years of violent civil war has left that country unsafe for overland transport.

Ismail Hamad, a 58-year-old Romanian driver, once drove trucks filled with European goods across Syria, but now does it in Israel instead. As he told Reuters, “Too much problems, too much guns, too much fighting, ”

The trucking traffic between Israel and Jordan has tripled since 2011, to 10, 589 trucks a year, according to the Israel Airports Authority. Turkey is also relying on Israel as a conduit for its exports to the East.

It is also cheaper and faster to send exports through Israel instead of Egypt. In Egypt the goods would need to be shipped overland and then by sea once again.

Since countries like Iraq and Saudi Arabia do not recognize Israel, the shippers do not list Israel on their paperwork. Documents only mention the goods’ point of origin.

The Israeli government has decided to invest 6 billion NIS ($1.7 billion) to improve the infrastructure along the Haifa/Jordan trade route over the six years. These improvements, it is hoped, will allow for an increase in trade.

The country intends to build two $1 billion ports to be operated by foreign companies, one in Haifa and the other in Ashdod. The new Haifa port is expected to have a capacity for 1.5 million containers a year which would double current levels.

A new rail line that cuts eastward across Israel’s Galilee from Haifa to Beit Shean, which is located just across the Jordanian border, will be completed this year. It is hoped that by 2017 trains will be able to carry the goods all the way from Haifa to the Jordanian border.

Israel has “not even begun to scratch at the potential, ” the Foreign Ministry’s Ravia-Zadok told a recent economic conference.

Israel earns profits through the port fees and other taxes charged to the international firms who are transporting the goods. It also benefits from the work that the trade provides Israelis. But the Port of Haifa may not be modern enough to handle any more increases in trade.

It takes much longer than in other ports for ships to unload their cargoes in Haifa. This is largely due to security inspections. Such inspections also cause a problem on the return trips.

When the trucks cross into Jordan they do not need to go through a security inspection on their way out of Israel. But they do have to on their way back into Israel. The wait can take all day.

Shlomi Fogel, owner of the Haifa-based Israel Shipyards, has a plan to make such trade simpler. He wants to expand an already existing customs-free zone along the Israel-Jordanian border where cargo can be dropped off or picked up from either side 24-hours a day. Israeli has already allocated 60 million NIS ($17 million) for a new bridge into the free trade zone and is waiting for Jordanian approval.

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