Jun. 3, 2016
- Israel Boycott Is Failing When Measured by Main Economic Gauge – Sangwon Yoon
Foreign investments in Israeli assets hit a record high last year of $285.12 billion, a near-tripling from 2005 when the boycott, divestment and sanctions (BDS) movement was started by a group of Palestinians. Money managers, economists and government officials say Israeli assets are an attractive alternative to weak performers elsewhere. The country’s economy is slowing but growing faster than those of the U.S. and Europe and its interest rate is higher. Plus, many reject the notions driving the boycott – that investing in Israeli innovation and natural gas violates Palestinian rights, and that Israel’s misdeeds are so exceptional that they justify singling it out for censure.
Israeli startups raised $3.76 billion last year from non-Israeli investors, the highest annual amount in a decade. Foreigners spent an additional $5.89 billion acquiring them. A survey of nine Israeli companies with ties to settlements showed major non-Israeli holdings have increased or remained largely unchanged over the past three years. The increase easily made up for a handful of divestments such as Barclays Plc’s sale of its 50,000 shares in Elbit Systems in 2014, worth about $3 million.
One fund manager said that while state pension funds in northern Europe have opposed investing in companies linked to Israeli activities in the West Bank, many others in China and elsewhere simply want assets with good management, high dividend yields and healthy balance sheets. (Bloomberg)