SodaStream closing down its factory| Mishor Adumim Industrial Zone in the West Bank| Dec 1st 2015| Who Profits Research Center.
After SodaStream’s many announcements to withdraw from its factory in Mishor Adumim Industrial Zone, the company has now completed its withdrawal from its sole West Bank-based facility.
SodaStream withdrawal
(Who Profits) – On 1st of December 2015, Who Profits has conducted a filed visit to the SodaStream factory in Mishor Adumim aiming to verify the company’s withdrawal announcements. Based on the visual evidence obtained, Who Profits can confirm that the company is indeed finalizing its withdrawal from the West Bank. The decreased number of employees, the absence of goods, and the disassembling of parts of the factory all suggest that the factory has ceased to operate and that SodaStream has finalized its relocation and completed its withdrawal. Consequently, the company will be removed from Who Profits’ database.
This move comes after SodaStream was the subject of an intense boycott campaign by activists groups. However, on October 2015, the company’s spokesperson Nirit Hurwitz rushed to say that the move was based on economics not politics, as “The decision is purely commercial”.[1] This comes in accordance with SodaStream CEO Daniel Birnbaum’s earlier statement; “We won’t give in to terror. […] The considerations will be purely financial, and do not include the European boycott on manufacturing in the territories …We are not giving in to the boycott. We are Zionist.”[2] Both statements clearly reflect that SodaStream has no regrets over both its production activity in illegal Israeli settlements, and its exploitation of Palestinian workers.
SodaStream’s new factory has already been erected in the Idan Industrial Zone in Lehavim near the Palestinian Bedouin city of Rahat in the Naqab (Negev) desert in the southern part of Israel.
SodaStream’s new factory and the Israeli industrialization of Al-Naqab desert
To enable SodaStream’s relocation in Idan Industrial Zone in Al-Naqab, the government provided the company with a 25-million-shekel ($7 million) grant for construction of a new plant capable of housing all of the company’s production under one roof.
Generally, Israeli economic support of Israeli and multinational enterprises are regulated through its “Encouragement of Capital Investment” law. This newly amended law allows companies, such as SodaStream, to receive grants, enjoy tax exemptions, and use generous loans for their operations if they choose to invest in “peripheral areas”. According to article 40(C) of the law, the grant percentage given can reach its peak of 30% when “building a factory in the Negev”.
In the case of SodaStream, the “Israeli Investment Promotion Center” director Hezi Zaieg said that the decision on Sodastream’s grant was made on the basis of the amendment to the Law for the Encouragement of Capital Investments. He stated further that “The reform has proved itself. Sodastream had options to invest in other countries, but the tax breaks and grants in the new law makes an investment in Israel worthwhile compared with other countries.” This regulated policy lure private entities into investing and reaping profit in targeted areas while simultaneously fulfilling Israeli economic and strategic plans. SodaStream new plant in Idan Industrial Zone is a very clear example serving the Israeli industrialization planning in the Naqab.
In recent decades, the Israeli government has focused on the Naqab desert as the next location for its Israeli urbanization and industrialization projects. While supported also by the “Negev Development Authority” this Israeli policy is at the expense of the de-development of the Bedouin Native population and economy. According to current governmental publications, the coming decades in the Naqab desert will see rapid economic changes. In fact, in the upcoming years amounts exceeding 30 billion NIS will be invested by governmental and private entities into new Israeli industrial, military, and civil projects. Construction projects of a new military center and a new industrial park are already set in motion and will soon materialize into facts on the ground.
As development investments are poured into Israeli projects in the Naqab, the Bedouin economy suffers immensely from chronic deficit. Until today, Bedouins of the Naqab are the most vulnerable community in Israel, ranking at the bottom of the socio-economic ladder in Israel. For over 60 years, the indigenous Arab Bedouins have been engineered into a cheap labor class, facing a State policy of de-development, displacement, and dispossession of their ancestral land. As a result, they have been systemically denied a viable local economy.
SodaStream systematic exploitation of workers
“While we are enthusiastic about our new Lehavim facility and the exciting promise it brings to our company, we are committed to doing everything in our power to enable continuity of employment to our family of employees.” [3] This was a statement from SodaStream’s CEO Daniel Birnbaum. However, despite SodaStream’s statement that all workers “work side by side with equal wages, equal benefits and equal opportunities”, the discriminatory and exploitative working conditions in the company’s new facility continues. On September 2014, Bedouin women employees at SodaStream’s new factory in the Negev already complained that they are required to work 12-hour shifts in similar conditions to the plant in Mishor Adumim. Regrettably, while the company’s factory location may change, it remains an exploiter of Palestinian cheap labor.
Palestinian worker at the new SodaStream factory| Idan Industrial Zone, the Naqab (Negev) desert south of Israel| Sep 25th 2015| Source: Al-Jazeera website (link is external).
SodaStream was interested in transferring Palestinian cheap labor to their new plant, yet the majority of the workers were unable to do so because of the very long commute from the occupied West Bank and the difficulty in obtaining work permits from the Israeli government, which regularly prevents Palestinians in the West Bank free movement across its checkpoints. In addition to that, Israel “security” restrictions are another obstacle the workers confront; for SodaStream new factory only 37 out of the 130 Palestinian staff members from the West Bank factory actually met the Israel “security” requirements.
As mentioned this exploitation is not new to SodaStream, according to Kav LaOved (an NGO committed to protecting labor rights), between 2008-2010 the workers in the SodaStream factory suffered from harsh working conditions, low wages, and ‘revolving door’ employment policies.[4] In April 2008, SodaStream fired a group of 17 Palestinian workers, who protested their work conditions and low wages.[5] Following the publication of the story in the Swedish press and the intervention of Kav LaOved, they were rehired with better conditions, dismissed for the second time in 2010, and rehired again. However, two leaders of this struggle lost their jobs permanently. On July 2014, in their previous plant in Mishor Adumim SodaStream fired 60 Palestinian workers who complained about receiving insufficient food to break the Ramadan fast.[6]
Although SodaStream’s withdrawal is a step in the right direction it continues to abuse and exploit them as cheap labor. Not only does the company benefit and profit from its exploitative policies it also perpetuates a continuous state of de-development among the Palestinian native population in the Naqab.
[1]http://www.jpost.com/Israel-News/Politics-And-Diplomacy/SodaStream-to-relocate-its-sole-West-Bank-factory-380391(link is external).
[2] SodaStream to decide whether to shut down controversial West Bank plant, Ora Coren, Haaretz, 27 August, 2014. See: http://www.haaretz.com/business/.premium-1.612799(link is external).
[3]http://www.jpost.com/Israel-News/Politics-And-Diplomacy/SodaStream-to-relocate-its-sole-West-Bank-factory-380391(link is external).
[4] “Employees at Soda Club Fired Without Wages”, Salwa Alinat, Kav LaOved, April 27, 2010. See: www.kavlaoved.org.il/media-view_eng.asp?id=2797(link is external).
[5] “Multi-Culturalism at the Soda Club Factory”, Salwa Alinat, Kav LaOved, May 2, 2009. See:www.kavlaoved.org.il/media-view_eng.asp?id=2262(link is external).
[6] Ramadan dispute leads to SodaStream dismissals, Haim Bior, Haaretz, July 24, 2014. See:http://www.haaretz.com/business/.premium-1.606304(link is external); How does SodaStream treat its Palestinian workers when the media isn’t looking? Niv Hachlili, 972 Magazine, July 24, 2014. See: http://972mag.com/when-the-media-isnt-looking-how-sodastream-really-treats-its-workers/94215/(link is external).
Originally appeared at Who Profits