Coke factory to be built in Gaza
Construction of a Coca-Cola plant in northern Gaza has begun in early November 2014, potentially creating hundreds of jobs for Palestinians. Israel hopes that the new factory can drive economic growth in the strip with an estimated population of 1.8 million people, and decrease terrorism, Israeli media reported.
The project was green-lighted by Israel’s defence establishment and by the Palestinian Authority. The man behind the Coke venture in Gaza is the Palestinian entrepreneur Zahi Khouri, a founder and the Chairman of the Ramallah-based National Beverage Company, solely licensed for Coca-Cola in the West Bank. His company already operates Coca-Cola factories in Ramallah, Jericho and Tulkarm. The National Beverage Company, whose shareholders include other Palestinian firms and Coca-Cola Co. itself, made the decision to build in Gaza two years ago, Mr Khouri told Israeli media.
He is no relation to Nadim Khouri, who founded the Palestinian Taybeh brewery near Ramallah in 1994 (see BRAUWELT International no. 1, 2012, pp. 6–11).
“The only enemy of extremism is good jobs,” said Zahi Khouri. He expects construction of the Coke plant will take six months. Bringing Coca-Cola to Gaza will occur in two-phases, Mr Khouri explained.
The first phase, which will become operational in the third quarter of 2015, will focus on carbonated beverages, while the second, pegged for late 2016 or early 2017, will allow for the production of juices, water and other non-carbonated products.
Each phase will comprise a USD 10 million investment, and the factory is expected to create 120 direct and 10 times as many indirect jobs, though Mr Khouri believes direct jobs could number closer to 200.
Despite the fact that the National Beverage Company will operate a plant in Hamas-controlled Gaza, Mr Khouris insisted that his business will pay taxes only to the Palestinian Authority, thereby avoiding problems with terror-finance laws.
That may very well be true. But Israeli observers suspect that he may have to strike some sort of agreement with Hamas, otherwise he will not be able to get plant, equipment and necessary ingredients beyond the border crossing into Gaza. For “security reasons” all goods into Gaza used to be re-loaded onto different trucks 100 metres behind the border crossing. Guess who oversaw this? Besides, in Israel it’s a well-known fact that Hamas put a tithe of 20 to 50 percent on the value of all goods smuggled into Gaza through the tunnels.
Currently, there is only one soda factory in Gaza, a Pepsi plant, which reportedly produces 7-Up. Being the poster child of investment in Gaza, the plant was “officially opened” by the Palestinian leader Yasser Arafat several times, says one foreign correspondent.
Whether the new Coke plant will have an official opening or just go on-stream without much ado remains to be seen. It all depends on the political developments next year.
