Bethlehem Business Reborn as Christmas Tourism Boosts Palestine Statehood

Azur Murad is opening a gourmet food store on Bethlehem’s Star Street in time for Christmas, joining 11 other shopkeepers encouraged by Palestinian Authority incentives to boost business in the biblical town.

“We want to bring special things here to make this street successful,” said Murad, 52, pointing to cheeses from France and olives from Greece and the West Bank.

Her optimism is a sign of the rebirth of Bethlehem, where 80 shops -- 12 of which opened this year -- line the street that runs into Manger Square and the Church of the Nativity. The quarter was almost deserted three years ago following the second Palestinian uprising against Israel’s presence in the West Bank and the Gaza Strip, which led almost everything to close.

Boosting tourism in the West Bank is part of Prime Minister Salam Fayyad’s plan to have all institutions needed to run and finance a state operational by the middle of next year. As U.S. efforts to get Israel and the Palestinians to the negotiating table stall, the authority’s ability to create a vibrant economy may help its quest for international recognition.

In Bethlehem, store owners were encouraged this year by tax exemptions, the municipality’s waiver of licensing fees and monthly stipends of $200 to those who took the steps into entrepreneurship.

“Bethlehem has a huge weight, culturally and religiously, and this is why it is an area receiving great attention from the Palestinian Authority,” said spokesman Ghassan Khatib. “Tourism is one of the main sources of income for the future Palestinian state and for Palestinians now, and we are doing our best to utilize this opportunity.”

Law and Order

The city has better-trained police on the streets and the sewage systems have been improved, according to the authority. President Mahmoud Abbas and his government have forsworn violence and deployed U.S. and Jordanian-trained police forces throughout the West Bank to keep law and order.

The West Bank and Gaza Strip economies are both heading for growth of 8 percent in 2010, up from 7.2 percent in the West Bank and 5.4 percent in Gaza last year, the International Monetary Fund said in September. The Tourism Ministry expects the industry this year to account for as much as 15 percent of the Palestinians’ gross domestic product, projected by the IMF to be about $7 billion this year.

Tourism is up, with 1.45 million visitors to Bethlehem, 60 percent more than in 2009, the Palestinian Tourism Ministry said. About $250 million has been spent in the city’s hotels, restaurants and shopping centers, up 60 percent from a year ago and accounting for about a third of all Palestinian tourism revenue, the ministry said.

Star Street

Jack Giacaman, who makes and sells olive wood and seashell souvenirs, attributed the busy tourist season to the authority’s push to reduce violence. “This encourages the economy to grow,” said Giacaman, whose family has lived in Bethlehem for five generations.

The merchants on Star Street, which residents believe was the route that a pregnant Mary and her husband Joseph took into the ancient town, are optimistic about the future.

“We hope this street will become like the Damascus market and a tourist street in Cairo,” said Sameh Nofal, a 60-year-old dentist who is also chairman of the street committee.

Nofal’s committee, working with the authority, the municipality and the Chamber of Commerce and Industry, has plans for a trolley to run up and down the street, a tourist information center, and music and theater performances.

Jobless Rate

Unemployment in the town is down 2 percentage points to 22 percent from last year, compared with a jobless rate of 45 percent between the end of 2000 and 2004, said Samir Hazboun, chairman of the Bethlehem Chamber of Commerce.

More of the tourists who visited Bethlehem stayed overnight this year, leading to a 45 percent increase in hotel stays from 2009, Tourism Minister Khouloud Daibes told reporters last week. The Palestinians’ share of tourism revenue from visitors to Israel and the Palestinian territories has risen this year to 10 percent, from 3 percent to 5 percent in past years, she said.

Israel’s Tourism Ministry is expecting a record 3.5 million tourists this year, 2.4 million of them Christian. Last year 2.7 million people visited Israel.

“This year there were a lot of people here from everywhere and we hope it will continue like this,” said Marina Hosh, standing inside the coffeehouse she is opening for her 23-year- old son, Jacques. It is near the Church of the Nativity, revered by Christians as the birthplace of Jesus Christ.

Bethlehem is mostly surrounded by the snaking separation wall Israel has built between it and the West Bank, a nine- meter-high cement and wire-fence barrier that Palestinians say has confiscated much of the residents’ land, separating farmers from fields and disrupting travel. Israel says the wall is necessary to prevent terrorist attacks on its towns and cities.

“Palestine is a challenging tourism destination,” the 45- year-old Daibes told reporters, noting that much of the tourism increase over the past year comes from Russia, eastern Europe and India. “We tell visitors that Bethlehem is surrounded by a wall, but if you cross it, you will have a unique experience.”

To contact the reporters on this story: Gwen Ackerman in Jerusalem at gackerman@bloomberg.net.

To contact the editors responsible for this story: Peter Hirschberg at phirschberg@bloomberg.net.

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.