Technology’s Role in the Middle East: Building Bridges in Bytes

by Conner Maher on August 1, 2013


“Walls don’t work,” declared former Admiral James Stavridis, incoming Dean of The Fletcher School of Law & Diplomacy, in a 2012 TED talk about the future of global security. “We cannot create security with walls. We have to build bridges.” Israel and Palestine have yet to translate this vision into reality, but technology increasingly has the potential to be one of those bridges. With a firmly entrenched technology sector in Israel and a growing Information and Communications Technology (ICT) industry in the West Bank, linking both sectors could not only be beneficial financially, but also offer an avenue for peaceful cooperation.

Since 2010, the West Bank—an area sharply divided by distinct administrative divisions—has been home to a nascent, but bourgeoning tech industry. Much of the region’s promising success derives from investments by Intel, TouchStar, and Cisco in 2008. These capital investments have helped spur economic growth, but more importantly have allowed Palestinian ICT companies to gain international credibility and respect. The ICT industry now accounts for a growing portion of the Palestinian economy: In 2011, the 250 ICT firms (which include telecommunications) in the West Bank were responsible for 6.1 percent of Palestine’s GDP, a more than seven-fold increase since 2008. With much of the private sector development in Palestine restricted, technology and Internet-based businesses remain largely untapped but prepared to grow. The founding of Sadara Ventures in Ramallah to back Palestinian technology start-ups will help fuel the expanding Palestinian ICT sector even more.

Even with this much-needed infusion of investment and credibility, the Palestinian economy is still precarious and reliant on external assistance. Twenty-three percent of the Palestinian population is unemployed, including twenty percent of the West Bank and thirty-one percent of Gaza. The lagging skills-based job market cannot keep pace with the approximately 1,500 to 2,200 computer programmers and engineers that graduate annually from Palestinian universities. Ramallah, the de facto capital of the West Bank, has doubled in size over the last ten years but is in the midst of an unsustainable construction boom. Additionally, the Palestinian Authority employs over twenty-two percent of the population with public sector jobs and salaries that are largely supplemented by foreign aid.

Yet abutting the West Bank is Israel, considered by some to be  a quasi-“Silicon Valley” and home to a slew of successful start-ups such as Waze, Inc., recently purchased for $1.1 billion by Google. Although Israel’s technology sector is firmly established, it could still reap benefits from partnering with West Bank firms, including by supplementing its demand for skilled employees by hiring qualified Palestinian employees. Murad Tahboub, founder of ASAL Technologies, describes the technology industry as reliable and a sector that “does not depend on physical goods and is resilient to political turmoil.” Wherever there is a telephone line and electricity, a Palestinian with a computer can work. Additionally, the two neighbors share the same time zone and weekend, allowing for seamless business operations. They also understand each other’s cultures, local customs, habits, and taboos. Most importantly, investing in Palestine’s ICT sector will make the Palestinian economy more durable and could pave the way for better Israeli-Palestinian relations.

Examples of partnerships between Israeli-owned and Palestinian-owned companies are rare but have the potential to be vehicles of peace and cooperation. For example, in 2008, Israeli CEO Zvi Schreiber founded, an early version of cloud computing, with the desire to combine a “business interest with my ambition to do something for peace and to help create jobs for Palestinians.” At the time, Mr. Schreiber was restricted from visiting his Ramallah office, but routine Skype video calls allowed for regular dialogue and communication. During the 2009 conflict between Hamas and Israel, even though Mr. Schreiber admitted there was office “tension,” ultimately “We remain[ed] focused on our product.” This example lends credibility to economic bridges continuing cooperation when conflicts intensify, even if only through business operations. Ultimately, when a conflict declines, these established relationships will be the first bridges between differing societies.

While these could be valuable intermediate steps towards forging more sustainable partnerships between the two sectors, the future remains uncertain. With an unprecedented six trips over the past four months, U.S. Secretary of State John Kerry has prioritized reviving the dormant negotiations between Israeli and Palestinian leaders, resulting in a recent announcement that talks have resumed. Prisoner releasesland exchanges, and private investment will all likely be offered as carrots during the negotiations. The latter should be emphasized over the other two, as economic linkages are the most promising bridges to peace. Indeed, the evidence to date suggests that high-speed internet could be the start of transmitting more than just data.

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