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Arab League Boycott: U.S. Tries to Prevent Renewal of Boycott

(October 2002)

In response to Arab League efforts to reactivate and expand the economic boycott of Israel, the Bush Administration has taken steps to prevent American companies and individuals from participating in the embargo.

At an October 29, 2002, meeting, of the Arab League’s Israel Boycott Office, 18 Arab states, including state sponsors of terrorism Iraq, Syria and Libya, pledged to “reactivate the Arab boycott of Israel and combat the importation of Israeli products to Arab countries.” The aim of such a move would be to further cripple an Israeli economy already ailing from more than two years of Palestinian terrorism.

Participants at the Arab League meeting also compiled a secret list of 15 companies that they would blackball for having business ties to Israelis. Four Arab League nations skipped the meeting, including Egypt and Jordan, two countries that have signed peace treaties with Israel, as well as Mauritania, which maintains diplomatic relations with Israel, and Somalia.

In response to the Arab League’s boycott, Undersecretary of Commerce Bureau of Industry and Security Kenneth I. Juster released a statement one week later warning Americans not to cooperate with the boycott. “[The] U.S. Government is strongly opposed to restrictive trade practices or boycotts targeted at Israel,” Juster said, adding that the government would “use all of its resources to vigorously enforce U.S. anti-boycott regulations.” Juster also noted that such government policy could have implications regarding the effort by anti-Israel activists to pressure universities to divest from Israel. “It has been our concern to ensure that in no way is such activity occurring in response to efforts by various foreign governments to boycott Israel,” he said.

Under U.S. law, any American company or individual who boycotts Israel in coordination with the Arab League is subject to criminal prosecution. Penalties for American companies or persons who follow the Arab League’s lead include fines of up to $50,000, or five times the value of the exports involved and 10 years imprisonment for each violation. While these provisions recently expired along with the Export Administration Act, President Bush has signed an executive under which these rules are enforced, and the administration is reportedly pursuing stiffer penalties for violators in a future version of the bill.

The Arab League has a long history of blacklisting both Israeli and third-country corporations that have contacts with Israelis. Since 1951, more than 8,500 companies and persons have been targeted because they refused to participate in a campaign to isolate Israel economically. Just one week after the Arab League’s statement, it placed at least two ships on its boycott list for contacts with Israel.

Sources: Near East Report (December 16, 2002)