THE STATE OF PALESTINENATIONAL EXPORT STRATEGYFRESH FRUITS, VEGETABLES AND HERBSSECTOR EXPORT STRATEGY 2014-2018

This publication has been produced with the assistance of the European
Union. The contents of this publication can in no way be taken to reflect theviews of the European Union.

The National Export Strategy of the State of Palestine was developed on
the basis of the process, methodology and technical assistance of theInternational Trade Centre (ITC). The views expressed herein do not reflect
the official opinion of the ITC. This document has not formally been editedby the ITC.

Photo next page : Paltrade
Layout : Jesús Alés ( sputnix.es )The International Trade Centre ( ITC ) is the joint agencyof the World Trade Organization and the United Nations
Street address:

ITC 54-56, rue de Montbrillant 1202 Geneva, Switzerland

Postal address:

ITC Palais des Nations 1211 Geneva 10, Switzerland

Telephone:+41-22 730 0111

Fax:

+41-22 733 4439

E-mail:itcreg@intracen.org

Internet:

http://www.intracen.org

Ministry of National Economy ( MONE )Address :Ramallah – Im Al-Sharayet

Tel :+ 970 2 2981218

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Email :

info@met.gov.ps

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P.O. Box :883 | Ramallah | PalestineTel :+ 970 2 240 8383

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Email :

info@paltrade.org

THE STATE OF PALESTINENATIONAL EXPORT STRATEGYFRESH FRUITS, VEGETABLES & HERBSSECTOR EX PORT STR ATEGY • 2014-2018

Source: PalTradeINTERNATIONAL TRADE CENTRE

ACKNOWLEDGEMENTS
The Fresh Fruits, Vegetables & Herbs strategy of the National Export Strategyof the State of Palestine was made possible with the support of the Trade
Diversification and Competitiveness Enhancement Project of the European Union( EU ), the sponsorship of the Palestinian Ministry of National Economy, and thecommitted leadership of PalTrade.
This document represents the ambitions of the private and public stakeholders
who dedicated long hours to define the enhancements and future orientations
for the sector to increase its export performance and growth (full list of stakeholders in Appendix 1).
Guidance and support were provided to the project by the following key personnel.

Sector Strategy Team : Majeda Salameh
Ministry of National
Economy Ramiz Obaied
Ministry of Agriculture E. Abeed
Ministry of Labour Ahmad Eid
Ministry of Agriculture Yazan Odeh
PARC Hasanein Hasanein
PARC Yousef Salah
General Directorate
of Extension & Rural
Development
 Suha Arar
Ministry of Health Ibrahim Atiya
Ministry of Health Moayyad Al Housani
Fedex
 Harbi Daraghmeh
Al Jeflek Cooperative Khaled Dawod
PARC Emad Al Banna
Banna
 Ala Masoud
ARIJ
 Said Janan
Mount of Green Olives
 Saleh Ahmad
UAWC
 Adnan Jaber
Sinokrot Tareq Abu Khaizaran
Agripal Younes Yameen
Team Coordinator Ayman Mousa
PARC
 Sameer Aljunaidy
Aljunaidy Co.
 Shadi Darwesh
Ministry of Agriculture Yousef Abo Awwad
Siniora Food Co.
 Mohammad Alamsri
Ministry of Agriculture Tareq Abu Laban
Ministry of Agriculture Mohammad Abu
Khaizran
Zadona Hosam Al Zorba
Pal Gardens
 Bassam Waleel
Golden Wheat Mills
Company Mustafa Barakat
Ministry of Agriculture Bassam Al Nimer
 Sanad Sabri
Pal Gardens
 Bakr Bsharat
 Saber Amleh
Ministry of National
Economy Ahmad Showakah
PPU ( Palestine
Polytechnic University ) Hussien Ahmad
PFIA Ramzi Abu Khaizaran
Al Khaizaran Co.
 Majdi Daraghmeh
Al Khaizaran Co.
 Mohammed Al Sayyed
PSI Manal Dsui
Ministry of National
Economy Munther Orekat
Ministry of National
Economy Saleh Fareed
Ministry of Labour

Ministry of National Economy ( MoNE ) : Manal Farhan
NES Navigator Nahid Qudsi
Assistant Navigator
PalTrade and Ministry of National Economy ( MoNE ) : Hanan Taha
Chief Executive Officer
 Shawqi Makhtoub
Trade Policy Manager
 Samir MareeNES Specialist
 Mohammed Al Ram’ah
NES Coordinator Mayada Diab
Program CoordinatorInternational Trade Centre : Anton J. Said
Chief, Export Strategy
 Darius Kurek
Project Manager
 Charles Roberge
Lead technical Advisor Rahul Bhatnagar
Lead Author
 Younes Yameen
Team Coordinator in Palestine

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CONTENTSACKNOWLEDGEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III

EXECUTIVE SUMMARY 	1
INTRODUCTION 	5
HISTORICAL OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  5

WHERE ARE WE NOW? 	7
CURRENT CONTEXT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  7
SOCIOECONOMIC CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  9
PRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  9

VALUE CHAIN OPERATIONS 	13FRESH FRUITS AND VEGETABLES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  13HERBS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  14CURRENT VALUE CHAIN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  15IMPORTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  16GLOBAL MARKETS – A SNAPSHOT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  18PALESTINE’S EXPORT PERFORMANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  20COMPETITION IN TARGET MARKETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  24THE INSTITUTIONAL PERSPECTIVE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  25SECTOR DEVELOPMENT INITIATIVES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  30EXPORT COMPETITIVENESS ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  32

WHERE WE WANT TO GO : 	41OPTIONS FOR FUTURE DEVELOPMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  41MARKET AND STRATEGIC OPTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  41FUTURE VALUE CHAIN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  42MARKETS IDENTIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  43

INTERNATIONAL TRADE CENTRE

HOW WE GET THERE 	53STRATEGIC OBJECTIVES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  53IMPORTANCE OF COORDINATED IMPLEMENTATION . . . . . . . . . . . . . . . . . .  53IMPLEMENTATION PARTNERS – LEADING AND SUPPORTING INSTITUTIONS53

PLAN OF ACTION 	55ANNEX 1 : SECTOR TEAM MEMBERS 	67BIBLIOGRAPHY 	68

LIST OF FIGURES

Figure 1 : Palestinian fruit, vegetable, and herb production 1999 / 2000
to 2010 / 2011 ( US $  ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Figure 2 : Agricultural workers chart. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Figure 3 : Trends in FFVH production 1999 / 2000 to 2010 / 2011 . . . . . . . . . . . . . . . . . . . . . . 10
Figure 4 : Trends in Palestinian herb production 1999 / 2000 to 2010 / 2011 . . . . . . . . . . . . 12
Figure 5 : State of Palestine percentage distribution of the value of plant
production requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Figure 6 : Palestinian imports for the fresh fruits and vegetables sector 2000 to 2010. 16
Figure 7 : Destinations for Palestinian herbs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
Figure 8 : Export survival rate – FFVH sector. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

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TABLES

Table 1 : Impact of the second intifada on fruit, vegetable, and herb production
1999 / 2000 to 2005 / 2006. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Table 2 : Plant production 2007 / 2008. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Table 3 : Palestinian vegetable crops 2007 / 2008 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Table 4 : Palestinian fruit production 2007 / 2008. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Table 5 : Total herbs production in the State of Palestine 2012. . . . . . . . . . . . . . . . . . . . . . 12
Table 6 : Palestinian fruit and vegetable imports 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
Table 7 : Leading global importers of fresh fruits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Table 8 : Leading global importers of fresh fruits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Table 9 : Leading global importers of fresh vegetables. . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
Table 10 : Major global exporters of fresh vegetables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Table 11 : Major Palestinian exports in the fresh fruits sector 2007-2010. . . . . . . . . . . . . 21
Table 12 : Major Palestinian exports in the fruits and vegetables sector. . . . . . . . . . . . . 22
Table 13 : Palestinian herb exports with a certificate of origin. . . . . . . . . . . . . . . . . . . . . . 23
Table 14 : Palestinian policy support network. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Table 15 : Palestinian trade services network. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Table 16 : Palestinian business services network. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Table 17 : Palestinian civil society network . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Table 18 : FFVH stakeholders’ perception of TSIs’ level of influence and capacity . . . 29
Table 19 : Development activities in the FFVH sector. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Source:Michael.Loadenthal.

Source: © PalTrade

EXECUTIVE SUMMARYEXECUTIVE SUMMARY
Agricultural activity is a cornerstone of Palestinian culture
and society, and plays an integral role since its establishment in the region 8,000 years ago. The sector’s contribution to the national GDP ( 5.5 % ) understates, to an extent,
the dynamism of this sector in terms of providing socioeconomic contributions to the population. Key attributesof the sector include the following: Approximately 1,207,061 dunum of agricultural landin 2009 / 2010, of which 1,029,280 dunums are cultivated ( representing 30 % of total land, and 85.3 % of
agricultural land ).
 Estimated 305,250 workers in the agricultural sector,
although 73.3 % of them are family members who
are not directly compensated. Approximately 13 %of Palestinian workers are employed in this sector
and it is responsible for almost one third of women’s
employment.
 The value of plant production in 2007 / 2008, the lastyear for which reliable data is available, was calculated
to be 832 million US$, comprising 61 % of total agricultural production. Of this, vegetables were responsiblefor 462.2 million US $ ( 55 % of plant production ) andfruit trees were responsible for 264 million US $ ( 32 % ).
Roughly 649 million US $ of value was added throughplant production, of which 71 % was added in the WestBank.

CURRENT CONTEXT
Based on Ministry of Agriculture estimates, the fresh fruits,
vegetable and herbs sector achieved growth of 9.3 % in2010 / 2011, driven mainly by the 12 % annual increase inland dedicated to vegetable production. Further growth
was generated through the herbs subsector, with production rising by 13 % and 12 % in 2009 / 2010 and 2010 / 2011
respectively. Fruit production, meanwhile, has been declining at a rate of about 4 % per year due in part to thedecreased activity in Gaza.
These estimates place the total value of FFVH production
at US$ 871 million in 2010 / 2011, of which US$ 128 million
is fruits, US$ 696 million is vegetables, and US$ 47 million
is herbs. From 1999 / 2000, the entire sector has grown anestimated 56 % ( fruits –60 %, vegetables +214 %, herbs+201 % ).

EXPORTS PERFORMANCE
Palestine is a small player in the global fresh fruits market with a global share of less than 1 % ; however, sector
exports have exhibited impressive growth in recent years
despite starting from a low base. Palestinian exports inthe fruits sector totaled US$ 7.7 million in 2010. A comparison of 2007 and 2010 absolute values reveals thatexport growth has outperformed global import growthtrends. Palestinian fresh fruit exports have grown at a rateof 52 %, compared to global import growth of 21 % overthe same time period.
The main fruit exports from the State of Palestine are nuts,
dates, grapes, strawberries and almonds. The bulk ofexport growth for the sector has been driven by a rise inexports of dates. Palestinian exports of dates have risen
from US$ 324,000 in 2007 to US$ 1.2 million in 2010, reflecting an absolute growth of over 250 %.
In contrast to the fresh fruits sector, the fresh vegetables
sector has suffered a downturn in recent years. While
global imports grew by 25 % between 2007 and 2010
( in terms of absolute values ), Palestinian fresh vegetables exports suffered a decline of 34 %. Exports of fresh
vegetables totalled US$ 6.8 million in 2010. The main exported products in the sector are miscellaneous vegetables / vegetable mixtures, olives, cucumbers, chickpeas,
and tomatoes, among others.
Similarly to the fruits sector, the primary destinations of exports in this sector are Israel and selected other markets
such as the United Arab Emirates and the Netherlands,
with Jordan and Algeria constituting the minority. The only
product for which market diversification has taken placeis olives, with an approximately 50 / 50 split between Israel
and the United Arab Emirates.
The herbs subsector in the State of Palestine possesses
significant export potential that is being increasingly harnessed and realized through dedicated efforts by individual farmers, cooperatives and medium-size enterprises.
The increasing value and success of Palestinian herbs ininternational markets is highlighted by the fact that the volume of fresh herb exports from the West Bank increasedby nearly 250 % between 2009 and 2012.
As discussed earlier, the sector production structureis characterized by export-dedicated plantations using
greenhouses and open fields. It is estimated that almost
1,200 dunums of land have been set up specifically for1

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THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

exports. The vast majority of products in the herbs subsector – including the aforementioned dedicated plantations – are destined for export, primarily to Israel, theUnited States, Jordan, Russia and Europe.
The export performance of the FFVH sector has beenhampered by a number of issues such as a shortage offertilizers, restrictions on access to fertile land in Area C,lack of quality control on agricultural inputs, limited irrigation water, lack of international accreditation for food testing laboratories in the State of Palestine results in reduced
target market confidence, weak cold chain infrastructure“leads to high wastage volumes during transit, the trade information available to the sector suffers from poor content
and accessibility challenges and poor sector organization is hindering export promotion and branding efforts.

OPTIONS FOR FUTURE
DEVELOPMENT
In order to develop the export potential of the Palestinian
FFVH sector, the following vision has been developed towards the goal of increasing the export competitiveness.

”

To get high quality, competitive, Palestinian branded fresh
produce accessing global markets.

To reach this vision, the sector strategy will reduce thetrade competitiveness barriers identified as well as capitalized on strategic options. The strategic orientations
for the next five years is to capitalize on developing key
markets in the short and medium for Palestinian exporters, and facilitate structural changes in the value chain to
increase its efficiency and value generation for Palestine.
The market identification was based on a combination of
trade analysis and consultations with the enterprises of
the FFVH sector. In the short term, cultural affinity, bilateral geographical distances, and existing trade relationships will form the major criteria determining the markets
for Palestinian FFVH products. In the longer term, it isexpected that the evolving capacities of Palestinian exporters – across multiple dimensions including quality
management, supply capacities, product diversification,
time to market efficiency, and marketing/branding, in conjunction with the improving business environment andexport value chain improvements affected by the NES
and sector PoA implementations – will allow exporters totarget other markets in the medium to long term which
seem hard to penetrate now.
The short term market development of the FFVH sector
will focus on selected products in such target destinations as Israel, Turkey, Italy, United Arab Emirates, The
Netherlands, Germany, Sweden and Norway. In the medium term, the strategy will enable exporters to expand
their export reach through the provision of new products
to selected target markets such as the United Kingdom,
Jordan and the United States.
The expected structural changes to the sector are basedon efficiency gains identified through the four gear
analysis of the sector’s performance, and through theidentification of opportunities for improving the sector’scapacity to add, create, retain and distribute value. The
key changes to the value chain include, the develop technical competencies towards the niche organic market
segment, develop a new product line of natural oils extracted from Palestinian herbs, improve the inclusion ofyouth throughout the sector’s value chain, increase theinvolvement of women workers and develop agri-tourism
initiatives.

ROADMAP FOR SECTOREXPORT DEVELOPMENT
The sector strategy vision will be achieved through theimplementation of the strategic plan of action ( PoA )for the sector. This PoA is made up of of four strategic
objectives:
 Enhance the supply and quality management capacities of FFVH producers to better respond to global
target market requirements.
 Strengthen the business, legislative and regulatory
framework supporting the FFVH sector.
 Increase the sector’s coordination and organization toincrease its ability to operate in a challenging global
environment.
 Increase the sector’s capacity and ability to enter andsustain export relationships in current and emerging
markets.
As detailed in the PoA of the strategy, these strategic
objectives are structured around a specific set of activities intended to address the wide-range of issues andopportunities of the FFVH sector.

EXECUTIVE SUMMARY

A number of institutions will play a key role in the implementation of the plan of action for the FFVH sector.
These are institutions that have the overall responsibility
for successful execution of the strategy, as well as support institutions that are active partners but not leading
institutions. Each institution mandated to support the export development of the FFVH sector is clearly identified
in the strategy plan of action.
The broad range of activities, together with the complex
nature of integrated intervention, requires careful implementation that efficiently directs resources and monitors
results at both the micro and macro levels. To this end, a
Palestinian Export Council (PEC ) will be established in order to facilitate the public-private partnership in elaborating, coordinating, and implementing the National Export
Strategy. In particular, the PEC will be tasked with coordinating the implementation of activities in order to optimize
the allocation of both resources and efforts across thewide spectrum of stakeholders. Within this framework,
implementation of the trade logistics and facilitation strategy also falls within the purview of the PEC.

TARGET MEASURESThe key targets of the strategy as defined by the sector
exporters are to : Increase by 3 percent the share of total FFVH exports
to Israel to capitalise on existing export relationships
and distribution channels to international markets.
 Increase by 20 % export to the United States becauseof better pests’ controls in order for FFVH products tocomply with SPS standards of this important market.
 Increase by 30 % exports to the European Union because of better performance of exporting companies
to apply best agricultural practices such as global GaP,HACCP, and IPM.
 Diversify exports to ten new markets because of increased capacity and quality of exports as well as thesigning of new trade and mutual recognition agreements. For selected new destination markets, it is anticipated that total new exports to the United Kingdom
will be worth US$ 14,000,000, new exports to the UAE
will equal more than US$ 16,000,000, and new exports
to the Netherlands will at the end of the strategy implementation process be worth US$ 25,000,000.
The FFVH sector strategy holds significant promise interms of contributing to the exports performance of thecountry, while also driving improvements across the sector’s value chain. The achievement of these ambitious targets will require continuous and coordinated efforts fromall key stakeholders from the private and public sectors aswell as support from key financial and technical partners.

Box 1 : Methodological note

The approach used by ITC in the strategy design process relies on a number of analyticalelements such as value chain analysis, trade support network ( TSN ) analysis, problem tree,
and strategic options selection, all of which form major building blocks of this sector export
strategy document.

Value chain analysis
A comprehensive analysis of the sector’s value chain is an integral part of the strategy development process. This analysis results in the identification of all players, processes and linkages
within the sector. The process served as the basis for analysing the current performance of thevalue chain and for deliberating on options for the future development of the sector.
The analysis charts the main stages involved in the sector’s export process, from ‘inputs sourcing’ to ‘distribution in market segments’. This is followed by the identification of key stakeholders
who include not just the primary players ( e.g. producers, processors, distributors etc. ) but also
those fulfilling support functions with direct linkages to the primary players. These support services include input providers ( seed suppliers, equipment suppliers etc. ), transportation service
providers, packaging houses, and financial service providers, among others.

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THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Box 1 : Methodological note (cont.)
TSN analysis
The trade support network comprises the support services available to the primary value chain
players discussed above. It is constituted of policy institutions, trade support organisations,business services providers and civil society. An analysis of the quality of service delivery andconstraints affecting the constituent trade support institutions ( TSIs ) is an important input tohighlight gaps in service delivery relative to specific sector needs. A second analysis of TSIs
assessed their level of influence ( i.e. their ability to influence public policy and other development drivers in the country and therefore make things happen or change ) and their level ofcapacity to respond to the sector’s needs.

Problem tree analysis
The problem tree analysis used is based on the principles of root cause analysis and the Pareto
principle. The reason for using the problem tree exercise is to gain a deeper understandingof what is causing the high level constraints, and where solution-seeking activities should bedirected. This exercise involves a two-step process: First, the value chain analysis, surveys and consultations with key public and private stakeholders identify constraints affecting sector-specific export value chains. These constraints
are abstract and a more thorough breakdown is required to identify the specific root causesof constraints. Multiple levels of root causes are identified for each high-level constraint.
 Second, the problem tree uses the Pareto principle to identify critical root causes in the
problem tree. This is especially important for resource limitations that usually exist during
the strategy implementation phase. Therefore focus is needed on the 20 % of the root causes
which result in 80 % of constraints affecting the sector. Critical paths through the problem tree
are charted to discover the most significant root causes constraining the sector.
These steps resulted in a comprehensive problem tree detailing the constraints affecting thesector’s export value chain, along with characterisations related to the types, granularity andintensity of the root causes. The problem tree then guides the design of the solution-seeking
phase of the strategy.

Defining where we want to go
The strategic options for the development of the sector are reflected in the future value chain,
which is the result of consultations, surveys and analysis conducted as part of the sector strategy design process. The future perspective has two components:
 A market-related component involving identification of key markets in the short and mediumto-long term for Palestinian exporters, and ; Structural changes to the value chain that result in either strengthening of linkages, or introduction of new linkages.
Both components are integral parts of the future value chain, which is the basis of the strategic
action plan developed for the sector.

INTRODUCTIONINTRODUCTION

Source: © Fadi Arouri – Jericho & Jordan Valley

HISTORICAL OVERVIEW
The fresh fruits, vegetables and herbs ( FFVH ) analysis
and strategy presented in this document forms an integral part of the National Export Strategy of the Stateof Palestine. Apart from its significant contributions toeconomic stability and growth, the agriculture sector
has played an important role in defining and preserving national identity. The export development of the sector has mainly been oriented towards export to Israel for
consumption or for re-export. A few products are now
reaching new target markets in the Arab region and theEuropean Union. The sector’s future export development
is currently limited owing to a variety of challenges ranging from provision of inputs and ownership structure of
productions facilities. This document presents the expectations of the private and public sectors for the improvement of the fresh fruits, vegetables and herbs sector in theState of Palestine. Without concerted efforts to addresscritical issues and identified market development opportunities the sector’s potential will remain untapped insteadof leveraging its important potential and capacity. The
five year plan of action of the strategy proposes realistic
and achievable activities that will contribute to making
FFVH a leading export sector, creating Palestinian produce of quality and variety to meet growing global needs.

Agricultural activity is a cornerstone of Palestinian culture and society, having played an integral role in theregion since its establishment 8,000 years ago. The sector’s contribution to the national GDP ( 5.5 % ) downplays
its dynamism in providing vibrant employment for men,
women, and youth.
Apart from significant contributions to economic stability
and growth, agriculture has played an important role indefining and preserving national identity. Throughout thetwentieth century it was a symbol of Palestinian resilience,
while at the same time acting as a source of income andfood security during periods of conflict and crisis.
Nonetheless, persistent conflict has continued to takea toll on agricultural commerce. Political and security
stress came to a head in the second intifada, and theconflict had immense implications for sector productivity. Both the physical destruction, as well as the creationof the separation barriers and Area C, which limited access to large swathes of arable land, led to a marked
decline in agricultural output. As shown in the graphbelow, sector production declined dramatically through2005. Immediately following the onset of the conflict,from 1999 / 2000 to 2000 / 2001, the production of fruits,
vegetables, and herbs declined by 50 %, 7 % and 9 % respectively. It is important to note that fruit production has
never fully recovered, and in 2010 / 2011 it was estimatedto be 60 % lower than pre-conflict levels. The majority ofthe sector’s growth (in value) has been achieved in recent
year by fresh herbs.

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THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Figure 1 : Palestinian fruit, vegetable, and herb production 1999 / 2000 to 2010 / 2011 ( US $  )

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00
/2
00

20

99

/2

00

0

1.000.000.000
900.000.000
800.000.000
700.000.000
600.000.000
500.000.000
400.000.000
300.000.000
200.000.000
100.000.000
0

19

6

Source : PCBS, Agricultural Statistics & Ministry of Agriculture Estimates.

Table 1 : Impact of the second intifada on fruit, vegetable, and herb production 1999 / 2000 to 2005 / 2006
Year

Value of fruit
trees ( US $  )

Value ofvegetables( US $  )

Value of herbs( US $  )

Total% Change
fruit ( from1999 / 2000 )% Change
vegetables( from1999 / 2000 )% Change
herbs ( from1999 / 2000 )% Change
total ( from1999 / 2000 )1999 / 2000

319 884 000

221 555 031

15 579 669

557 018 700

–

–

–

–

2000 / 2001

159 236 000

205 827 478

2001 / 2002

200 725 000

218 030 781

14 162 582

379 226 060

-50 %

-7 %

-9 %

-32 %

15 382 579

434 138 360

-37 %

-2 %

-1 %

-22 %

2002 / 2003

163 142 000

229 179 628

15 943 552

408 265 180

-49 %

3%

2%

-27 %

2003 / 2004

213 654 000

2004 / 2005

168 915 000

238 271 253

16 701 207

468 626 460

-33 %

8%

7%

-16 %

239 579 455

16 719 965

425 214 420

-47 %

8%

7%

-24 %

2005 / 2006

205 828 000

295 102 839

20 459 961

521 390 800

-36 %

33 %

31 %

-6 %

Source : PCBS, Agricultural Statistics.

Although the end of the second intifada saw a return tosector growth, more recent conflicts have continued toadversely affect production. Following Israeli aggression
during the so called Operation Cast Lead in 2009 1, 46 %of agricultural lands in Gaza were deemed to be inaccessible or useless because of destruction realized in thecourse of the conflict, blockades, and the presence of
security buffer zones. Meanwhile, the expansion of Israeli
settlement and the separation barrier have diminishedaccess to resources in the West Bank, as a large portionof fertile agricultural land falls within occupied territories
or has been confiscated for construction.

1. Israeli military operation in the Gaza strip aimed at ending rocket
attacks and stopping weapons smuggling. December 27, 2008 to
January 18, 2009.

Source: © Fadi Arouri - Jericho & Jordan ValleyWHERE ARE WE NOW

WHERE ARE WE NOW?
CURRENT CONTEXT
The Palestinian territory contained approximately
1,207,061 dunums 2 of agricultural land in 2009 / 2010,of which 1,029,280 dunums are cultivated ( representing
30 % of total land, and 85.3 % of agricultural land ).3

machinery. Moreover, 64.9 % of plant and mixed holdings use organic fertilisers, 34.8% use chemical fertilisers,
49.7 % use pesticides, 25.1 % used improved agricultural
assets, and only 18.4% use integrated pest management.

The amount of cultivated land devoted to growing vegetables is 127,257 dunums. Of this, 100,579 dunums arelocated in the West Bank, while 26,678 are in Gaza. The
area dedicated to horticultural crops is much larger at542,363 dunums of cultivated land, with 501,818 dunums
in the West Bank and the remaining 40,545 in Gaza.

These holders obtain varying degrees of productivity, aresupported by various cooperative systems, and tend touse methods based on traditional practices.4 The products of small farmers are mainly destined for household
consumption, the local market, or at times the Israeli markets, and their goods tend to be of relatively low and inconsistent quality. Distribution channels are fragmented
and the domestic market is comprised of retail shops,
stalls and wholesale markets. A few larger enterprises,
meanwhile, have invested in the necessary infrastructure
to support export activity, although market penetration
has thus far been slow. This fragmented production anddistribution structure leads to important challenges insupply consistency.

As indicated above, the vast majority of cultivated land
( 90.8 % ) is found in the West Bank. The regions with thelargest cultivation areas were Jenin ( 19.4 % of cultivatedland ), Hebron ( 16.5 % ) and Nablus ( 12.9 % ), while Gaza
( 1.1 % ) and North Gaza ( 1.3 % ) had the smallest aggregate holdings. In total only 14 % of cultivated land is fed
by irrigation, although this figure is significantly higher in
Gaza ( 72 % ) than in the West Bank ( 8.7 % ).
The Palestinian agricultural sector is dominated by smallholdings and individual farmers, and the average size ofa holding is 10.84 dunums. Census data indicates that
there were 111,310 agricultural holdings in 2010, of which
over 80 % were located in the West Bank.
Of the total enterprises in 2010, 46 % worked less than
three dunums of land, 21 % between 3 and 5.99 dunums, and 12.1 % between 6 and 9.99 dunums. Almost
74 % ( 73.8 % ) of enterprises are managed by the holder,24.1 % by household members, and only 1.9 % by hired
managers.
Ownership structures vary as well, and although thevast majority of holdings are the property of the holder( 85.5 % ), approximately 4.1 % are rented or sharecropped.
It should be noted that although women are well represented in the sector they comprise only 6.8 % of holders.

Processing and packaging is controlled by a few large
operators characterized by an underutilization of capacity. The Sinokrot Group, for example, which specializes
in herb and vegetable exports, operates at around 33 %capacity 5. It should be noted, however, that small-scale
processing and packaging does occur at the local level.
A further distinction should be made with regards to theherbs subsector, in which production varies greatly depending on the final destination of the goods. Those destined for export are produced by specialized large andmedium-sized farms, while those for the local market are
produced mainly by smallholders who have had difficultyentering export markets due to low quality and production capacities.

Enterprises use a variety of technical and chemical aids
to production, and the PCBS estimates that 60,053 (54 % )agricultural holdings made use of at least one piece of
2. 1,000 square metres.
3. Palestinian Central Bureau of Statistics ( 2010 ). Agricultural

Census. Ministry of Agriculture ( 2010 ). Agriculture Sector Strategy :“A Shared Vision” 2011-2013, p. VIII.

4. DAI Europe - Technoserve ( 2011 ). A Roadmap for Agribusiness

Development in the Occupied Palestinian Territories : An Analysis of
the Vegetables & Herbs, Dairy, and Sheep & Goats Subsectors.
5. Sinokrot Global Group ( 2013 ). Interviews with Zadona and Pal
Gardens staff.

7

8

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Box 2 : The State of Palestine’s five agro-ecological zones
According to location, rainfall and altitude, five agroecological zones can be distinguished in the Palestinian
Territories. They include the Coastal Zone ( the Gaza Strip ), the Semi-Coastal Zone, the Central Highlands,
the Eastern Slopes, and the Jordan Valley.

The Coastal Zone ( Gaza Strip )This zone is located along the eastern coastal plain of the Mediterranean Sea. The Sinai Desert surrounds
this zone from the south. It has a semi-arid Mediterranean climate of long, hot summers and mild winterswith fluctuating rainfall. Rainfall is relatively moderate in the north, reaching 300 mm or more, but is below
200 mm in the south.

The Semi-Coastal Zone
This is a narrow strip comprising parts of the Jenin and Tulkarm districts with altitudes of 100-300 metresabove sea level and it has an average annual rainfall of 600 mm. Most of the soils are medium textured, of
alluvial origin, and consist of silt and loam derived from a variety of parent materials. Less than half of thecultivated area depends on rain only. More than half is irrigated or receives some supplementary irrigationwater. The rain-fed crops are cereals and grain legumes. However, fruit trees are also grown under rain-fed
conditions. Irrigated crops include a wide variety of vegetables, potatoes, citrus and other irrigated fruit trees.

The Central Highlands Zone
This zone includes the highland area starting from Jenin in the north to Hebron in the south. The zone ismountainous, rising up to 1,000 metres above sea level. It is mostly hilly and rocky, and soils are often shallow. Average annual rainfall is about 400 mm. Of the total cultivated area, 95 % is rain fed. The remaining 5 %of cultivated land is irrigated and is used mainly for producing vegetables. The rain-fed land is about 60 %fruit trees and 35 % field crops. The main fruit trees are olive, grape, and almond. The main field crops are
winter cereals and grain legumes.

The Eastern Slopes Zone
This is a transitional zone between the central highland and the desert areas of the Jordan Valley. It extends
from the eastern parts of Jenin to the Dead Sea in the south. Little rainfall in this region make it an almost
semi-arid to desert zone. Agricultural production is of marginal importance and is limited to rain-fed cereals
such as wheat and barley. Olives are cultivated as well. Average annual rainfall ranges between 250 and 300
mm. The total area of this zone is approximately 1,500,000 dunums, with altitudes varying from 800 metresabove sea level in the north to 200 metres below sea level in the south.

The Jordan Valley Zone
This is a narrow strip between the Eastern Slopes and the Jordan River. It is 70 km long and drops to about
400 metres below sea level near the Dead Sea. Rainfall is low ( 100-200 mm ) and winters are mild whilesummers are hot. Soils are sandy and calcareous. This zone is the most important irrigated area in the WestBank. The availability of both springs and ground water makes this area most suitable for off-season vegetables and for semi-tropical tree plantations including banana and citrus. All strains and varieties of datepalm trees are still in existence. Orchards of citrus fruits with special tastes and an early ripening season are
remarkable in the Jordan Valley. Recently, early grape strains began to be used as an economical cash crop.
Source : Palestine Economic Policy Research Institute ( MAS ) ( 2011 ). The Comparative Advantage of Selected Cropsin the West Bank Using the Policy Analysis Matrix Approach ( PAM ).

WHERE ARE WE NOW

Figure 2 : Agricultural workers chart

50,00%
38,20%

35,10%

40,00%

24,30%

30,00%
20,00%
10,00%
0,00%

2,40%
Permanent (Paid)

Permanent (Unpaid)

Temporary (Paid)

Temporary (Unpaid)

Source : Palestinian Central Bureau of Statistics ( 2010 ). Agricultural Census.

SOCIOECONOMIC
CONTRIBUTIONS
The agricultural sector is an important source of employment, especially among women, and it contributes significantly to socioeconomic development. Moreover, theproduction of local foodstuffs plays an important role inmitigating food insecurity, and fruits and vegetables arevital inputs for further processing.
There are estimated to be 305,250 workers in the agricultural sector, although 73.3 % of them are family members who are not directly compensated 6. The average
wage for work in the sector was $11.71 per day in 2011 7.
Work is seasonal and the majority of paid labour ( as opposed to unpaid ) is casual work 8. Approximately 13 %of Palestinian workers are employed in this sector and it
is responsible for almost one third of women’s employment 9. The following graph breaks down sector employment by type of position :the trends of the sector, employment in the vegetable
subsector is estimated to be growing by 12 % per year
and the herbs subsector by 7 %, while employment in the
fruits subsector it is declining by 4 % annually.

PRODUCTIONFRUITS AND VEGETABLES
The value of plant production in 2007 / 2008, the last year
for which reliable data is available, was calculated to be
832 million US $ , comprising 61 % of total agricultural production 11. Of this, vegetables were responsible for 462.2
million US $ ( 55 % of plant production ) and fruit trees were
responsible for 264 million US $ ( 32 % ). Roughly 649 million US $ of value was added through plant production,of which 71 % was added in the West Bank.
The following table illustrates the production of the various crop types by geographic area.

It is estimated that 88,523 workers are directly employedin the FFV and Herbs sectors, with 32,971 employed in
fruit production ; 51,358 employed in vegetable production ; and 4,194 employed in herb production 10. In line with
6. Palestinian Central Bureau of Statistics ( 2010 ). Agricultural

Census. Using PCBS midyear population estimates, 58 % of the
population ( of 4,048,403 ) is above the age of 15, of which 13 %were employed in the sector.
7. Palestinian Central Bureau of Statistics ( 2011 )8. Palestinian Central Bureau of Statistics ( 2010 )9. Ministry of Agriculture, ( 2010 ) ; DAI Europe -Technoserve ( 2011 )10. Estimates of the Ministry of Agriculture

11. Palestine Economic Policy Research Institute ( MAS ) ( 2011 ) ;the most recent data calculates that agriculture contributed 5 %(  $360 million ) to GDP in 2010.

9

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Table 2 : Plant production 2007 / 2008
Palestinian Territory

Crop types

Area

West Bank

Production

Value

Area

Gaza Strip

Production

Value

Area

Production

Value

Field Crops

495.4

185.4

105.7

441.2

112.9

70.7

54.2

72.5

35.1

Vegetables

186.2

696.5

462.2

139.9

481.3

322.5

46.2

215.3

139.7

Fruit Trees

1 172.4

254.3

264

1 112.6

200.3

213.5

59.8

53.9

50.5

Total

1 854.0

1 136.30

831.9

1 693.7

794.6

606.6

160.2

341.7

225.3

Source : Palestine Economic Policy Research Institute ( MAS ) ( 2011 ). The Comparative Advantage of Selected Crops in the WestBank Using the Policy Analysis Matrix Approach )Note : Area : dunum, Production : metric ton, Value : 1,000 US $ ( Palestine Economic Policy Research Institute ( 2011 ) ).

Figure 3 : Trends in FFVH production 1999 / 2000 to 2010 / 2011

1.000.000.000
800.000.000
600.000.000
400.000.000
200.000.000

1

20

10

/2

01
20

09

/2

/2
08

Value of Herbs($)

01

0

9
00

8
20

07

/2

00

7
20

06

/2

00

6

Value of Vegetables($)

20

/2

00

5
05
20

04

/2

00

4
20

03

/2

00

3
20

02

/2

00

2

Value of Fruit Trees($)

20

20

01

/2

00

1
00
/2
00

20

99

/2

00

0

0

19

10

Total

Source : Ministry of Agriculture estimates

Based on Ministry of Agriculture estimates, the FFVH
sector achieved growth of 9.3 % in 2010 / 2011, driven
mainly by the 12 % annual increase in land dedicatedto vegetable production. Further growth was generated
by herbs, whose production grew by 13 % and 12 % in2009 / 2010 and 2010 / 2011 respectively. Fruit production,
meanwhile, has been declining at a rate of about 4 %per year due in part to the decreased activity in Gaza.
These estimates place the total value of FFVH production
at US $ 871 million in 2010 / 2011, of which US $ 128 million
is fruits, US $ 696 million is vegetables, and US $ 47 million
is herbs. From 1999 / 2000, the entire sector has grownan estimated 56 % ( fruits –60 %, vegetables +214 %,herbs +201 % ).

The aggregate plant sector relies upon over 112 plantvarieties, including 38 types of vegetables and 39 typesof fruit. The vegetable subsector is concentrated in Jenin
and Tulkarm, which together are responsible for over 32 %of vegetable production. The 2007 / 2008 agricultural season yielded nearly 690,000 metric tons by leveraging
roughly 186,000 dunums of land. The most importantvegetable crops are cucumber ( 30.2 % of vegetable production ), tomato ( 30.1 % ), eggplant ( 9 % ), squash ( 7 % ),paprika ( 2 % ), and green bean ( 1 % ). Table 3 illustrates thepercentage of vegetable production, the percentage ofland devoted to vegetables, the percentage of this land
located in the West Bank, and the main areas of activity
for these vegetables.

WHERE ARE WE NOWTable 3 : Palestinian vegetable crops 2007 / 2008
% of veg. land

% of areain West Bank

30.2 %

17.0 %

82 %Tulkarm, Jenin, Gaza Strip, Jericho, Tubas

30.1 %

13.0 %

57 %Jericho, Tubas, Gaza Strip, Jenin, Qalqilia,
Hebron, Ramallah, Albireh

Eggplant

9.0 %

6.0 %

82 %

Jericho, Gaza Strip, Jenin, Tubas

Squash7.0 %15.0 %

77 %Jericho, Tubas, Gaza Strip

Paprika

2.0 %

2.0 %

96 %

Jericho, Jenin, Tulkarm

Green Bean

1.0 %

2.0 %

79 %

Jericho, Gaza Strip, Tulkarm

Vegetable
CucumberTomato% of veg.
production

Geographic concentration

Source : Palestine Economic Policy Research Institute ( MAS ) ( 2011 ).
The Comparative Advantage of Selected Crops in the West Bank Using the Policy Analysis Matrix Approach ( PAM ).

Table 4 : Palestinian fruit production 2007 / 2008
% of fruit
production% of fruit
tree land% of areain West Bank

Geographic concentration

Olive

34.0 %

81.0 %

97 %Nablus, Jenin, Ramallah, Albireh, Tulkarm, Hebron

Grape

22.0 %

6.0 %

95 %

Hebron, Bethlehem, Gaza Strip

Fig

3.0 %

1.0 %

96 %

Nablus, Hebron, Ramallah, Albireh

Orange

2.5 %

0.3 %

n.a.

Gaza Strip, Qalqilia, Tulkarm

Banana

2.0 %

0.1 %

n.a.

Jericho, Al-Ghors

Palm tree

1.6 %

0.7 %

46 %

Gaza Strip, Jericho

1.5 %

2.5 %

91 %

Tulkarm, Nablus, Jenin, Ramallah, Albireh,
Hebron, Gaza Strip

0.5 %

1.0 %

n.a.

Gaza Strip

Fruit

Dried Almond
Strawberry

Source : Palestine Economic Policy Research Institute ( MAS ) ( 2011 ).
The Comparative Advantage of Selected Crops in the West Bank Using the Policy Analysis Matrix Approach ( PAM ).

The fruit subsector yielded nearly 1.9 million tons offruit on a production area of over 1.1 million dunums
in 2007 / 2008. The two most important regions for fruit
production are Hebron ( 24.3 % of domestic production )and Nablus ( 13.5 % ) and the main fruits grown are olives( 34 % of fruit production ), grapes ( 22 % ), figs ( 3 % ), oranges ( 2.5 % ), bananas ( 2 % ), palms ( 1.6 % ), and driedalmonds ( 1.5 % ) and strawberries ( 0.5 % ). Table 4 illustrates the percentage of fruit production, the percentageof land devoted to fruit trees, the percentage of this land
located in the West Bank, and the main areas of activity
for these fruits.

HERBS
Seventeen varieties of herbs are cultivated in the Stateof Palestine, mostly focused on fresh exports. The main
products in the herb subsector are arugula, basil, chervil,
chives, coriander, dill, marjoram, mint, oregano, parsley,rosemary, sage, sorrel, tarragon, and thyme.
An important feature of the herbs subsector is the lengthof its harvest calendar. The agronomic and climate conditions in Palestine, as well as the diversity of herb types
that can be grown, result in the potential to harvest significant quantities of herbs throughout the year. This isespecially important from the perspective of developing
a comparative advantage in international markets.
The production base comprises 30 fresh herbs producers.
It is estimated that eight of these companies solely cater tothe export market. The subsector is also characterized bya number of qualified and well-equipped packing houses,
including two GLOBALGAP certified packing houses.

11THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

12

Table 5 : Total herbs production in the State of Palestine 2012
Product

Productivity – Dunum / year

1

Chives3000 kg2

Mint

6000kg3

Arugula3600kg4

Rosemary

2600kg5

Parsley

8000kg

6

Coriander

2200kg7

Chervil

2200kg

8Dill

1500kgBasil ( including Red Basil )1800kg11

Tarragon

3000kg

12Sage

5000kg13

Thyme

4000kg

14

Oregano3500kg15

Marjoram

4200kg16

Sorrel

3000kg

9 + 10Source : Data compiled through bilateral meetings

Figure 4 : Trends in Palestinian herb production 1999 / 2000 to 2010 / 2011

250,0%

50.000.000
45.000.000
40.000.000
35.000.000
30.000.000
25.000.000
20.000.000
15.000.000
10.000.000
5.000.0000200,0%
150,0%
100,0%
50,0%
0,0%

1
/2

01

0
10
20

/2

01

9
09
20

/2

00

8
08
20

07

/2

00

7

20

20

/2

00

6

Production (USD)

06

/2

00

5
20

05

/2

00

4
04
20

/2

00

3
20

03

/2

00

2
02
20

/2

00

1
01

/2

00
20

00
20

19

99

/2

00

0

-50,0%

Cumulative Growth

Source : Ministry of Agriculture estimates

As noted in Figure 4, production values have exhibited
growth of over 200 % over the last decade, reaching
US $ 46.9 million in 2010 / 2011.

A prominent characteristic of the herbs subsector is the export-dedicated plantations (greenhouses and open fields)that have been set up. It is estimated that almost 1,200
dunums of land have been set up specifically for exports.

VALUE CHAIN OPERATIONSVALUE CHAIN OPERATIONSFRESH FRUITSAND VEGETABLES

PRE-PRODUCTION
AND INPUT SOURCINGThe fresh fruits and vegetables value chain in the State ofPalestine revolves around a number of steps that include
the provision of preliminary services including sourcing
of inputs, cultivation, protection, harvesting, post-harvest
processing, packaging, sales, distribution, and exportdelivery. Although these stages may differ according to
the specific product or target market, the basic production pattern is fairly stable.

The first step of the value chain is pre-production. In thisstage land is prepared and crop rotations planned. It ishere that the necessary financial and agricultural inputs
are acquired by producers. The key actors at this stage
are suppliers and the producers who commission theirservices. A number of service providers including financial institutions, agronomists, land workers, equipment
and machinery operators, and input providers, are essential at this stage.
The main production inputs include seeds, fertilizers,
pesticides, water, electricity, fuel, and farm equipment.
Figure 5 shows the relative importance of each input in
total production requirements.

Figure 5 : State of Palestine percentage distribution of the value of plant production requirements

maintenance & repair2%

others
12%

seeds
16%

oil, lubrication & fuel
7%
mulch
2%

fertilizers
26%

water & electricity
15%

pesticides
20%
Source : PCBS, 2009. Agricultural Statistics, 2007 / 2008.

13

14

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Source: © PalTrade

Input supply is often of low quality and expensive as there
is a heavy reliance on imports for nearly all inputs.

PRODUCTION
The production stage includes planting, pest management, fertilization, and harvesting of crops. It may also
involve the acquisition of financial services, and technical guidance from extension services. Production is performed by three types of producers : individual farmers,
cooperatives and agribusinesses. A number of third party providers, including agronomists, day labourers andtechnical consultants, are relied upon for their services.
Enterprises face a variety of input-related difficulties atthis stage due to the complex trade environment and thelimited quality management infrastructure.

POST-HARVEST
Post-harvest involves the sorting, washing, grading,packaging, storing, loading, and transporting of goods.
At this stage, production is mainly handled by local collectors and packing houses. External support is provided
by storage and transport companies, packaging suppliers, and testing laboratories ( national or foreign ).

DISTRIBUTION TO MARKET
Distribution and sales of FFVH occur for both domestic
and export markets. For domestic consumption, produce
is channelled to wholesalers to end up in the local retail market. Various service providers such as wholesalecommissioners, packing houses, and storage / transportation providers are relied upon at this stage. It should be

noted that some farmers may sell their products directly
to retail outlets, thereby bypassing more organized market mechanisms. For exports, once the goods have been
packed and tested they are transported in refrigerated
trucks to their point of exit.

HERBS
Although the herbs subsector follows similar processes,
the subsector’s value chain exhibits specific characteristics. Growers fall into three categories : small-scale, medium-scale, and large-scale. These producers rely upona number of inputs for their production and although thebasic inputs such as water and land are locally available,
the majority of other inputs are imported. These include
phytosanitary inputs such as fertilizers, equipment, andseeds, all of which are subject to the same import andquality constraints detailed for the fresh fruits and vegetables sector. They may arrive in the State of Palestineeither directly or through domestic suppliers, Palestinian
distributors / importers, or Israeli distributors.
Harvested goods are transported to Palestinian packaging houses, where they are prepared for transport andsale. Goods at this stage may also be subject to laboratory testing and certification, although weak regulatory
standards and infrastructure limit foreign sales potential. Following this step, the products are passed to both
Palestinian distributors and exporters. While domestic
distributors will forward the products to retail markets,
exporters may either export directly to target markets or
make use of Israeli middlemen.
The current value chain of the FFVH sector is defined infigure 6 below :Agrochemicals(Herbicides,
Fungicides,
Pesticides)

Labor office

Machinery
and tools

Seeds,
seeding

Fertilizers

Utilities, water, land,
electricity, fuelInputs usedby farmers

National component

LegendPalestinian
Packaging
HousesStorage

Post harvest / packaging
houses

Logistics, Storage, Refrigerated transportation

Inputs supplier (seeds, instruments,
technics, fertilizers, etc.)

Berzait University

Transportation services

Agricultural development Association (PARC)

Technical and maintenance services

Banks – Financial services

Loboatories – Quality testing

Accounting services

MGT Consultants, Wholesale commissioner,
Business supporting agencies, Municipalities

Distribution

Land Preparers

Primary Supporting Services

Production by farmer’s
cooperatives

Production, post-harvestingand packaging by agro-companies

Production and post-harvest
by farmer’s cooperatives

Production and post-harvest
by individual farmers

Processing Companies (dried, frozen,
preserved, juices and fruits)

Manufacturer suppliers

Fresh Fruits – Vegetables
and herbs from Gaza Strip

Fresh herbs for export

Farms: fresh fruits and vegetables
for fresh consuption+export

Farms: fresh fruits and vegetables
for processed foodInternational component

CURRENT VALUE CHAIN

Local market –Gaza Strip

Exports

Local market

Agro-based
Industries

Institutions

HouseholdComsumption

Local consumers

Importingcompanies

US

Importingcompanies

Netherlands

Importingcompanies

EU / UK

Distributors

Gulf

Distributors

RussiaRe-export

JordanRetailtrade

WholesaletraderRetailRetailSupermarket

Retail shops

Supermarket

Traders

Retailcustomers

Gulf

EU

Retailnetwork

Distributors** Fresh herbs for export are more than 17 varieties:
thyme, chives, chevil, arugula, sage, mint, parsley, flat
parsley, lemon thyme, tarragon, savore, coriander, lemonbalm, basil, red basil, dill, marjoram, rosemary, oregano.

* Main vegetables exported to the Israeli market:
tomato, cucumber, squash, kidney beans, broad beans,pumpkins, cauliflower, cabbage, potato, eggplvant,okra, lemon, orange, corn, fennel, turnip, onion, garlic,grapes, hot pepper, bell peppers, guava.

Dates
Fresh Herbs

Strawberries**Vegetables

Dates**
Vegetables

Bell pepper,**
tomato,Dates

Capsicum,Cherry tomatoes**

Capsicum,
fresh vegetables
and**Tomatoes,cuncumber,pumkins
cauliflower,squash, eggplant,
Herbs
*
**

IsraelVALUE CHAIN OPERATIONS
15

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBSIMPORTS
Imports in the FFVH sector primarily consist of production inputs for the sector, and imports of fresh fruits andvegetables by Palestinian retailers for consumption in local markets.

IMPORTS OF PRODUCTION INPUTS
There is a heavy reliance on imports for nearly all inputsof the sector and most inputs, such as fertilizers, agrochemicals and utilities, come through an Israeli supplieror intermediary. This is because of a combination of two
factors – a weak domestic supply base for these inputs
and the import restrictions put in place for chemicals
and other dual use items essential for the agricultural
sector.
Water is another essential production input for which demand significantly outweighs supply. Producers face major difficulties in accessing water for irrigation purposes

thanks to a combination of restrictions on accessing water resources, inefficient management of water resources,
and rapid population growth in the State of Palestine.

IMPORTS OF FRESH FRUITSAND VEGETABLES
In theory, vegetable production in the State of Palestine
is sufficient for satisfying domestic demand. In practice,
however, approximately 25% of the vegetables consumed
in the State of Palestine are imported – mainly from Israel.
The fruits subsector also exhibits a similar trend ofhigh imports.
Figure 6 concurs with the above assessment. As indicated, while exports have been gradually increasing in
the recent past, imports are rising much faster and haveamounted to 3-4 times the export levels in recent years.
As a result, the sector suffers from a large trade deficit.

Figure 6 : Palestinian imports for the fresh fruits and vegetables sector 2000 to 2010

Exports & Imports (Fresh fruits, vegetables and herbs sector)
PSE
20

10

US Dollars, Millions

16

0

-10

-20

-30
2000

2005

2010

Year
Exports

Imports

Trade Balance

Source : ITC calculations based on COMTRADE SITC Revision 3 data.
Note : The figure includes imports of herbs, which are, however, minimal thanks to the year round harvestand supply capacity of the herbs subsector.

VALUE CHAIN OPERATIONS

Source: © PalTrade

The following constitute some of the important factors
contributing to this trade deficit : In the case of fruits, the harvest cycle in the State ofPalestine is short and the sector suffers from weak
supply capacity except for varieties such as grape thatare available in ample supply. Due to the resulting supply gap, the domestic market becomes dependenton imports. This is especially true in the case of citrus
fruits, which are produced and available in the State ofPalestine between November and February. Supply gaps
in the remaining months are mainly covered throughimports from Israel and, to a lesser extent, Jordan.
 Imports in the vegetables subsector are mainly a resultof market dynamics between the Palestinian and Israeli
markets. The main driver is price. Palestinian retailers typically buy high volumes of vegetables from theIsraeli wholesale markets on weekends, when Israeli

wholesalers are seeking to offload lower shelf life products at lower prices than those available to retailers
in the Palestinian markets. This dumping results in asignificant disadvantage for Palestinian producers,
who cannot compete with low Israeli prices beyonda certain point.
 Seasonality also plays an important role for vegetables. For instance, Palestinian potato produce ismainly available between January and August. During
the gap months, supply is maintained through Israeli
products. Even when Palestinian produce is available,
pricing policies of suppliers renders Palestinian produce uncompetitive.
Table 6 confirms the trends identified above. Apart froma few instances of imports from suppliers in Turkey andCanada, the majority of imports in the State of Palestine
are sourced for Israel.

Table 6 : Palestinian fruit and vegetable imports 2010
HS codeDescription

Imports in 2010
US $ 1 000

Main suppliers‘080810

Apples, fresh

16 136Israel ( 16 136 )‘080300

Bananas including plantains, fresh or dried

11 359Israel ( 11 359 )‘080290

Nuts, edible, fresh or dried, whether or not shelled or peeled,n.e.s.

5 975

Israel ( 4 520 )Turkey ( 908 )‘081090

Fruits, fresh, n.e.s.

4 922

Israel ( 4 922 )‘080450

Guavas, mangoes and mangosteens, fresh or dried

4 481

Israel ( 4 481 )‘070700

Cucumbers and gherkins, fresh or chilled

3 417

Israel ( 3 417 )‘080440

Avocados, fresh or dried

3 232

Israel ( 3 232 )‘071320

Chickpeas, dried, shelled, whether or not skinned or split

2 804

Israel ( 2 797 )‘071340

Lentils dried, shelled, whether or not skinned or split

2 642

Turkey ( 1 436 )Canada ( 810 )‘080930Peaches, including nectarines, fresh

2 367

Israel ( 2 367 )‘080820Pears and quinces, fresh

2 315

Israel ( 2 315 )Source : ITC calculations based on UN COMTRADE statistics.

17

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

18

GLOBAL MARKETS– A SNAPSHOTFRESH FRUITSGLOBAL IMPORT TRENDS FOR FRESH FRUITSThe global market size for edible fruits, nuts, and peel of
citrus fruits and melons ( HS08 ) 12 stood at US $ 94 billion
in 2011, reflecting an annual growth rate of 7 % between
2007 and 2011. Led by the United States and Germany,
western markets constitute the main importing markets
for these products.
Russia has exhibited a strong growth rate of 13% between
2007 and 2011 – almost double the global growth averageduring the same time. With the exception of the UnitedStates and Russia, the other growth leaders among
the top five importers are underperforming vis-à-vis theglobal average.
Source: © PalTrade

GLOBAL EXPORT TRENDSFOR FRESH FRUITSThe US and Spain are the leading global exporters offresh fruits. The United States commands almost 14 % of
global markets, outperforming the global growth averagethrough an exhibited annual growth rate of 12 % between
2007 and 2011.

12. Hereafter referred to as fresh fruits

Spain is the second largest exporter with a 9 % global
market share. According to official 2012 forecasts, it isanticipated that Spain’s exports will continue to grow at
between 5 % and 7 % and a value increase of 10 %.
This confirms that Spain’s export performance will remain strong even within a strong economic downturn
environment13.
13. Fresh Plaza

Table 7 : Leading global importers of fresh fruits
Value imported in2011 ( US $ thousand )Annual growthin value between
2007 and 2011 ( % )Annual growthin value between
2010 and 2011 ( % )Share of world
imports ( % )World

94 284 205

7

14

100

1

United States

10 917 900

7

9

11.6

2

Germany

9 077 157

4

10

9.6

3

Russian Federation

6 216 079

13

13

6.6

4

United Kingdom

5 428 750

-1

11

5.8

5

Netherlands

5 401 121

5

20

5.7

Rank

Importers

Source : ITC calculations based on UN COMTRADE statistics.

19

VALUE CHAIN OPERATIONS

Table 8 : Leading global importers of fresh fruits
Rank

Value exported
in 2011( US $ thousand )Exporters

Annual growthin value between
2007 and 2011 ( % )Annual growthin value between
2010 and 2011 ( % )Share of world
exports ( % )World

86 490 585

8

16

100

1

United States

11 765 634

12

16

13.6

2

Spain

8 051 353

4

12

9.3

3

Chile

4 916 856

9

16

5.7

4

Netherlands

4 660 658

6

23

5.4

5

Italy

3 987 361

0

6

4.6

Annual growthin value between
2007 and 2011 ( % )Annual growthin value between
2010 and 2011 ( % )Source : ITC calculations based on UN COMTRADE statistics.

Table 9 : Leading global importers of fresh vegetables
Rank

Importers

Value imported
in 2011( US $ thousand )Share of world
imports ( % )World

62 463 578

7

9

100

1

United States

7 779 780

8

11

12.5

2

Germany

6 445 814

6

-3

10.3

3

United Kingdom

4 006 564

-3

4

6.4

4

France3 133 703

0

0

5

5

Russian Federation

3 046 885

20

34

4.9

Source : ITC calculations based on UN COMTRADE statistics.

FRESH VEGETABLESGLOBAL IMPORT TRENDSFOR FRESH VEGETABLESGLOBAL EXPORT TRENDSFOR FRESH VEGETABLES

The global market for fresh vegetables14 amounted to
US $ 62 billion in 2011, reflecting year on year growth of
7 % ( similar to the growth rate for fresh fruits ) between
2007 and 2011. As is the case for fresh fruits, the UnitedStates and Germany are top consumers among global
markets for fresh vegetables.

The top five global exporters of fresh vegetables are
China, the Netherlands, Spain, Mexico, and the UnitedStates. China and the Netherlands are the top global exporters of fresh vegetables, jointly commanding 26 % of
the global market.

The Russian market outperformed the global growth average by a large margin - almost three times in the caseof fresh vegetables. While the United Kingdom of GreatBritain and Northern Ireland is still a leading consumerof fresh vegetables, it has exhibited a negative growthtrend in recent years.

14. HS 07, Edible vegetables and certain roots and tubers

China in particular is expected to maintain its lead at leastin the short-to-medium term, given that it has outperformed global average rates by almost three times overthe period of 2007-2011. In the period 2007-2011, Spanish
exports underperformed significantly in relation to theirpeers and the global average.

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

20

Table 10 : Major global exporters of fresh vegetables
Rank

Exporters

Value exported
in 2011( US $ thousand )Annual growthin value between
2007 and 2011 ( % )Annual growthin value between
2010 and 2011 ( % )Share of world
exports ( % )World

61 796 317

8

11

100

1

China

8 722 974

23

17

14.1

2

Netherlands

7 461 511

4

10

12.1

3

Spain

5 731 459

2

8

9.3

4

Mexico4 944 866

8

14

8

5

United States

3 941 868

6

4

6.4

Source : ITC calculations based on UN COMTRADE statistics.

PALESTINE’S EXPORTPERFORMANCEFRESH FRUITSPalestinian exports in the fruits sector totaled US $ 7.7
million in 2010. The State of Palestine is a small player in the global fresh fruits market with a global shareof less than 1 % ; however, sector exports have exhibited
impressive growth in recent years despite starting froma low base. A comparison of 2007 and 2010 absolutevalues15 reveals that export growth has outperformed
global import growth trends. As indicated below in table
15. 2010 data is used for comparison, given the non-availability of

reliable 2011 data for Palestine.

Source: © Fadi Arouri - Jericho & Jordan Valley

10, Palestinian fresh fruit exports have grown at a rate of
52 %, compared to global import growth of 21 % over thesame time period.
The main fruit exports from the State of Palestine are nuts,
dates, grapes, strawberries and almonds. The bulk ofexport growth for the sector has been driven by a rise inexports of dates. Palestinian exports of dates have risen
from US $ 324,000 in 2007 to US $ 1.2 million in 2010, reflecting an absolute growth of over 250 %.
Exports are mainly concentrated on the Israeli market, followed by the United Kingdom, Italy and the United ArabEmirates, although consumption of Palestinian fruit products in these markets is still much lower than in Israel.

21

VALUE CHAIN OPERATIONS

Table 11 : Major Palestinian exports in the fresh fruits sector 2007-2010

HS 4
08
HS 6

Product label
All Palestinian fresh fruits exports

Exportedvalue 2010
( 000 )

Palestinian exports( % annual growth byvalue – absolute values )World imports( % annual growth byvalue – absolute values )( 2007-2010 )( 2007-2010 )

52

21

7 690

Product label

Exported value in 2010 Main target markets‘080290

Nuts, edible, fresh or dried, whether or not shelled or
peeled, n.e.s.

1 968 Israel ( 1 460 )‘080410

Dates, fresh or dried

1 194 Israel ( 253 )United Arab Emirates( 174 )

‘081010Strawberries, fresh

1 028 United Kingdom ( 420 )Netherlands ( 206 )‘080610

Grapes, fresh

830 Israel ( 830 )‘080212

Almonds, fresh or dried, shelled or peeled

688 Israel ( 688 )‘080211

Almonds in shell, fresh or dried

601 Israel ( 449 )Italy ( 113 )‘080121

Brazil nuts, in shell, fresh or dried

337 Israel ( 337 )‘080231

Walnuts in shell, fresh or dried

285 Israel ( 285 )‘080232

Walnuts, fresh or dried, shelled or peeled

164 Israel ( 164 )Source : ITC Calculations based on COMTRADE statistics ** ( 2008-2010 ) data

FRESH VEGETABLES
In contrast to the fresh fruits sector, the fresh vegetables
sector has suffered a downturn in recent years. While
global imports grew by 25 % between 2007 and 2010
( in terms of absolute values ), Palestinian fresh vegetables exports suffered a decline of 34 %. Exports of fresh
vegetables totalled US $ 7.69 million in 2010. The main
exported products in the sector are miscellaneous vegetables/vegetable mixtures, olives, cucumbers, chickpeas,
and tomatoes, among others identified in the table below.
Similarly to the fruits sector, the primary destinations of exports in this sector are Israel and selected other markets
such as the United Arab Emirates and the Netherlands,
with Jordan and Algeria constituting the minority. The only
product for which market diversification has taken placeis olives, with an approximately 50 / 50 split between Israel
and the United Arab Emirates.

Source: © PalTrade

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

22

Table 12 : Major Palestinian exports in the fruits and vegetables sector

HS 4

07

Exported value
2010 ( 000 )Product label% Growth by valueof Palestinian
exports( absolute values )% Annual growthby value of world
imports( absolute values )( 2007-2010 )( 2007-2010 )

6 831

-34

25.2

Exported value in2010

Main target markets

All Palestinian vegetables

Code

Product label‘071190

Other vegetables ; mixtures of vegetables

1 545

Israel ( 1 544 )‘071120

Olives1 452

United ArabEmirates ( 456 )Israel ( 407 )‘071320

Chickpeas, dried, shelled, whether or notskinned or split

684

Israel ( 684 )‘070700

Cucumbers and gherkins, fresh or chilled

656

Israel ( 656 )‘070200

Tomatoes, fresh or chilled

515

Netherlands ( 243 )‘071340

Lentils dried, shelled, whether or notskinned or split

424

Israel ( 424 )‘070310

Onions and shallots, fresh or chilled352

Jordan ( 340 )‘071390

Leguminous vegetables dried, shelled,
whether or not skinned or split, n.e.s.

338

Israel ( 338 )‘071333

Kidney beans & white pea beans

233

Israel ( 233 )‘070960

Peppers of the genus Capsicum or of thegenus Pimenta ,fresh or chilled

199

Algeria ( 122 )Source : ITC Calculations based on COMTRADE statistics ** ( 2008-2010 ) data

HERBS
The herbs subsector in the State of Palestine possesses
significant export potential that is being increasingly harnessed and realized through dedicated efforts by individual farmers, cooperatives and medium-size enterprises.
The increasing value and success of Palestinian herbs ininternational markets is highlighted by the fact that the volume of fresh herb exports from the West Bank increasedby nearly 250 % between 2009 and 2012.
As discussed earlier, the sector production structureis characterized by export-dedicated plantations using
greenhouses and open fields. It is estimated that almost
1,200 dunums of land have been set up specifically forexports. The vast majority of products in the herbs subsector – including the aforementioned dedicated plantations – are destined for export, primarily to Israel, theUnited States, Jordan, Russia and Europe.

Table 13 shows the main export destinations ( excluding
Israel) of the herbs subsector, listed according to the herbvariety 16. The United States constitutes the main market
for Palestinian herbs and absorbs 83 % of Palestinian exports. Approximately 7 % of Palestinian herb exports areabsorbed by other Arab countries, and 5 % by the EU andRussia respectively.
Figure 7 builds on table 13 and indicates the importanceof the American market to Palestinian herb exporters.

16. The figures include Palestinian exports to Israel that areaccompanied by a certificate of origin. Exports to Israel that are
not accompanied by a certificate of origin are not included.

VALUE CHAIN OPERATIONS

Table 13 : Palestinian herb exports with a certificate of origin
Product

Current market

ArugulaUnited States, EU

Exports %
11

Basil

United States, EU, Russia

10

Chervil

United States, EU, Russia

9

ChivesUnited States, EU

8

Coriander

United Kingdom

8

Dill

United Kingdom

8

Marjoram

United States

8

Mint

United States, EU, Russia, Arab

7

OreganoUnited Kingdom

6

Rosemary

United States, EU, Russia

5Parsley

United Kingdom, United States, Russia

5

Tarragon

United States, EU, Russia

4

Sage

United States, EU, Russia

4

SorrelUnited States, Russia

4

Thyme

United States, EU

3

Source : Data compiled through bilateral meetings

Figure 7 : Destinations for Palestinian herbs

Destination for Palestinian herbs

1.800.000.000
1.600.000.000
1.400.000.000
1.200.000.000
1.000.000.000
800.000.000
600.000.000
400.000.000
200.000.000

Source : data compiled through bilateral meetings

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23

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBSCOMPETITION IN TARGET
MARKETSThe following indicates some of the key competition elements faced by the FFVH sector in target markets : For both fresh fruits and vegetables subsectors, theexport basket is relatively diversified but the export
destinations remain fairly concentrated. The main
destination for both subsectors remains Israel, andPalestinian exporters have been largely unable to penetrate international markets.
 A high percentage of Palestinian herb exports to Israel
are re-exported under an Israeli brand name to western and other important target markets. The majorityof Palestinian exporters do not provide a certificate
of origin. The Israeli re-exports typically command ahigher price, with value-added packaging and better brand promotion. Palestinian exporters face significant financial challenges in terms of shipping to
distant target markets such as the United States, while

Israeli exporters are less affected by this challenge. Bymanaging supply consistency of quality herb products( originally supplied by Palestinian exporters ), Israeli
exporters are able to command high margins and develop a significant competitive advantage. This represents a major opportunity for Palestinian exporters tolink directly with target markets.
 As discussed in the current context section, the herbs
subsector possesses significant comparative advantages through its wide harvest calendar which allows
the sector to supply high quality herbs almost throughout the year. This can serve as an important competitive advantage in international markets.
As indicated in figure 8, export relationships in the
FFVH sector are suffering from an average probabilityof survival over time. The greatest risk is during the firstyear of operation, at the end of which the probabilityof the export relationship surviving drops by 41 %. By
the third year, the probability of survival drops to lower
than 30 %.

Figure 8 : Export survival rate – FFVH sector

Export Relationships (Fresh fruits, vegetables and herbs sector)
Survival Rate 2002-11

1

8

Probability of Survival

24

6

4

2

0
0

5

Year

Source : ITC calculations based on COMTRADE SITC Revision 3 data

10

VALUE CHAIN OPERATIONS

Many factors can explain the challenging survival rates of
FFVH export relationships. The four gear section of thisdocument provides key information for understanding
the challenges to the export performance of the sector.

THE INSTITUTIONALPERSPECTIVE
The trade support institutions ( TSIs ) providing important
services to the Palestinian FFVH sector can be categorized according to the following support areas :Tables 14-17 identify the main TSIs whose service delivery impacts the quality management framework in theState of Palestine. An assessment of the TSIs along four
key dimensions – coordination, human capital, financial
sustainability, and advocacy – is provided. The ranking( high / medium / low ) for each TSI was selected taking
into account the service delivery of the TSI relative to the
Quality Management function. In other words, the assessment was conducted based the evaluation of stakeholders in TSIs from the perspective of how well they serve
the FFVH stakeholders.

POLICY SUPPORT NETWORK Policy support network
 Trade services network
 Business services network
 Civil society network

The institutions in the policy support network represent
ministries and competent authorities responsible for influencing or implementing policies at the national level.

Table 14 : Palestinian policy support network
Policy support

Name
Function / role
Coordination 17
			HR / human
Financial
Advocacy
20
capital 18 sustainability 19

Ministry of
National
Economy( MoNE )The Ministry of National Economy is responsible in the FFVH sector for :• Standards and regulation enforcement• Duty draw back payments• Release of financial guarantees• Industrial licences• Renewal of industrial operating licences• Verification of names• Certification of a Certificate of Origin• Re-exporting transactions• Certified Exporter certificates

M

L

L

L

Ministry ofAgriculture( MoA )

Implementation of state policy on agricultural and rural development supports
the planning, development, and organization of the whole value chain of plant
and animal products ; supports postharvest handling of agricultural products ; and the food industry.

M

L

L

L

17. Coordination with other TSIs : measures the strength of this institution’s linkages with other institutions as well as the beneficiaries of theirservices ( in particular, the private sector ) in terms of collaboration and information sharing.
18. HR / Human Capital Assessment : assesses the general level of capability of this institution’s staff in terms of their training, and responsivenessto the sector stakeholders.
19. Financial Resources Assessment : Assesses the financial resources / capacity available to the institution to provide service delivery in an efficientmanner.
20. Advocacy : The efficacy of this institution’s advocacy mechanisms, and how well / frequently this institution disseminates important information to
the sector.

25

26

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Policy support
Name

Function / role

Coordination

HR / humancapitalFinancialsustainability

Advocacy

Ministryof Higher
Education( MoHE )MoHE has overall responsibility for supervising the education system in theState of Palestine, including schools,
colleges and universities. It is also responsible for overseeing TechnicalVocational Education Training ( TVET ),which includes vocational schools, vocational-technical training centres( VTCs ), and technical colleges.

L

L

L

L

Ministry of
Health ( MoH )The MoH has the mandate to ensure
good governance of the health sector ;leadership in policy making for and regulation of the health system ; the promotion of better health ; and the provisionof accessible, quality health services
in both the public and private sectors.
For the export sector, MoH maintains
quality standards for food and issues
Certificates of Health.

M

M

L

L

Ministry ofLabour ( MoL )MoL manages the formulation and administration of labour laws and legislation, managing and monitoring thelabour market. It also support the development and organization of cooperatives.

M

M

L

L

Ministry of
Finance ( MoF )The MoF is responsible for the collection and administration of customs duties, as well as following up on customs
revenues from Israel to the Palestiniantreasury and dealing with daily problems facing importers and exporters.

L

M

L

L

Ministry of
Women Affairs( MoWA )The MoWA is responsible for gendermainstreaming, the empowerment of
women, and alleviation of the severe living conditions of Palestinian women.

L

L

L

L

Source: © Fadi Arouri - Jericho & Jordan Valley

VALUE CHAIN OPERATIONSTRADE SERVICES NETWORK
These institutions or agencies provide a wide rangeof trade related services to both government andenterprises.
Table 15 : Palestinian trade services network
Trade services network
Name

Function / role

Coordination

HR / humancapitalFinancialsustainability

Advocacy

PalTrade

PalTrade is the trade promotion organizationof the State of Palestine with the mandate todevelop exports. PalTrade’s mission for the
FFVH sector is improving trade competitiveness through trade promotion and capacity building ; fostering international businesspractices and standards among professionals, firms and business organizations ; andproviding trade-enabling knowledge.

H

L

M

M

PalestineStandards
Institution ( PSI )PSI is considered the sole body responsible for issuing Palestinian standards : by providing accreditation for labs, granting thequality mark for products, and signing cooperation and mutual recognition agreementswith other countries to facilitate trade.

M

L

L

L

PalestinianCentral Bureau of
Statistics ( PCBS )The responsibility of PCBS for the FFVH sector is :• To serve the instrumental needs of businesses and their organizations for statistical information on states and trends.
• To participate effectively in building thedifferent administrative records and central registers to meet the administrativeand statistical needs of the Palestinian society.
• To publish a statistical yearbook annually.

M

L

L

L

Agricultural
Development
Association( PARC )The Agricultural Development Association( PARC ) is a leading Palestinian non-profit, non-governmental organization involvedin rural development and women’s empowerment. PARC provides advice, awarenesssupport, services, and special consultancies for individuals, groups, and institutions
involved in similar domains. PARC relies on
the broad and efficient participation of its
beneficiaries, and moreover, on developing
the qualifications of its experts to better benefit and develop a democratic Palestinian
civil society

H

H

M

H

Palestinian Water
Authority( PWA )

PWA acts as the regulatory authority responsible for the legislation, monitoring and human resources development in the sector.
The PWA is also in charge of water resources management. It has the mandate to carryout regular inspections and to keep a register of all water related data and information

M

L

L

L

27

28

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

BUSINESS SERVICES NETWORKCIVIL SOCIETY NETWORK

These are associations, or major representatives, of commercial service providers used by exporters to carry out
international trade transactions.

These institutions are not explicitly engaged in trade related activities. They are often opinion leaders representing interests that have a bearing on the country’s export
potential and socioeconomic development.

Table 16 : Palestinian business services network
Business services network
Name

Function / role

Coordination HR / humancapitalFinancialsustainability

Advocacy

Palestinian Farmers PFU consists of a group of Palestinian asUnion ( PFU )sociations that aims for significantly contribution towards raising general awarenessinterim of economic, social political ,rights
for the 3040 farmer members belongs to
75 cooperatives

M

L

L

M

Reef for Agricultural
Investment andMarketing Co.
( RIM )( RIM ) is a non-profit company that provides packing and logistics.

M

H

L

M

Arab Agronomists
Association ( AAA )AAA is a non-profit and non-governmentalorganization that supports organic farming through different involvements along
the value chain. AAA is involved throughout in implementing different projects andactivities to maintain GAP as the benchmark for targeting the market

M

M

L

L

Financialsustainability

Advocacy

Table 17 : Palestinian civil society network
Civil society network
Name

Function / role

Coordination HR / humancapitalBirzait
University

Institution of higher education to be established in theState of Palestine.

M

M

L

L

AppliedResearch
Institute of
Jerusalem( ARIJ )ARIJ promotes sustainable development in theoccupied Palestinian territories and the self-reliance of the Palestinian people through greater control over their natural resources. ARIJ aims
to assess alternative options, policies and strategies to conserve natural resources, which canbe used as the basis for formulating recommendations and informing strategic decision-making
to improve the management of these resources
and assist in their sustainability.

M

M

M

L

Economic& Social
Development
Center( ESDC )The ESDC works to gear self-help community-based groups, including cooperatives, to become self-reliant. The ESDC believes in thevalues of solidarity, equality, self-responsibility,
democracy and social justice.

L

L

L

L

VALUE CHAIN OPERATIONS

In a resource-constrained economy such as the State ofPalestine, the need to ensure coordination among TSIs isvery important. In the absence of coordination, redundancies and overlaps result in wastage of effort and valuable
resources, and on the other hand lead to gaps in service
delivery. From the perspective of Palestinian fresh fruits,
vegetables and herbs sector stakeholders, few institutions have been identified as being significantly limited interms of coordinating their service delivery. Those identified are MoHE, MoF, MoWA and ESDC, which are notplanning their interventions for the sector sufficiently incoordination with other ministries or institutions.
According to the assessment, almost all institutions sufferfrom significant human capital deficiencies. Either there isa need to improve the skills levels of the staff for these institutions, or there is a need for organizational alignment.
The few institutions considered as having adequate human resources are MoH, MoL, MoF, PARC and the Arab
Agronomist Association.
From the perspective of financial stability, PalTrade,
PARC, and ARIJ are the only institutions considered as
possessing adequate financial resources to complete
their mandate. The fact that most institutions are considered financially constrained may stem from the economic crisis that is affecting the State of Palestine, due towhich funds allocation is affected at all levels, including
ministries.
Advocacy is also a very important aspect of the work of
TSIs and serves to inform beneficiaries ( current and potential exporting enterprises ) of the services available tothem and other important information. Advocacy is also
important to raise awareness about certain critical issues
affecting the development of trade and export. This area
has been cited as a significant weakness for all institutions with the exception of PalTrade and PARC. This diresituation indicates that it is or will be very difficult for TSIs
related to the FFVH sector to actively lobby in favour ofthe sector.

PERCEPTION OF PALESTINIAN TRADESUPPORT INSTITUTIONS ( TSIS )IN THE FFVH SECTOR – INFLUENCE
VS. CAPACITY
The above analysis resulted in a multidimensional assessment of the capacities of TSIs to respond to theneeds of FFVH sector enterprises. This analysis can befurther developed by considering another dimension : thelevel of influence the TSI possesses over sector stakeholders. This classification represents the sector stakeholders’ perception of the level of influence and capacity
to respond of each institution.
Table 14 represents this classification for trade support
institutions supporting the FFVH sector.
According to the perceived influence and capacity ofTSIs, it has been considered that institutions at policymaking level have a high degree of influence due to theirmandate. However, it appears that these institutions arelimited in their capacity to support the sector because of
their overall low levels of resources. This situation may explain why enterprises experience significant delays when
applying for export permits, health certificates, etc. The
high degree of staff turnover at TSIs, especially within
ministries, also has a significant influence on the level of
efficiency, leading to low capacities.
Only two TSIs, PalTrade and PARC, are assessed to havethe desired high-high combination for FFVH sector enterprises. This implies that these organisations are currently
in the best position to contribute to the sector’s development through targeted initiatives.
Two institutions which are critical to the developmentof the FFVH sector, PSI and PCBS, have both been assessed to have a low level of influence as well as low capacity to respond to sector stakeholder needs. This is asignificant constraint, as both institutions are critical fromthe perspective of export competitiveness.

Table 18 : FFVH stakeholders’ perception of TSIs’ level of influence and capacity

Levelof influenceon the sector

High• Ministry of Agriculture• Ministry of National Economy• Ministry of Health

Low• Ministry of Women’s Affairs• Palestine Standards Institution• Palestinian Central Bureau of Statistics• Ministry of Labour• Birzeit University
Low• Agricultural Development Association( PARC )• PalTrade

High
Capacity of institution to respond to sector’s needs

29

30

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Table 19 : Development activities in the FFVH sector
Project

StatusFunding agency /lead implementer

The Compete Project

Ongoing

USAID

Enhancing Palestinian Farmers’
Preparedness for Exports

Ongoing

The Netherlands• Good agricultural practices– Centre for the Promotion • Marketing capabilities
of Imports from• Enhance the logistics and supply
Developing Countries
chain infrastructure

Intajuna

ClosedSwiss Agency for
Development andCooperation• Technical upgrading• Promotional campaigns• Advocacy

Improved Access to Markets for
Female and Male Small-Scale
Farmers in the West Bank

PlannedSwiss Agency for
Development andCooperation• Enhance employment and income
opportunities of farmer households.

Expected areas of intervention• Management and marketing capacities• Development of quality standards• Establish marketing information• Quality and safety certification

SECTOR DEVELOPMENT
INITIATIVESSELECT INITIATIVES CURRENTLY
ACTIVE IN THE SECTOR

The analysis of ongoing development activities in the
FFVH sector is relevant insofar as it serves to identify
the main thrusts of the various development actors andtheir initiatives, while also identifying duplications, gaps
and areas of neglect. The latter is especially important as
identified gaps will be further analysed, and addressed
through specific interventions in the sector’s strategicplan of action ( PoA ).

 The USAID Compete project, which ends in 2017,seeks to enhance the competitiveness of Palestinian
fresh fruits and vegetables producers, while at thesame time stimulating a more organised and structured agricultural sector. To this end, it will focus on
enhancing capacities in management and marketing.
It will also contribute to the development of quality
standards, stimulate efforts to prioritize regulatory
reform of the business climate, establish a marketing information system to better organize the sector,
and help export-ready enterprises acquire quality andsafety certification.
 The Netherlands is administering their Enhancing
Palestinian Farmers’ Preparedness for Exports programme through 2017, with the goal of enhancing thestandards of local producers and improving the performance of Palestinian FFV producers in the global
markets. The programme will promote good agricultural practices among farmers, support the marketing capabilities for both domestic and foreign sales,enhance the logistics and supply chain infrastructure,and provide partial support for physical inputs.
 The Swiss Agency for Development and Cooperation’s
Intajuna programme, which came to a close in 2010,
contributed to technical upgrading, promotional campaigns and advocacy, while at the same time facilitating market access and linkages. As a result, over 20
new standards for fresh produce were created. An FFV
committee was formed with the participation of key
players and it is still working to develop new standards.
The SDC is currently working on a follow-up project
aimed at enhancing employment and income opportunities of farmer households.

Having recognised the importance of the fresh fruits,
vegetables and herbs sector for both employment andeconomic stability, a number of donors and development organisations have committed to administering
programmes aimed at strengthening sector capacities.
These include the official development and aid agencies of : the United States, the EU, FAO / UN, Japan, theUnited Kingdom, the Netherlands, Switzerland, France,
Italy and Canada.
Project focus areas have included :21
 Technical assistance, technology transfer, capital investment and market access assistance ( including GLOBALGAP compliance ) for Palestinian
agribusinesses,
 Grant funding for greenhouses, water management
and irrigation,
 Financial access and loan guarantee funding, Trade facilitation and efficacy, and Rehabilitation and strengthening of the olive and ruminant sectors.
21. TechnoServe ( Oct. 2011 ). A roadmap for the Agribusiness

Development in the Palestinian Occupied Territories.

VALUE CHAIN OPERATIONS

Source: © PalTrade For the fresh herbs subsector, the USAID Compete
project has been working with stakeholders to build
awareness and support for a Palestinian Fresh Herbs
Association. This association will provide memberswith a platform which they can use to leverage collective action, obtain advocacy and communication
services, and align the industry to international standards. Early efforts are focused on promoting collective
marketing, stimulating responsible pesticide usage,and improving environmental and sanitary / phytosanitary conditions within the sector.

KEY AREAS TO FOCUS ON
The work of development agencies has thus far touched
upon a number of vital issues that are sure to increase
both capacities and competitiveness of the sector. Efforts
have, however, been targeted largely at export-readyenterprises and focused on specific areas of the value
chain such as production capacities for more advanced
farmers, quality and standards, and sales and marketing linkages. There are, therefore, a number of areasthat must be further addressed by the wider donor
community.
 Of particular importance is the enhancement of smallholder production that would allow new producers topenetrate export markets. Although work has alreadybeen done to increase these capacities, the vast majority of farmers perform only limited cultivation of highvalue goods for export. This is in part due to lack ofawareness about crop profitability, but is also a resultof poor information with regards to relative productivity,
market trends and prices, and growing and phytosanitary practices.

 More work needs to be done to persuade smallholdersof the benefits to be gained by gearing their production
towards export crops, while at the same time providingthem with the informational and practical tools needed
to realize this production.
 Moreover, the work that has been done to increase
the quality and safety management of the sector must
be expanded to smallholder farmers who generally
do not practice Good Agricultural Practices or Hazard
Analysis and Critical Control Points. Not only do thesefarmers lack awareness of good agronomic practices,
but there is also the need to facilitate financial accessso that they can use proper equipment. Such advancements will have significant effects on the quality andsafety of smallholder production, validating any investments made in export-ready crops and opening thedoors to wider markets
 As the largest purveyor of jobs for the Palestinian
population, the agricultural sector should be the focus of more interventions aiming at raising agricultural productivity, achieving larger yields and reachingeconomies of scale.
 Donors should also support projects aiming at fostering greater cooperation among FFVH producers andexporters including support for cooperatives, resource
pooling, export clustering and labelling initiatives, inorder to encourage defragmentation of the economy
and achieve economies of scale.
 Specific interventions should target the role of womenand youth in agricultural production and provide support aiming at a better integration of women an youth
in export value chains.
 Specific support in terms of trade facilitation measures designed for the FFVH sector such as cold storage and handling facilities at commercial crossings,
reduced customs clearance times and authorized
traders programmes should be supported by donors
as well.

31

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Box 3 : Palestinian agricultural sector strategy 2011-2013
Agriculture is an essential component of the Palestinian national, cultural, economic and social
fabric. The Palestinian agricultural community, led by the Ministry of Agriculture and supportedby the Food and Agriculture Organization of the United Nations ( FAO ), has developed theAgriculture Sector Strategy : “A Shared Vision” 2011-2013, with an evidence-based action plan.
The strategy underlines broad challenges faced by the Palestinian agricultural sector including access to finance, the provision of insurance, and marketing, among others. It also carries
out a SWOT analysis for the sector and evaluates the role of agriculture within the Palestinian
economy, underlining its importance for national exports.
The strategy envisions sustainable agriculture that is capable of the following : Achieving food security,
 Being competitive in local and foreign markets through optimal use of resources, and Cementing the bonds and sovereignty of Palestinians over their land, towards building a state.
The strategy also proposes actions to address some of the above issues, focusing in particular on establishing a quality infrastructure and a qualified and well-trained workforce, improving production in both crops and livestock, and increasing the efficiency of natural resourcesmanagement.

EXPORT COMPETITIVENESS ISSUES

n
tio
mo
ro ingl P ndna ra
tio d BNa an

Development Issues

Market Accessand Policy ReformTrad
Se e Sur vi ppce or ts

Poverty Alleviation
and Gender Issues

Fa Trad
cil e
ita
tio
n

Cost of
Doing Business
d
an
re rm
ctu efotru R
es r yra atoInf egulR Social and economic concerns include poverty reduction, gender equity, youth development, environmental sustainability and regional integration.

Capacity
Development

nt
me
lop
eve ionl D ratna eg
gio Int
R e and

The analysis presents those majors constraints that are
currently main export competitiveness bottlenecks for
the FFVH sector in the State of Palestine. However, theassessment also explores issues limiting socioeconomic
spillovers of exports to the society at large :Border Issues

lskil hipg s rsini neu
lop reve repDe Entdan Supply side issues impact production capacity andinclude challenges in areas such as availability of
appropriate skills and competencies, diversification
capacity, technology, and low value addition in the
sector’s products.
 The quality of the business environment issues areconstraints that influence transaction costs, such as
regulatory environment, administrative procedures anddocumentation, infrastructure bottlenecks, certification
costs, internet access and cost of support services.
 Market entry issues are essentially external to thecountry ( but may also be manifested internally ), suchas market access, market development, market diversification and export promotion.

Border-In Issues

Di Ca
ve pa
rs ci
ifi tycation

The export constraints analysis uses a four gears framework presented below to determine the major concerns
to export development.

E
Su nviros
Cli taina nme
ma bi nta
te lity l
Ch an
an d
ge

32

Border-Out Issues

VALUE CHAIN OPERATIONSTHE BORDER-IN GEAR ( SUPPLY-SIDE )Box 4 : Overview of supply-side issues related to the Palestinian FFVH sector
 The shortage of fertilizers throughout the State of Palestine adversely affects the yield andproduction capacity of producers.
 Restrictions on access to fertile land in Area C further affect the productivity of the Palestinian
agriculture sector.
 Lack of quality control on agricultural inputs, especially those imported from Israel, adversely
affects productivity.
 Shortage of irrigation water in the State of Palestine hampers agricultural activities in theWest Bank.
 Fragmented and small-sized agricultural holdings lead to low and unpredictable yields.
 Traditional belief systems have contributed to the reluctance of Palestinian producers toaccept cooperatives and producer associations as legitimate business entities.
 Long dependence on the domestic market has led to irregular product quality.
 Limited cultivation of high value, export variety crops results in loss of potential export income.
 Poor agronomic practices are constraining small-scale farmer operations.
 High turnover of skilled workers in the sector is adversely affecting the productivity andsustainability of the sector.

THE SHORTAGE OF FERTILIZERSAND PESTICIDES THROUGHOUT THE STATE
OF PALESTINE ADVERSELY AFFECTS
THE YIELD AND PRODUCTION CAPACITY
OF PRODUCERS
Israeli restrictions on the import of dual-use items means
there is a perennial shortage of many types of inputs, inparticular fertilizers and pesticides. Accounting for the
possibility that these restrictions are unlikely to be removed soon, there is a need to support the search for alternatives and promote land reclamation activities which
provide rich yields with minimum fertilization requirements. Similarly, there is a need to develop support andawareness of integrated pest management approaches
and use of natural fertilizers.

RESTRICTIONS ON ACCESS TO FERTILE
LAND IN AREA C FURTHER AFFECT THE
PRODUCTIVITY OF THE PALESTINIANAGRICULTURE SECTORThe Israeli military controls nearly 60 % of Area C, and in
the process imposes significant restrictions on access toagricultural land, water resources and infrastructure in thearea. The effect on agricultural yields is tremendous giventhat 63 % of the total arable land in the State of Palestine
lies in Area C.

LACK OF QUALITY CONTROL ON AGRI­CULTURAL INPUTS, ESPECIALLY THOSEIMPORTED FROM ISRAEL, ADVERSELY
AFFECTS PRODUCTIVITY
The Palestinian agricultural sector depends heavily on
imports for agricultural inputs including seeds, seedlings,
pesticides, etc. Weak monitoring and compliance mechanisms in the State of Palestine have resulted in low quality
imports passing through easily and without penalty. Thishas significantly affected the yield and productivity in the
sector. For instance, there is a proliferation of low quality
organic fertilizers in the Jordan valley area which are actually recycled Israeli waste material. Some of the inputs( in particular, pesticides and fertilizers ) have proven to
be ineffective.
Part of the solution lies in increasing the supply of locally produced inputs and developing advocacy campaigns aimed at informing farmers about alternatives, butequally important is the need for better market regulationand surveillance in terms of technical requirements andstandards. It will also be important to develop and deploy
efficient systems for monitoring the quality of raw materials. The updating of quality requirements / standards forimports of inputs is also important. This extends to pesticides, for which there are existing technical regulationsin the State of Palestine but no standards.

33

34

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBSSHORTAGE OF IRRIGATION WATER IN THE
STATE OF PALESTINE HAMPERS AGRI­CULTURAL ACTIVITIES IN THE WEST BANK
Israeli restrictions on groundwater supply continue tohamper agricultural development in the State of Palestine,
especially in the West Bank. This is because of the political uncertainty surrounding the joint management ofwater resources between Israel and the State of Palestine,
as well as weaknesses in water management on thePalestinian National Authority ( PNA ) side.
Article 40 of the Oslo Accord calls for decisions by consensus between Israel and the State of Palestine in areas
such as water management through a joint management
framework. However, the actual implementation of thejoint framework has led to predominance by Israel in
the allocation and management of West Bank water resources22 rather than facilitating equitable distribution. In
the West Bank alone, an estimated 82 % of the groundwater – supplied by groundwater wells and springs – iscontrolled by Israel for redistribution between the Stateof Palestine and Israel. This situation points out someof the inequities affecting supply of water to the West
Bank, which consequently have an adverse impact on
the Palestinian agriculture sector 23 : Israel is the residual downstream beneficiary of thewater resources in the three shared West Bank aquifers and can extract downstream the quantity it
chooses without consultation. Article 40 thus allows
Israeli authorities to limit the quantum extracted by the
Palestinians in the West Bank, but does not conversely
grant the PNA the right to limit Israeli withdrawals, neither in Israel nor in the West Bank.
 Israeli authorities have an effective veto over all PNA
water resource extraction and infrastructure projects( but not vice versa ) and take action by force when
they choose.
 The PNA has de facto no control over Israeli acts
within Area C. As most water infrastructure has a footprint within Area C, Israel can impose further regulation on Palestinian infrastructure, but not vice versa.
Even in Area A or B, Palestinian projects require coordination with Israeli authorities to get through theIsraeli-imposed import and mergers and acquisitions
restrictions.
While Israeli dominance in controlling water supply undoubtedly contributes to the shortage of irrigation waterin the West Bank, the PNA and individual enterprises bear
responsibility for poor water management and bad agricultural practices. Countermeasures should include facilitating better waste management ( to conserve valuable

water resources ) and promotion of best practices for utilization of water resources. For instance, while the Tulkarm
area ( Al Sharawei ) regularly reports excess water supply,
the nearby cultivated lands in Jenin routinely face paucity
of water supply for irrigation purposes. A feasible ( andcurrently unimplemented ) solution lies in diverting waterfrom Al Sharawei to Jenin.
In general, authorities have limited resources at theirdisposal to manage and develop district level water resources effectively. Potential solutions such as collecting
and storing rainwater as a means to alleviate the water
shortage require funding and technical expertise which
are both difficult to procure in the current economic climate in the State of Palestine.

FRAGMENTED AND SMALL-SIZEDAGRICULTURAL HOLDINGS LEAD
TO LOW AND UNPREDICTABLE YIELDS
The agriculture sector is characterized by small-scale
holdings and operations. Small farmers are estimated tocomprise 80 % of the total number of farmers but accountfor less than 50 % of total production 24. In the majority ofcases, small landholdings are the sole income source
and / or livelihood for the landowners and the natural consequence is widespread recourse to intensive farming
practices, which in turn leads to a gradual but progressive decrease in yields and soil depletion. Relevant programmes aimed at increasing the awareness of proper
land usage and encouraging crop recycling need to be
developed.

TRADITIONAL BELIEF SYSTEMSHAVE CONTRIBUTED TO THE RELUCTANCE
OF PALESTINIAN PRODUCERS
TO VIEW COOPERATIVES AND PRODUCER
ASSOCIATIONS AS LEGITIMATE BUSINESSENTITIES
Given the historical positioning of the agriculture sector asa source of sustenance, coupled with a certain degree of
isolation developed due to movement restrictions, certain
practices and beliefs have become entrenched in the
sector. One of these relates to the level of acceptance ofcooperatives and associations as formal business entities
by producers. This issue is more prevalent in the WestBank than in Gaza. A recent report by TechnoServe 25
notes that there is scepticism in some areas about formal
registration of cooperatives and farms as businesses due
to long-held beliefs that agriculture is not a business but
24. TechnoServe ( 2011 ). A Roadmap for Agribusiness Development

22. World Bank ( 2009 ). Assesment of restrictions on Palestinian

water sector development - Report No. 47657-GZ, p. 33
23. Ibid., p. 34

in the Occupied Palestinian Territories : An Analysis of the
Vegetables & Herbs, Dairy, and Sheep & Goats Subsectors, p. 10
25. Ibid., p. 33

VALUE CHAIN OPERATIONS

a traditional means of subsistence. Moreover, the rate ofparticipation in cooperative activities among stakeholders involved in irrigated agriculture stands at a low 29 %.
This low percentage reflects the lack of confidence inthese cooperatives but is also a function of the distanceof these associations from zones of production.
Greater organization in the fruits and vegetables sector
can have significant benefits. For instance, challenges resulting from the fragmented and small per capita
yield structure in the State of Palestine can be obviatedto an extent by improving producer organization levels
and registering cooperatives and farms as businesses– thus leveraging the benefits of collective bargaining etc.
Individual producers and exporters are largely unable
to use high quality packaging facilities ( few are available in the State of Palestine ) as the costs are too steep.
Collective bargaining can also serve to bring down average costs. Associations can also help not only in raisingawareness but also in implementation of quality practices
and standards such as ISO 9001, ISO 22000 / HACCP,
and GLOBALGAP.
Overall, there is a high level of resistance to new ideas
within the producer base thanks to decades of operating in a survivalist mode, and low levels of trust in joining
forces. A sustained change management strategy will
be required for these cooperatives to operate successfully as businesses and in return contribute to changing
perceptions.

LONG DEPENDENCE ON THE DOMESTIC
MARKET HAS LED TO IRREGULAR PRODUCTQUALITY
The fruits and vegetables sector has traditionally catered
to the domestic market, which is more tolerant of variable product quality levels than international markets.
Consequently, product quality in the FFVH sector has
tended to be irregular and lean towards the lower end.
To improve quality levels, enterprises will need to invest ;an unlikely proposition in the current economic climate.
To an extent, the domestic sector offers a viable and low
cost alternative to international markets, which will necessitate operating and investment cost increases. Therefore
the export market alone does not in itself form a strong
value proposition for making these investments. A recent report by TechnoServe found that, while the small
size of the domestic market in the State of Palestine necessitates an export-based approach for sustainable future growth, there do exist local opportunities to improvemargins for small farmers,26 and for improving their value
chains so that they are prepared for future market developments such as ‘supermarkets, which will likely arrive

26. Ibid., p. 41

in the urban centres of the State of Palestine in the near
future’.27 Therefore, there may exist a viable business casefor enterprises to improve quality levels while catering to
the domestic sector. Over time, the strengthened value
chain will allow enterprises to increase penetration in international markets as well.

LIMITED CULTIVATION OF HIGH VALUE,EXPORT VARIETY CROPS RESULTS
IN LOSS OF POTENTIAL EXPORT INCOME
There is a variety of reasons for the low cultivation levelsof export variety crops in the fruits and vegetables sector.
One of the contributing causes is the lack of information
available to producers about profitable crops. There is
no available database that provides information related
to growing varieties of fresh vegetable produce such as : Relative productivity,
 Market trends and prices per target market,
 Growing seasons and life cycles of the cultivation
process,
 Irrigation requirements,
 Diseases to which the crop is susceptible.
Another reason is simply the lack of experience ofPalestinian small-scale farmers in producing export-oriented varieties. Given their difficult operating environment
and the small per capita farm size, they are relatively risk
adverse and opt against experimentation with new crops
with which they have no experience. The presence ofspecific information and a specialized, agriculture-dedicated financial mechanism could contribute to incentivizing producers.

POOR AGRONOMIC PRACTICES ARECONSTRAINING SMALL-SCALE FARMEROPERATIONSSound agronomic practices constitute the foundationof any agricultural sector, especially one with an exportoriented dimension. In general, Palestinian small-scale
farmers do not practice Good Agricultural Practices( GAP ) and Hazard Analysis and Critical Control Points( HACCP ). There is a need to raise awareness of good
production and handling practices and impart continuous practical / vocational training programmes to farmers
and workers in processing companies. Public awarenesscampaigns involving demonstrations of success-based
case studies that highlight the correlation between improved farm management practices with increased quality yields will also help secure buy-in.

27. Ibid., p. 41

35

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THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Government-based agricultural extension services arealso underfunded, and generally inadequate for covering
the entire sector. Private-sector-based ( paid ) extension
services have not found broad acceptance by the sector.
In the Palestinian fresh fruits and vegetables sector, lackof awareness of good agricultural practices and lack offinancial resources go hand in hand. As an example,
greenhouses typically use very old and ineffective plastic covers. While there is a need to increase awarenessof the need to discard the plastic after a certain period,
this alone will not resolve the root cause : that farmers are
generally cash-strapped and may not be able to makethe investments in new covers even if they are aware of
the need to do so.
Another contributing cause is poor documentation practices that have persisted through the decades. Farming
practices in the State of Palestine are handed down fromgeneration to generation, and there is very little documentation on lessons learned from past experience. This prevents a feedback loop – where enterprises in the sector
can apply lessons learned into their existing practices –from taking shape.

HIGH TURNOVER OF SKILLED WORKERS
IN THE SECTOR IS ADVERSELY AFFECTING
THE PRODUCTIVITY AND SUSTAINABILITY
OF THE SECTOR

sustainability of enterprises, there are not enough incentives to retain workers.

THE BORDER GEAR ( QUALITY OF THE
BUSINESS ENVIRONMENT )LACK OF INTERNATIONAL ACCREDITATIONFOR FOOD TESTING LABORATORIES IN THE
STATE OF PALESTINE RESULTS IN REDUCEDTARGET MARKET CONFIDENCE FORPALESTINIAN AGRICULTURAL EXPORTS
Gaining accreditation for an exporting country’s foodlaboratory by the importing country’s accreditation centre is a mechanism for building confidence for exports intarget markets, and also facilitating smooth flow of goods
by reducing the risk of rejection at borders. None of thefood testing laboratories in the State of Palestine has any
international accreditation. A network of laboratories with
ISO 17025 ( general requirements for the competence oftesting and calibration laboratories ) and other internationally recognized standards would significantly boost
the competencies of testing and calibration laboratories
in the State of Palestine, while boosting confidence intarget markets.

The Palestinian agriculture sector is characterized byhigh turnover of skilled workers. Given the multitude ofchallenges that the sector faces and the resulting lack ofBox 5 : Overview of FFVH sector business environment issues
 Lack of international accreditation for food testing laboratories in the State of Palestine results
in reduced target market confidence for Palestinian agricultural exports.
 A weak sanitary and phytosanitary ( SPS ) framework in the State of Palestine leads to a
reduction in agricultural export flows to target markets.
 Lack of compliance with the internationally recognized standards contained in the Codex
Alimentarius affects conformity with best practices.
 Weak cold chain infrastructure in the State of Palestine and at border crossings leads to highwastage volumes during transit.
 Access to capital is a significant barrier to entry for enterprises in the sector.
 Weak coordination between the TSIs involved in supporting the agricultural sector leads todelays.
 Israeli middlemen as the only option for sourcing agricultural inputs weakens the bargaining
power of Palestinian producers and increases their cost of doing business.
 Shipping costs incurred in sending samples to clients make it an unsustainable practice forexporters.

VALUE CHAIN OPERATIONSA WEAK SANITARY AND PHYTOSANITARY( SPS ) FRAMEWORK IN THE STATE
OF PALESTINE LEADS TO A REDUCTION
IN AGRICULTURAL EXPORT FLOWSTO TARGET MARKETSSPS measures are designed to protect human, animaland plant health and frequently serve as an entry barrier
for exports from developing countries. Under the WTO
SPS Agreement of 1995, member countries have a rightto demand information on imported products and theircomponents throughout the value chain as a means ofmaintaining traceability. Traceability systems require significant resources, information, and technology-based
infrastructure, as well as discipline at both institutionaland enterprise levels.
In the State of Palestine, traceability systems are virtually
non-existent and not mandated by the authorities as astandard process to be followed by producers of fresh
produce. No technical regulations are in place for sellingin local or international markets. Since most farmers cater to the domestic market, agricultural practices do notinclude stress on documentation. This has a significant
bearing on the export competitiveness of fresh produce
exports from the State of Palestine, as has been evidenced by recent instances of exports being rejected at
the borders. There is thus an imperative to introduce andimplement tracking and labelling systems. In this regard,
regulations must be passed / amended to bring domestic

traceability-based standards in line with international
standards ; and in parallel develop training / awarenessbuilding programmes targeted at producers.

LACK OF COMPLIANCE WITH THE
INTERNATIONALLY RECOGNIZEDSTANDARDS CONTAINED IN THE CODEX
ALIMENTARIUS AFFECTS CONFORMITYWITH BEST PRACTICESAs part of the WTO SPS Agreement, the joint FAO / WHO
Codex Alimentarius Commission ( also known as the
Codex ) has been designated as the ‘relevant standard-setting organization for food safety’. 28 The Codex
Alimentarius is a set of international food safety standards that have been adopted by the Commission. Thesestandards have become the de facto baseline requirements in the trade of processed, semi-processed andunprocessed agricultural products.
The Codex recommends pro-active inspections andsanctions to maintain food safety, while in the State ofPalestine the opposite approach of ex-post inspections
and sanctions is the norm. This stems from the lack ofnational legislation for food safety that adopts the international Codex as the national guiding principles.

28. World Trade OrganisationBox 6 : The Codex Alimentarius Commission
In the early 1960s the Food and Agriculture Organization ( FAO ) of the United Nations andthe World Health Organization ( WHO ) recognized the importance of developing international
standards for the purposes of protecting public health and minimizing disruption of international
food trade. The Joint FAO / WHO Food Standards Programme was established, and the Codex
Alimentarius Commission was designated to administer the programme.
The founders who established the Food Standards Programme and the Codex Alimentarius
Commission were concerned with protecting the health of consumers and ensuring fair practices in the food trade. They felt that both of these objectives could be best met if countries
harmonized their food regulations and adopted internationally agreed standards. Throughharmonization, they envisaged fewer barriers to trade and a freer movement of food products
among countries, which would be to the benefit of farmers and their families and would also
help to reduce hunger and poverty. They concluded that the Food Standards Programme would
be a solution to some of the difficulties that were impeding free trade.
Over the years, the Codex has developed over 200 standards covering processed, semi-processed or unprocessed foods intended for sale for the consumer or for intermediate processing;developed over 40 hygienic and technological codes of practice ; evaluated over 1,000 foodadditives and 54 veterinary drugs ; set more than 3,000 maximum levels for pesticide residues ;and specified over 30 guidelines for contaminants.

37

38

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBSWEAK COLD CHAIN INFRASTRUCTURE
IN THE STATE OF PALESTINE AND
AT BORDER CROSSINGS LEADS TO HIGHWASTAGE VOLUMES DURING TRANSIT

frequently resulting in delays. There is an urgent to improve the application process so it is simplified and canpotentially be executed through a single office.

A strong cold chain infrastructure is very important for the
fresh fruits and vegetables sector given the high scopefor perishability of the sector’s products. From harvesting to the point of delivery to the customer, the cold chain
serves a critical role in ensuring product quality and shelflife, thereby preventing product wastage. In the State ofPalestine the cold chain infrastructure is weak, mainly
due to irregular power supply and to the paucity of equipment such as freezers and generators. The high cost offuel and electricity needed to power such equipment isanother important factor.

ISRAELI MIDDLEMEN AS THE ONLY OPTIONFOR SOURCING AGRICULTURAL INPUTSWEAKENS THE BARGAINING POWER OFPALESTINIAN PRODUCERS AND INCREASESTHEIR COST OF DOING BUSINESSACCESS TO CREDIT IS A SIGNIFICANTBARRIER TO MARKET ENTRY
FOR ENTERPRISES IN THE SECTOR
Producers and exporters face considerable constraints inaccessing credit to offset the lack of operating and investment capital at their disposal. High interest rates charged
by banks limit opportunities for small and medium producers and processors to upgrade capital equipment
and make other investments. While Palestinian banks doprovide loan programmes for entrepreneurs, there is aneed to develop dedicated loan instruments for the agricultural sector. High collateral requirements by banks
are also responsible for the low proportion of loans takenout by the agricultural sector. Collateral challenges arecompounded by a slow and difficult land titling system.

WEAK COORDINATION BETWEENTHE TSIS INVOLVED IN SUPPORTING THE
AGRICULTURAL SECTOR LEADS TO DELAYS
Palestinian exporters wishing to export agricultural goods
must apply for and receive a Certificate of Health thatcomplies with Palestinian export regulations. The procedure involved in applying for this certificate is onerous
and involves coordination with different line ministries,

As discussed earlier, the Palestinian agriculture sector
depends heavily on the import of inputs used in the cultivation process. There is very limited local production for
most of the inputs. The importing process is structured insuch a way that farmers have to use Israeli middlemen forthe bulk of purchases. Palestinian producers have typically not benefited from this relationship and have occupieda weak bargaining position driven by the lack of options.
The Palestinian Agricultural Strategy notes that Israeli
middlemen / mediators typically add large profit margins
to the inputs that they sell to Palestinians 29. This results
in an overall increase in the cost of doing business forPalestinian producers. There is a need to support competition in the local market on one hand, and encourage
new investments to produce essential agricultural inputs
locally on the other hand.

SHIPPING COSTS INCURRED IN SENDINGSAMPLES TO CLIENTS MAKE IT AN UNSUSTAINABLE PRACTICE FOR EXPORTERS
Palestinian exporters are often asked to send samples
to international markets for testing, given the absenceof internationally accredited laboratories. The shipping
costs and related fees are often beyond the reach of theaverage Palestinian small farmer.

THE BORDER OUT GEAR
( MARKET ENTRY )29. Ministry of Agriculture ( MoA ) ( 2010 ). Agriculture Sector

Strategy : “A Shared Vision” 2011-2013, p. ix.

Box 7 : Overview of market entry issues for the FFVH sector
 The traditional focus of donor projects has neglected marketing in the sector.
 Trade information available to the sector suffers from poor content and accessibility
challenges.
 Poor sector organization is hindering export promotion and branding efforts.

VALUE CHAIN OPERATIONSTHE TRADITIONAL FOCUS OF DONORPROJECTS HAS NEGLECTED MARKETING
IN THE SECTOR

POOR SECTOR ORGANIZATIONIS HINDERING EXPORT PROMOTION
AND BRANDING EFFORTS

Financial support from ministries, donors and technicalpartners for the agriculture sector in the State of Palestinehas, until recently, been restricted to areas such as infrastructure development, land reclamation and so on.
Marketing has typically not been addressed as part ofdevelopment initiatives, and as a result current and potential exporters in the fruits and vegetables sector haverelatively low capacity in this area.

To build export competitiveness, the fresh fruits and vegetables sector must have an established brand outside
the country. Ensuring that the sector’s products are ofhigh quality and supplied with consistency is a given prerequisite in this regard. Another important dimension isdeveloping an effective brand promotion campaign totarget markets.

TRADE INFORMATION AVAILABLE TO THE
SECTOR SUFFERS FROM POOR CONTENT
AND ACCESSIBILITY CHALLENGES
Access to timely and relevant market intelligence is aprerequisite for building export competitiveness in a sector. This information includes consumer trends and target market needs. This requirement plays an even more
prominent role considering that Palestinian enterprisesin the FFVH sector, due to their structure, are inexperienced in market penetration and development. For the
fresh fruits and vegetables sector, trade information iscurrently available in an ad hoc fashion, mainly throughlocal trade associations and chambers of commerce. It is
important to centralize the collection and dissemination of
trade information, as well as making it easier to access.
Information on buyers’ requirements – assessment of important preferences such as ‘supply consistency’, ‘rangeof product varieties’ and so on by target market – is notreadily available. The absence of this information prevents
exporters from assessing the factors that are critical tosucceed in a specific target market. For instance, UnitedStates import regulations are relatively flexible in termsof allowing chemical residues in the product, while EU
regulations are far more stringent on chemical residue
from pesticides. In terms of buyers’ requirements, thisconstitutes a critical success factor for exporters wishing
to develop exports to the EU. In practical terms, this may
involve separating production lines for the two markets. In
any case, the first step is to make this information readily
available to sector stakeholders.

Box 8 : Overview of FFVH development issues
 Unequal rights for women in the agriculture sector

The small per capita size of landholdings and the lowlevel of organization among producers in the sector havepartly contributed to slow branding and promotion efforts.
While there are cooperatives that bring together producers and exporters, the level of cooperation has been low.
Furthermore, there is broad resistance among members
towards registering cooperatives or associations of producers as business entities. Such joint commercial entities could indeed leverage collective strengths towards
greater supply, quality, branding and promotion.

DEVELOPMENT GEAR
Poverty alleviation and gender inclusivenessDespite playing a significant role in the State of Palestine’s
agriculture sector, women are not granted equal assets
and have limited autonomy in terms of decision-making. Equity issues range from areas such as land / capital equipment ownership rights and merit-based rise to
middle and upper management, to new business development and product branding. Targeted efforts atstrengthening the opportunities of women in the FFVH
sector would serve to generate additional employment
as well as provide new growth potential.

39Source: © PalTradeWHERE WE WANT TO GO

WHERE WE WANT TO GO :OPTIONS FOR FUTURE DEVELOPMENT
The following vision has been developed towards thegoal of increasing the export competitiveness in thePalestinian FFVH sector.

“”

To get high quality, competitive, Palestinian branded
fresh produce accessing global markets.

The scope for improvements in the FFVH sector is immense and extends along the value chain. In some cases
it involves strengthening existing linkages, while in otherareas structural modifications to the sector are required.
Both these types of improvements must lead to market
penetration (increasing exports in existing markets), product development ( increasing exports of new products inexisting markets ), market development ( increasing exports of existing products in new markets ), and full diversification ( increasing exports of new products in newmarkets ).
This envisaged future state of the FFVH sector is discussed in greater detail below.

 A market-related component involving identification of
key markets in the short and medium to long term forPalestinian exporters, and Structural changes to the value chain that result in either strengthening of linkages or introduction of new
structural linkages.
The market identification was based on a combination of
trade analysis conducted by PalTrade using ITC’s methodology for identifying potential target markets, and consultations with the enterprises of the FFVH sector. Bothshort term and medium to long term target market options
are assessed.

MARKET AND STRATEGICOPTIONSThe projected structural changes to the sector are basedon efficiency gains identified through the four gear analysis of the sector’s performance, and through the identification of opportunities for improving the sector’s capacity
to add, create, retain and distribute value.

As indicated in the introduction, the envisioned futurestate of the FFVH sector has been developed using a
combination of consultations, surveys and analyses. This
future state consists of two components :The proposed future state is presented in figure 10 below
through a future value chain, which captures both theselected key market and strategic options.

41

Traceability system

Add value by capitalizing on buyer
preference and requirements

Berzait University

Transportation services

Agricultural development Association (PARC)

Technical and maintenance services

Banks – Financial services

Loboatories – Quality testing

Accounting services

Organic Standards

Primary Supporting Services

Organic production and post-harvest
by farmer’s cooperatives

Organic production and post-harvest
by individual farmers

Production by farmer’s
cooperatives

Storage(WB and GS)
Distribution

MGT consultants, sholesale commissioner,business supporting agencies, municipalities

Palestinian packaging houses

Post harvest / packaging
houses

Production, post-harvestingand packaging by agro-companies

Distillation to produce
concentrates from herbs

Accredited laboratory

Organically certified inputs

Palestinian
Packaging
HousesProcessing Companies (dried, frozen,
preserved, juices and fruits)

Create value by developing
new products

Production and post-harvest
by farmer’s cooperatives

Production and post-harvest
by individual farmers

Setting up of waste recycling
to produce natural fertilizer
and fodder for animals

Create value by responding to buyer preferences

Fresh Fruits – Vegetables
and herbs from Gaza Strip

Fresh herbs for export

Farms: fresh fruits and vegetables
for fresh consuption+export

Farms: fresh fruits and vegetables
for processed foodInternational component

Retain value by reducing
dependency on imports

Inputs supplier (seeds, instruments,
technics, fertilizers, etc.)

Agrochemicals(Herbicides,
Fungicides,
Pesticides)

Labor office

Machinery
and tools

Seeds,
seeding

Fertilizers

Utilities, water, land,
electricity, fuelInputs usedby farmers

National component

LegendFUTURE VALUE CHAIN** Fresh herbs for export are morethan 17 varieties: thyme, chives,
chevil, arugula, sage, mint, parsley,flat parsley, lemon thyme, tarragon,savore, coriander, lemon balm, basil,
red basil, dill, marjoram, rosemary,oregano.

* Main vegetables exported to theIsraeli market: tomato, cucumber,squash, kidney beans, broad beans,pumpkins, cauliflower, cabbage,
potato, eggplvant, okra, lemon,orange, corn, fennel, turnip, onion,
garlic, grapes, hot pepper, bell
peppers, guava.

Logistics, storage,
refrigerated transportation

Local market –Gaza Strip

Exports

Local market

Agro-based
Industries

Institutions

HouseholdComsumption

Local consumers

Distributors

UAE

Distributors

RussiaRe-export

Italy

Re-export

JordanRetailtrade

WholesaletraderSupermarket

Traders

Retailcustomers

Dates

Dates
Fresh Herbs

Strawberries**
Vegetables

Dates**
Vegetables

Importingcompanies

TurkeyImportingcompanies

US

Importingcompanies

Netherlands

Importingcompanies

Gulf

EU

Gulf

EU

Retailnetwork

Distributors

RetailRetailRetailSupermarket

Retail shops

EU-Germany, Sweeden, Norway

Bell pepper,
herbs**,
tomatoes, dates

Capsicum,cherry tomatoes,
herbs**

Dates

Capsicum,vegetables,
herbs**

Vegetables*,fruits,herbs**

IsraelLeverage geographicaldistance, ongoingdevelopment support
and consumer preferences

Main market penetration

Leverage assistancereceived and increased
capacity of exporter

Leverage seasonality todiversify to this market

Leverage strong demandby setting up a local
retail presence

Leverage market penetrationand diversification throughthe ratification of mutual
recognition agreement

Leverage nicheand organic markets

Maintain market
penetration

Leverage market penetration
on specialized products
by developing offerings

42
THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

WHERE WE WANT TO GO

MARKETS IDENTIFICATION
The following analysis is divided into two broad phases :one related to the immediate, short term perspective andthe other related to the mid to long term outlook, by whichtime it is expected that a significant portion of the NES
and the FFVH sector PoA will have been implemented.
This phased approach is aimed at staging interventions
in alignment with the evolving capacities of the sector’s
trade support institutions and sector enterprises as the
NES implementation moves forward.
In the short term, cultural affinity, bilateral geographicaldistances, and existing trade relationships will form the

major criteria determining the markets for Palestinian
FFVH products. In the longer term, it is expected that theevolving capacities of Palestinian exporters – across multiple dimensions including quality management, supply capacities, product diversification, time to market efficiency,
and marketing/branding, in conjunction with the improving
business environment and export value chain improvements affected by the NES and sector PoA implementations – will allow exporters to target other markets in themedium to long term which seem hard to penetrate now.
Note: The products listed under the short term section
will also hold export potential in the medium to long term,
unless specifically mentioned.

FRUITS AND VEGETABLESSHORT-TERM PHASE ( 0-3 YEARS )Target market

Distribution
channel

Product

Palestinian
fresh fruit andvegetable exports
to market ( 2010 )Annual growthof sector
imports %( all suppliers )2007-2011

AnnualGDP growthestimates ( % )2013-2017average—

4

3.6

IsraelTomato, cucumber, squash,
kidney beans, broadbeans, pumpkin, cauliflower, cabbage, potato, eggplant, okra, lemon, orange,corn, fennel, turnip, onion,
garlic, grapes, hot peppers,
bell peppers, guava

Wholesalers,
distributors( selling to pointof sales / retailers )TurkeyDates ( HS 080410 )Wholesalers

147 000

22

4.1

Italy

Dates ( 080410 )Organic

116 000

9

0.6

Dates ( 080410 )Distributors /in country presence

174 000

40

3.5

Tomatoes ( 070200 )Distributors

3 000

20

Tomatoes ( 070200 )Distributors

243 000

3

Dates ( HS 080410 )Distributors

010*

Germany

Capsicum ( HS 070960 )Distributors

0

2*

1.2

SwedenCapsicum ( HS 070960 )Distributors

0

1*

2.1

NorwayCapsicum ( HS 070960 )Distributors

0

1*

2.2

United ArabEmirates

The
Netherlands

Source : ITC calculations based on COMTRADE data
Growth rate based on IMF estimates* 2008-2012

1.2

43

44

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Israel
Products : tomatoes, cucumbers, squash, kidney beans,broad beans, pumpkins, cauliflowers, cabbages, potatoes, eggplant, okra, lemons, oranges, corn, fennel, turnips, onion, garlic, grapes, hot peppers, bell peppers,
guavas.
The limited reach of Palestinian exporters has led toa heavy reliance on neighbouring Israeli markets inwhich the demand for Palestinian fresh produce is high.
Demand is especially high for products such as okra, cucumbers and pumpkins, which involve high labour costs
and are grown in low quantities in Israel. The year-onyear demand for both fresh fruits and vegetables ( fromall sources including the State of Palestine ) has been
growing since 2007 at a rate of 4 %.
Palestinian fresh produce exports to Israel receive a boost
every seven years when the crop fields in Israel lie fallow and cultivation of the land is prohibited. This in turnleads to higher than average imports from the State ofPalestine. This opportunity could be programmed to develop new varieties to serve this specific market.
Another form of consumption of Palestinian fresh produce
in Israel is converting produce into more value-added
products for export and consumption in domestic markets. For instance, Israeli pickle manufacturers provide
advance contracting to Palestinian fresh producers toassure supply of cucumbers and other vegetables fortheir factories.
The main market segments within the Israeli markets are
the wholesale and retail markets, targeted through wholesalers and distributors respectively.
While it is indeed necessary for Palestinian exporters todiversify in terms of target markets, the focus on Israel
will remain at least until the medium term. This focus will
be important to provide financial sustenance for sector
producers until the capacity of the sector and its accompanying infrastructure is improved to effectively target
other markets that are geographically more distant, withmuch tougher buyers’ requirements.

TurkeyProduct : dates
Geographical distance, ongoing development support
from Turkey and consumer preferences are the three key
reasons making the Turkish market a viable short-term
option for Palestinian fresh fruits producers. The bilateral
distance between Turkey and the State of Palestine isrelatively small, making it easier for Palestinian exporters to ship fresh produce. There is significant ongoingsupport and cooperation from Turkish cooperative unions
for building the productive capacity of Palestinian farmers. The support is primarily aimed at technology transfer( equipment ) and helping producers gain certifications.
Medjool dates are the main variety of dates grown in theState of Palestine and are popular among consumers in
Turkey. This variety is not grown in Turkey and thus there
is limited scope for a conflict of interest between Turkish
produce and imports from the State of Palestine. The
potential is further highlighted by consumption trends in
Turkey. Imports of dates in Turkey grew at a rate of 22 %between 2007 and 2011, and this directly correlates withthe significant growth rate of Medjool dates in the Stateof Palestine.
In the short term, it is unlikely that Palestinian exporters
will be able to directly approach retailers in Turkey, andthe main target segment will be wholesalers.

Italy
Product : dates
Imports of dates grew at a rate of 9 % between 2007 and2011, and demand is expected to grow in the near future.
There is a significant opportunity to target the niche organic market segment in Italy for Palestinian Medjool dates.
The current production structure in the State of Palestine
is well positioned towards producing organic produce,
including the pest-resistant date crop which is mostly
grown naturally in the absence of pesticides and other chemicals. Additionally, long-standing Italian support to the Palestinian agricultural sector has provided
Palestinian producers / exporters with a certain degree offamiliarity with the Italian market.

United Arab Emirates
Product : dates
Dubai is the Gulf’s centre of procurement for dates. The
demand for Medjool dates is increasing and they command a high price in the market, driven by the high purchasing power of the local population, expatriates, andother visitors to the city. In general, the demand for all
varieties of dates in the United Arab Emirates is high, increasing at a rate of 40 % between 2007 and 2011.
There is significant potential for Palestinian exporters
to sell directly to end consumers by setting up a local
retail presence, and procuring dates from the State ofPalestine. This model depends on the level of investment available to exporters, but the most common model is exporting the produce to distributors who take on

WHERE WE WANT TO GO

responsibility for marketing the product to retailers. This
market development effort could be linked to organizedpromotion efforts in the United Arab Emirates with otherkey priority sectors of the NES.
Product : tomatoes
The United Arab Emirates experiences a high demand
for tomatoes in the summer season, during which domestic production is significantly reduced owing to hightemperatures. In comparison, Palestinian agronomic andclimatic conditions allow for high production levels of tomatoes during the summer season. This is a comparativeadvantage for Palestinian producers which can be leveraged for export growth.

Product : dates
The State of Palestine does not currently export dates
to the Dutch market, and in this sense the introductionof Palestinian dates in the market will rely upon existing
business relationships. International / Dutch companies
and distributors are expected to be the main mode ofmarket entry in the short term.

Additionally, technical requirements for entering theUnited Arab Emirates market are relatively straightforward and not as complicated and strict as the European
Union and United Kingdom markets. In the short term, themost viable option for Palestinian tomato exports to theUnited Arab Emirates will be distributors / agents who will
be responsible for marketing the produce in the United
Arab Emirates to retailers.

The Netherlands
The Dutch government has provided longstanding support to the Palestinian agricultural sector, amounting toover €30 million spread over the last ten years. A significant amount of this assistance has been geared towards
developing the export competitiveness of the sector. As
a result of this support both Palestinian exporters andimporters in the Netherlands share a degree of familiarity with each other.
Product : tomatoes
The Netherlands is the largest consumer of Palestinian
tomatoes, importing US $ 243,000 worth in 2010. While
this level of exports may not be large relative to the performance of other countries, it is large enough by theState of Palestine’s standards and reflects the fact thatexporters have been able to achieve some success inthe Dutch market.
GLOBALGAP certified farms in the State of Palestine arein a good position to maintain supply consistency as wellas the required degree of quality. The agronomic conditions in the country allow producers to bring produce tomarket with a high degree of supply consistency between
November and May, which is the peak season of demandin The Netherlands.

Source: ©PalTrade.

Germany, Sweden and Norway
Product : capsicums
In the short term, there is high potential for marketing
capsicums to European Union countries, especially
Germany, Sweden and Norway, owing to the growing
demand for the product in winter ( November to April )and the supply consistency and availability in the Stateof Palestine during this period.
Similar to countries such as the Netherlands, there has
been close interaction between the Palestinian agricultural sector and development actors from these countries.
The resulting familiarity and assessment of the agriculture sector’s capabilities may have a positive bearing onexports from the State of Palestine. The technical entry
requirements, such as certifications, are not considered
to be a significant barrier in the short term, and certainly
not in the long term as capacity improvements across thevalue chain of the Palestinian agriculture sector continue.
The most viable market entry route in the short term
would involve contract marketing firms for distribution to
the wholesale markets and supermarkets.

45

46

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBSMEDIUM TO LONG TERM PHASE ( 3+ YEARS )Target market

Israel

Product

Distribution channel

Tomatoes, corn, eggplant corn, kidney beans,broad kidney beans, hot
peppers, bell peppers,
strawberries, carrots,
melons, watermelons,
grapes ( greater varieties ),garlic, onions

Wholesalers, distributors ( selling to pointof sales / retailers )Potatoes ( 070190 )Distributors

Dates ( 080410 )UnitedKingdom

The
Netherlands

Annual growthof sector
imports ( % )( all suppliers )2007-2011

AnnualGDP growthestimates ( % )2013-2017average

—

4

3.6

1.6

0

-4*

112 000

2*

Cucumbers ( 070700 )Wholesalers / contracting companies

0-2*

Grape molasses, grape
juice, dry grapes, grape
sheets, jams of grapes,
grape paste

Distributors( selling to retailers
and supermarkets )02*Strawberries ( 081010 )Distributors( selling to retailers
and supermarkets )420 000

2*

Strawberries ( 081010 )Distributors( selling to retailers
and supermarkets )206 000

20*

1.2

Grapes ( 080610 )Marketing agents /distributors sellingto wholesale markets
supermarkets

0

16*

3.5

Grapes ( 080610 )Marketing agents /distributors sellingto wholesale markets
supermarkets

0

12*

4

United ArabEmirates

JordanPalestinian
FFVH exports
to market( 2010 )Source : ITC calculations based on COMTRADE data
Growth rate based on IMF estimates* 2008-2012

Israel
Products : Strawberries, carrots, watermelons, grapes( greater varieties )Over the long term the positive impacts of proper agricultural planning – such as cultivating high value crops,
as well as more efficiently utilizing the diversity of climatic
zones – will start showing effect. From that point forward,
the capacity of the Palestinian agricultural sector is expected to grow to include the products listed above. Currently,
producers do not have the capacity to ensure supply
consistency for these products. Products such as cornpossess a comparative advance given that they are produced in the Jordan valley in two different seasons, thereby increasing availability of the product across the year.

United Kingdom
The United Kingdom market is one of the most challenging markets to enter because of strict quality-related
requirements and sophisticated standards to be applied along the value chain. These include, but are notWHERE WE WANT TO GO

limited to, GLOBALGAP, British Retail Consortium ( BRC ),and HACCP among others. The tolerance for chemical
residue in the final products is much lower than other
European Union markets. An added advantage of satisfying the technical requirements for the United Kingdom
market is that requirements for European Union ( andother ) markets are automatically satisfied.
Product : dates
Medjool dates grown for the United Kingdom should bepesticide-free to satisfy the requirements of the market.
In particular, the Jumbo Medjool and the Super Jumbo
Medjool varieties ( the largest and the second largest of
the three categories ) are popular among consumers in
the United Kingdom.
Product : capsicums
There is high potential to export medium sized capsicums, which are available in three varieties ( colours ) in
the State of Palestine. The demand for these varieties ishigh in the United Kingdom market, and offers potential
for Palestinian produce.
In terms of distribution channels, the wholesale market
is considered a viable option, although it is possible thatexporters may later develop the capacity to source directly to retailers. The wholesale market appears to be
the most feasible option. This route would use contract
marketing companies that would distribute the produce
to wholesale markets and supermarkets.
Product : potatoes
In the medium to long term, Palestinian exporters are
expected to develop the supply and quality consistency
required to enter the United Kingdom market for potatoes.
There is currently a tangible increase in demand for the
Maris Peer variety – which will be cultivated in the Stateof Palestine – in United Kingdom markets. GLOBALGAP
certified farms, certified through assistance from various
development actors, will play an important role in helping Palestinian producers and exporters develop export
competitiveness.
Products : grape molasses, grape juice, dry grapes, grape
sheets, grape jams, grape paste.
These products enjoy considerable popularity in United
Kingdom markets – among end consumers as well asprocessors – and in the process constitute a significant
opportunity for Palestinian exporters. When further processed, these products are developed into a variety of
products with high nutritional content. The comparativeadvantage for Palestinian produce lies in the non-chemical-based production process which is strongly positioned to meet the strict requirements of United Kingdom

markets. The distribution channel is expected to be distributors who will target the retail and supermarket market
segments.
Product : strawberries
Strawberry imports in the United Kingdom have been on
the rise, growing from US $ 147 million in 2010 to US $ 192
million in 2012. In 2010 the State of Palestine exported
US $ 420,000 worth of fresh strawberry produce to theUnited Kingdom.
The technical competencies for cultivating, harvesting,and post-harvest handling of strawberries are of a highdegree in both the West Bank and Gaza, and it is expected that United Kingdom technical requirements canbe met in the medium term if the current pace of developmental activity in the sector continues. Palestinian
exporters have managed to enter the United Kingdom
strawberries market in some instances, albeit with small
volumes. The distribution channel is expected to be distributors who will target the retail and supermarket market segments.

The Netherlands
Product : strawberries
The market for strawberries in the Netherlands is increasing : the country imported US $ 92 million of produce in2010 compared to US $ 125 million in 2012. As discussed
above, there is a high degree of technical competency
in the State of Palestine related to the cultivation andharvest, and post-production processes, for strawberries, which can be leveraged for exports. The distribution
channel is expected to be distributors who will target theretail and supermarket market segments.

JordanProduct : grapes
There are over 15 local varieties of grapes produced in
the State of Palestine. A key comparative advantage for
the Palestinian grape subsector is the ability to provide
the product for a significant portion of the year – from the
middle of May to early January.
Given the early production between May and June of
the high quality table grapes produced along the Jordan
valley, which are mostly cultivated under 50 mesh netting houses, in addition to the main traditional productionof grapes in the open fields in the south of the State ofPalestine, ( Hebron, Bethlehem ) which extends between
August and later January, this product has a high potential to respond to volume and quality requirement.

47

48

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Target market

Product

Distribution
channelPalestinian
herbs exports
to market( 2010 )Annual growthof sector
imports ( % )( all suppliers )2007-2011

AnnualGDP
growthestimates(%)
2013-2017average

Basil, mint, parsley, coriander,rosemary, dill, arugula, lemon
thyme, thyme, sage, chives

Israeli distributors
and exporters

n.a.

n.a

3.6

IsraelIsraeli distributors
and exporters

1 800 0002*

3

United States

Basil, rosemary, coriander, rosemary, dill, thyme, sage, arugula,chives, savory, tarragon, oregano,sage, marjoram
Basil, parsley, coriander, rosemary, lemon thyme, sage, chives,dill, thyme, chervil

United Kingdom
importers sellingto processors andpoint of sale locations

n.a.

n.a

1

n.a.

n.a

3.6

EuropeanUnion( including
the United
Kingdom )RussiaArugula, basil, mint, parsley, coriander, rosemary, chives, dill, savory, red basil, sorrel, lemon thyme

Source : ITC calculations based on COMTRADE data ; Growth rate based on IMF estimates* 2008-2012

The Jordanian market entry requirements are relatively
straightforward and within the reach of Palestinian exporters. The expected distribution channels are marketing
agents responsible for distribution to wholesale markets
and supermarkets.

United Arab Emirates

As in the case of the fruits and vegetables sector, Israel
remains the main market for Palestinian herbs in the shortterm. The main contributing factors for this are closeness,the lower cost of labour in the State of Palestine, the advantageous growing environment and the supply consistency of Palestinian herbs suppliers. There are currently
ten exporting companies in the State of Palestine that
supply the Israeli market. The main distribution channel
remains the Israeli distributors and exporters.

Product : grapes
The long list of varieties that are cultivated in the State ofPalestine make it more attainable for Palestinian producers to provide the United Arab Emirates as well as othercountries with distinguished and premium quality tablegrapes. Given that United Arab Emirates market entry
requirements are relatively flexible, this market is within
the reach of Palestinian exporters.

HERBS
SHORT-TERM PHASE ( 0-3 YEARS )Israel
Products : basil, mint, parsley, coriander, rosemary, dill,arugula, lemon thyme, thyme, sage, chives.

Herbs are utilized for both household consumption as
well as by processors, who in turn supply processed
herbs to the domestic and international markets. In thecase of the latter, Palestinian suppliers constitute a reliable source of fresh herbs and there is therefore consistent demand from Israeli processors.

The United States
Products: basil, rosemary, coriander, dill, thyme, sage, arugula, chives, savory, tarragon, oregano, sage, marjoram.
The United States market for herbs is currently experiencing an increase in demand for specific herbs including
rosemary, marjoram, coriander, chervil, thyme, dill andoregano. While Palestinian producers do not currently
have the capability to export directly to the United States,
they have been able to export to the market through Israeli
distributors and exporters, and through a certificate ofWHERE WE WANT TO GO

origin that specifically identifies the Palestinian origin of
the product.
Development support from the United States has directly
helped in building sustainable business models for herbs
in the West Bank. Palestinian herb producers have thecapacity to supply to United States markets within thequality and supply consistency requirements, and according to customer specifications. The main challenge
will lies in ensuring that exports are aligned with the strict
pest control policies of the United States market.

The European Union, including but not limited
to the United Kingdom
Products : basil, parsley, coriander, rosemary, lemon
thyme, sage, chives, dill, thyme, chervil.
As discussed earlier in the fruits and vegetables section, the United Kingdom market is one of the most challenging markets to enter thanks to strict quality-related
requirements and sophisticated standards to be appliedalong the value chain. These include, but are not limited to
GLOBALGAP, BRC, and HACCP among others. The tolerance for chemical residue in the final products is much
lower than other European Union markets. Additional buyer requirements include packaging : consumers in the
United Kingdom market prefer small bunches of herbs
which require delicate handling during the harvest andpost-harvest cycles. It holds that if Palestinian suppliers
are able to meet the United Kingdom market entry requirements, then they will be in a strong position to meet
quality and buyer requirements for many other markets,
including all of the European Union.

The growing supply capacity of Palestinian herb producers in the West Bank has significant bearing on supply
consistency for the United Kingdom market. The State ofPalestine possesses a considerable comparative advantage in this regard through its strong harvests between
November and May, which are also the main periods ofhigh demand in the United Kingdom.
There is high potential that, in the near future, Palestinian
producers will be able to meet the strict quality requirements of the United Kingdom market ( and consequently
other European Union markets ) due to significant development activity in the sector. This activity is focused on
integrating global best practices and standards such as
GLOBALGAP in the Palestinian agricultural sector.
In terms of distribution channels, it is likely that in the
short term Palestinian companies would be able to access distributors who would then sell to processors andat point of sale locations in the United Kingdom andacross the EU.

RussiaThe Russian market has been experiencing an increase indemand for herbs, especially for arugula, tarragon, lemon
grass, peppermint and parsley. Other herbs with high demand include sorrel, lemon thyme and lemon balm. The
buyers’ requirements in the Russian market are relatively
flexible when compared to European markets and offer ahigh degree of potential to Palestinian exporters.
In the short term, it is expected that the bulk of exports to
Russia will be routed through Israeli exporters and distributors, accompanied by a certificate of origin to identify
the export as of Palestinian origin.

MEDIUM-LONG TERM PHASE ( 3+ YEARS )Target market

Product

United ArabEmirates / Gulf
Cooperation
Council Markets

Arugula, basil, mint, parsley, coriander, rosemary, chives, dill,tarragon, sage, thyme

EU / United
Kingdom

Basil, parsley, coriander, rosemary, chives, dill, chervil, tarragon

Distribution
channelPalestinian
Annual growth
fresh fruitsof sector
and vegetable
imports ( % )exports to( all suppliers )market ( 2010 )2007-2011

Distributors ( registered company
or agent in theDubai )

Source : ITC calculations based on COMTRADE data. Growth rate based on IMF estimates*2008-2012** Data collected through bilateral consultations

Annual GDP
GrowthEstimates( % ) 20132017
average49

50

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

United Arab Emirates / Gulf Cooperation
Council Markets
Products : arugula, basil, mint, parsley, coriander, rosemary, chives, dill, tarragon, sage, thyme
The United Arab Emirates and Gulf Cooperation Council
markets are characterized by growing demand for luxury
foods, and the strong purchasing power of consumers.
There is high demand for herb products including arugula, sage, mint, thyme, tarragon, and basil.
Palestinian herb producers possess the capacity tosupply the United Arab Emirates and Gulf Cooperation
Council markets during the summer period when domestic supply runs low in those markets. Additionally, producers are well positioned to meet buyers’ requirements forthese markets, which are less stringent than for EU markets. The main distribution channel in these markets is
expected to be distributors who would market the productto retailers and other consumers.

EU / United Kingdom
Products : basil, parsley, coriander, rosemary, chives, dill,chervil, tarragon.

especially within the European Union and the UnitedStates. Certain Palestinian produce including dates,
almonds and herbs, including sage and thyme, are resistant to pests and constitute a natural offering in thisniche segment.
Moreover, multigenerational farming practices involving
non-chemical based fertilizers and pesticides, as well as
the perennial shortage of these chemicals in the State ofPalestine, have resulted in a natural competency amongproducers for catering to the organic sector. Organic
farming practices for the produce mentioned above isquite cost-effective in the State of Palestine due to thebasic nature of the inputs required.
Interventions at the policy level would include development of a standard that incentivizes producers who dedicate a certain minimum portion of their farms to organic
farming. A steering committee comprising governmental actors ( ministries and technical agencies ), the civilsociety network ( involving NGOs ), development actors( including international donor agencies ), and the private
sector as the ultimate beneficiaries, will need to be set
up to launch a nationwide drive to develop the organic
farming sector.
Interventions at the technical level would involve at least
the following :STRUCTURAL IMPROVEMENTS
TO THE VALUE CHAIN
DEVELOP TECHNICAL COMPETENCIESOF THE FFVH SECTOR TOWARDS THE NICHE
ORGANIC MARKET SEGMENT
The development of the FFVH sector’s niche organic
product offerings would significantly contribute to better positioning of Palestinian products in global markets, Mapping organic-ready producers in the State ofPalestine and segmenting producers based on theirreadiness levels ; Advocacy campaigns to raise awareness amongproducers on how to become certified organic FFVH
producers ; Assessment and development of traceability systems
across the State of Palestine for cooperatives as wellindividual companies ; and Field training and advisory sessions in the field withagronomists.

Box 9 : Overview of structural changes to the FFVH sector
 Develop technical competencies of the FFVH sector towards the niche organic market
segment
 Develop a new product line of natural oils extracted from Palestinian herbs
 Improve and creating linkages between the herbs sector and the agro-processing sector
 Improve the capacity of the FFVH sector to comply with international standards
 Link the FFVH and livestock feed value chains Improve inclusion of youth throughout the sector’s value chain through a variety of training
programmes developed through collaboration between companies and TVET institutions
 Increase the involvement of women workers in the FFVH sector value chain
 Develop agro-tourism initiatives

WHERE WE WANT TO GO

DEVELOP A NEW PRODUCT LINE OF NATURALOILS EXTRACTED FROM PALESTINIAN HERBS
There is potential to develop a product line of 16-20 typesof natural oils from Palestinian herbs, with promising prospects for local consumption as well as for exports. The
growth and the high annual yield of the herbs subsector 30 are significant comparative advantages that thePalestinian herbs industry enjoys and which could betranslated into competitive advantages in international
markets. Moreover, these products will constitute a highrevenue base for Palestinian exporters.
As an initial step, a pilot project to confirm the feasibility of
extracting oils through distillation ; linking areas of cultivation, packing houses and processing units; and exploring
domestic and international market segments / distribution
channels will be needed. As an added value creation
opportunity, the by-products ( waste ) from the distillation
process could be used for animal fodder as well as forcomposting purposes on agricultural land.

IMPROVE AND CREATING LINKAGESBETWEEN THE HERBS SECTOR AND
THE AGROPROCESSING SECTOR
The Palestinian herbs industry primarily caters to domestic and international consumers through sale of fresh
produce, and its capacity to process herbs is extremely
limited. The development of capabilities in herb and spiceprocessing would provide additional revenues for herb
and spice producers and exporters.
The high demand for mixed / processed herbs, especiallyza’atar, in Arab countries, may hold significant opportunities for Palestinian herb exporters. Additionally, the agroprocessing sector requires spice concentrates for foodpreparations, which could be catered for by Palestiniancooperatives.

IMPROVE THE CAPACITY OF THE FFVH
SECTOR TO COMPLY WITH INTERNATIONAL
STANDARDS
A key prerequisite for building export competitiveness in
the FFVH sector lies in the ability of enterprises to meet international standards. Global standards range from moderate ( Russia, Middle East ) to difficult ( United Kingdom ),and it will be important for Palestinian producers andexporters in the FFVH sector to be able to meet the mostdemanding requirements to ensure market diversification.
30. The approximate area of export-oriented herbs cultivation in

Palestine is 1,100-1,200 dunums, with an average yield of 3,000
kg of herbs per dunum. Conservative estimates of total yield areapproximately 3.3 million kgs annually.

Broad-ranging initiatives will be launched in order to develop and improve capacities of companies and cooperatives to commit to international voluntary standards
including BRC, HACCP, GLOBALGAP, Field to Fork,
SA8000, ISO 22000, SEDEX.
These initiatives will include, but not be restricted to : Assessments to identify the current level of complianceand key barriers that are preventing producers fromcommitting ; Pilot projects to support upgrading of facilities ; Improving quality management infrastructure within
enterprises ; Developing a strong traceability infrastructure acrossthe value chain ; and Technical field trainings related to best practices involved in cultivation and pre / post-harvest processes,
as well as support to the FFVH TVET infrastructure to
overhaul the curriculum.

LINK THE FFVH AND LIVESTOCK FEEDVALUE CHAINSAs discussed above, there is potential to use waste products resulting from herb processing activities as part oflivestock feed. These waste products have a high nutritional content that can help improve overall nutrition
to livestock.
An initial step would be a pilot project to explore integrated management between the FFVH and livestock value
chains and the resulting benefits. Additionally, appliedresearch would be conducted as part of the pilot projectto explore the correlation between increased use of waste
products in animal feed and the overall nutritional content
of the feed. Following the success of the pilot initiative,
the project would require mainstreaming through the development of partnerships between processors, research
institutions, and factories producing livestock feed.

IMPROVE INCLUSION OF YOUTH
THROUGHOUT THE SECTOR’S VALUECHAIN THROUGH A VARIETY OF TRAINING
PROGRAMMES DEVELOPED THROUGHCOLLABORATION BETWEEN COMPANIESAND TVET INSTITUTIONS
The inclusion of youth in the State of Palestine’s FFVH
sector was an important consideration throughout thestrategy development process. Private companies cancollaborate with universities and training institutions toestablish internship and apprenticeship programmes for
fresh graduates, as well as providing on-the-job training for young individuals already working in the sector.
Specific areas to focus on within the value chain would

51

52

THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

Source:Tomorrow's Youth Organization 2010.

include pre / post-harvest processes, as well as bestpractices involved in cultivation. The involvement of universities, agronomists and other experts, and local companies, would be essential.
The operational aspects of this proposal would involve
agreements signed between selected companies andmajor universities in the State of Palestine that have anagronomy major as part of the curriculum. Specialized
programmes ( shaped as internships, apprenticeships oron-the-job training programmes ) would be developedwith additional specialties including business administration, marketing, quality assurance, and so on. The programme would involve practical training sessions as wellas assessment through practical and theoretical exams.
Unless already employed, graduates would be provided
with placement guidance, as well as direct placement
opportunities through participating companies.
Priority would be given to develop specific programmes
tailored for the following lines of businesses :1. Grapes ( especially production and post-harvest )2. Potatoes
3. Capsicum
4. Dates
5. Fresh herbs ( especially production and post-harvest )6. Almonds
7. Open field production
8. Greenhouse production

INCREASE THE INVOLVEMENT OF WOMENWORKERS IN THE FFVH SECTOR VALUE CHAIN
Significant potential exists for increasing the inclusion of
women along the FFVH sector value chain, ranging frommanagement and marketing roles to more technical rolesin the cultivation and post-harvest stages of the value
chain. There are two important goals to be pursued :1. Encouraging increased employment levels for skilled
women workers within MSMEs in the FFVH sector in avariety of technical as well as management roles ; and2. Driving growth through improvements in quality management and supply consistency levels through theincreased involvement of women workers along thesector value chain.
On a technical level there is significant potential for women workers to add value in the post-harvest stage forherbs as well as high value fruits such as strawberry.
There is also considerable scope to increase inclusion of
women workers in the business development / marketingand management roles for the enterprises.
One of the key first steps will involve increased cooperation between key ministries ( such as the Ministryof Labour, the Ministry of Women Affairs, and Ministryof Agriculture ) and the Rural Women’s Development
Association. The RWDS is well positioned to represent
women in the agricultural workforce ( current and aspiring
workers ) and has the capacity to identify important areasof intervention and coordinate programmes.

Develop agro-tourism initiatives
Agro-tourism offers untested, yet high potential, opportunities to strengthen linkages between the FFVH andtourism sectors and contribute to economic and social development. The middle portion of the West Bank ( during
spring and summer ), and the Jordan Valley area ( during
winter ) have been identified as suitable locations where
pilot initiatives could be launched to test the concept.
Offered packages would include one-day and multi-day
guided trips for sampling natural / organic food offerings
as well as participating in agricultural activities at farms.

HOW WE GET THERE

HOW WE GET THERE
STRATEGIC OBJECTIVES
Four strategic objectives are considered necessary forrealization of the sector vision.

The first strategic objective is to enhance thesupply and quality management capacities
of FFVH producers to better respond to global
target market requirements.
This goal will be broadly achieved through operational
objectives and related activities aimed at encouraging
the adoption of good agricultural practices ; increasing
research and development in the sector ; improving producers’ business management practices ; ensuring effective quality management through the value chain ; andincreasing access to critical financial resources.

The second strategic objective is to strengthen
the business, legislative and regulatory
framework supporting the FFVH sector.
This goal will involve operational objectives and related
activities aimed at implementing enabling policies andlegislation for the FFVH sector, establishing marketing structures, and strengthening support services to the sector.

The third strategic objective is to increase
the sector’s coordination and organization toincrease its ability to operate in a challenging
global environment.
This goal will be reached through operational objectives
and related activities meant to strengthen transparency
and cooperation in the sector, and by building up cooperatives and associations in the sector.

The final strategic objective is to increase
the sector’s capacity and ability to enter andsustain export relationships in current andemerging markets.
This will be accomplished through operational objectives
and related activities targeting the better delivery of market information for enhanced market access ; improving
logistics for exports of FFVH ; strengthening the capacities of SMEs to enter leverage opportunities in target

markets ; and developing new, higher value agricultural
products for export.

IMPORTANCE OF COORDINATED IMPLEMENTATIONThe broad range of activities, together with the complex
nature of integrated intervention, requires careful implementation that efficiently directs resources and monitors
results at both the micro and macro levels. To this end, a
Palestinian Export Council (PEC ) will be established in order to facilitate the public-private partnership in elaborating, coordinating, and implementing the National Export
Strategy. In particular, the PEC will be tasked with coordinating the implementation of activities in order to optimize
the allocation of both resources and efforts across thewide spectrum of stakeholders. Within this framework,
implementation of the FFVH strategy also falls within thepurview of the PEC.
Such efforts will involve directing donor, private, and public sector organizations towards the various NES priorities
in order to avoid duplication and guarantee maximum
impact. Responsibilities will also include monitoring theresults of activities and outputs, while at the same time
recommending policies that could serve to enhance realization of the strategic objectives. With a 360 degreeview of progress the council will be best placed to manage funding and provide regular reports to donors andstakeholders. Moreover, the PEC will play a key role inrecommending revisions and updates to the strategy sothat it continues to evolve in alignment with the State ofPalestine’s changing needs.

IMPLEMENTATIONPARTNERS – LEADING ANDSUPPORTING INSTITUTIONS
A number of institutions will play a key role in the implementation of the plan of action for the FFVH sector, as
illustrated in the TSI section and the PoA. These are institutions that have the overall responsibility for successful
execution of the strategy, as well as support institutions
that are active partners but not leading institutions. Eachinstitution mandated to support the export developmentof the FFVH sector is clearly identified in the strategy
plan of action.

53

Source: © Fadi Arouri – Jericho & Jordan Valley

THE STATE OF PALESTINENATIONAL EXPORT STRATEGY

PLAN OF ACTIONPALESTINE

By Oncenawhile (Own work) [CC-BY-SA-3.0 ( http: //creativecommons.org / licenses / by-sa / 3.0)],
via Wikimedia Commons. Modified by: sputnix.es

3
2

2

3

1

2

3

1.1.1 Conduct technical gap analyses at the enterprise level to assess
problems related to agricultural practices.

1.1.2 Provide train-the-trainers trainings, through field schools and onsite
trainings, to agronomists and extension workers to increase adoption ofbest practices, with the main focus on site management enhancement andmaintaining quality along the value chain ( i.e. waste management, empty
chemical bottles, etc. ). Trainings to be differentiated by :»»Production ( GAP )»»Post-harvest ( GAP, GMP )Trainings to be categorized based on subsectors ( grapes, stone fruits,
dates, herbs )1.1.3 Improve post-harvest practices by improving the relationship between growers and packing house owners. This could be done by supporting open communications and transparent transactions between bothsides. The following are useful tools to enhance operations : packing houseto promote best post-harvest practices ; provide daily or weekly wholesale
prices based on grades and classes ; and support linking producers withservices providers.

1.1.4 Promote approaches for improving the efficiency of agricultural inputs such as :»»Land productivity ( soil fertility analysis and soil properties ),»»Fertilizer efficiency ( fertilizer optimization pilot programmes and experimental trials ),»»Water use efficiency ( computerized irrigation system ), and»»Training programmes to produce skilled labour ( selection of potentialtrainees in import expertise etc. ).

1.1.5 Design and disseminate case studies on GAP to identified farmers
and collectives in order to enhance knowledge of GAP.

1.1.6 Launch a media campaign ( TV, radio, newspapers, billboards,
schools, FFVH points of sale etc. ) to raise awareness of the importance of
GAP, and disseminate technical best practices.

1.1.7 Trained agronomists and extension services ( activity 1.1.2 ) to conduct regular job trainings and monitoring of GAP to increase overall knowledge and skill levels of farmers. This activity will focus initially on selected
pioneering farmers. Recommended fields of training are : soil fertility andsoil problems ; compost production and content quality improvement ; fertilization ; pest control and programme design ( i.e. integrated pest management ) ; natural enemies and utilization ; harvest practices.

1.1. Encourage
the adoption ofGood Agricultural
Practices ( GAP )and Good
Manufacturing
Practices ( GMP )Priority
1=low
2=medium
3=highActivities

Operational
objectives

VCH

VCH

VCH

VCH

Growers andbusinessowners

VCH

VCH

Beneficiaries

One hundred and twenty agronomists receive
training.

Launch three media
campaigns per year.

Twenty-five elaborated
and disseminated casestudies per year.

Fifteen thousand
dunums assessed.
Fifteen hundred
skilled labourers benefit from this activity.
Percentage of production per crop budget
comparison.

Thirteen hundred farmers and cooperatives
members benefit fromthis activity.

One hundred and twenty agronomists receive
training and
4 000 farmers get thebenefit.

Fifteen local enterprises are assessed.

Target measures

Certificates of trainees ortrainings attendance sheets

Three evaluation reports foreach campaign : before thestart, during implementation
and after implementation.

Evaluation report documents
the level of achievement.

Documented evaluation for
productivity per dunum.
Evaluation reports compare
results for current fertilization
programmes with new ones.
Training evaluation sheets aswell attendance sheets.

Evaluation report for operating packing houses

Training attendance sheets

Assessment reports

Means of verification

Company
for Organic
Agriculture
in Palestine( COAP )PalTrade

MOA

AAA

MoA

PARC

PalTrade

Leading
implementing
partners

MoNE, MoA, PSI,
PalTrade

PalTrade

PARC, ARIJ UAWC,
FAO

ARIJ, UAWC, MoA

MoL, PARC

An Najah National
University, Al-Quds
Open University
MoA, BESCO

MoNE, donors

Supporting implementing partners

500 000 700 000

500 000 1 000 000

50 000 100 000

500 000 1 500 000

100 000 200 000

250 000 500 000

40 000 80 000

Estimatedcosts US $56
THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

1.2. Support thesector with effective researchand development( R&D ) and bestpractices development

3

2

3

1.2.3 Organize exchange programmes between Palestinian MSMEs, producers, agronomists, technical staff, etc. with those of other countries toencourage best practices exchange ( potential internal exchange experience, e.g. from Hebron in the south - experienced in grape and stone fruit
production and processing - to the north )1.2.4 Assess comparative advantages of potential crop types and varieties
through a Policy Analysis Matrix and associated coefficients, mainly theDomestic Resource Coefficient.

1.2.5 Conduct a pilot study to assess the costs incurred by a selectedgroup of Palestinian farmers in terms of acquiring inputs such as waterand pesticides. After these costs have been identified and analysed ( as abenchmark ), train farmers and enterprises to lower and control costs.

3

3

1.1.12 Establish Memoranda of Understanding between producing enterprises and accredited labs to ensure regular soil, water, and final productresidues testing for FFVH produced commercially. Results to encourage best practices, improve produce reputation and provide guidance on
chemical use in production processes.

1.2.2 Apply pilot demonstration trials ( field experiments ) to new varieties,
new crops and new production technologies

3

1.1.11 Develop a comprehensive awareness-raising campaign involvingcase study dissemination and field training on ideal production structuresand specifications.

22

1.1.10 Launch an annual programme to identify best-in-class producers
through a GAP panel.

1.2.1 Encourage R&D activities related to : pest control ; post-harvest management ; and quality management of FFVH products up to the consumer level. Disseminate results through trials and demonstrations to theAgricultural associations ( AAA, ACU, etc. ).

3

1.1.9 Encourage the development of Information management systems( paper or electronic ) within enterprises in order to build accumulated
knowledge based on past data, as well develop documentation practices and systems.

1.2. Support thesector with effective researchand development( R&D ) and bestpractices development2

1.1.8 GAP trainings and awareness-raising campaigns aimed directly at
farmers and business owners to address water management practices andenvironmental risks / degradation.

1.1. Encourage
the adoption ofGood Agricultural
Practices ( GAP )and Good
Manufacturing
Practices ( GMP )Priority
1=low
2=medium
3=highActivities

Operational
objectives

Management
level

VCH

VCH

VCH

VCH

VCH

Enterprises

VCH

VCH

VCH

Beneficiaries

Four pilot studies foreach product list.

Three comparative advantage assessments
are conducted.

Twenty internal exchange visits per year.
Twenty external exchange visits per year.

Five pilot demonstrations per year.

Conduct 10 researchstudies on the different topics.

Ten memoranda of understanding signed between accredited labs
and FFVH producing
companies.

Three comprehensive
awareness campaigns.

Three annual ceremonies reward the ten
best-in-class farmers.

Ten MSMEs, including
cooperatives, benefit.

Sixty trainees, bothbusiness owners andstaff.
Another 3 000 benefit
directly and indirectlyfrom the campaign.

Target measures

Published results per study
as well as attendance sheets
for the trainees

Published reports for the assessments and validation of
the results

Evaluation report per exchange visit

Evaluation report for eachdemonstration

Published R&D results for thecooperatives or for the public

Reports document the enhanced performance of farming processes and the qualityof the final produce

Evaluation report for eachcampaign

List of rewarded farmers
and documentary of success story

Evaluation reports from thisactivity and feedback from
the MSMEs

Certificates issued by an accredited certification body

Means of verification

ARIJ

MAS

PalTrade

AAA

ARIJ

MoA, MoH

PalTrade

MoA

ICT

PSI

Leading
implementing
partners

An Najah National
University, Al-Quds
University

MoA, PARC, AAA,
ARIJ, ESDC, UAWC

Donors, PARC,
AAA, MoA

MoA, MoNE, PSI,
PARC

PARC, MoA, An
Najah National
University, ACU,
PFU

Local laboratories,
MoNE

MoNE, MoA,
Solutions For
Development
Consulting Co.

Local NGOs, AAA,
COAP, PSI

MoA, MoNE

MoNE, MoH, PFU

Supporting implementing partners

20 000 80 000

100 000 300 000

150 000 200 000

100 000 150 000

100 000 300 000

400 000 600 000

100 000 800 000

50 000 150 000

500 000 1 300 000

200 000 400 000

Estimatedcosts US $PLAN OF ACTION
57

3

3

1.4.2 Promote rehabilitation and maintenance of GAP and GMP through increased monitoring and maintenance of processing facilities to eliminate
pest development. Recommended areas of intervention are : final productstorage areas ; reception areas ; machinery ; raw materials stores ; handlingareas in packing houses ; workers’ rooms ; and service areas. Use the principle of elimination of breeding environments. Assessment will include
compliance and actions taken to cover the assessed fields as well as an
upgrading plan for each cooperative, company, or processing facility.

1.4.3 Develop and create a quality-sensitive pricing mechanism ( grading
system ) through different approaches :»»Establishing a daily mechanism for pricing according to quality grades
and updating the list of prices. Prices should be listed per kg instead of
the current mechanism of pricing in bulk per box.
»»Maintaining a developed recording and operating system in the local
market.
»»Wholesale market reorganization for the adoption of pricing and grading systems ; use lobbying and advocacy as well as cooperation with local municipalities.

3

1.3.4 Support the development and maintenance of internal management
systems and practices for cooperatives and enterprises.

3

2

1.3.3 Conduct refreshment trainings for enterprises, both on-site and theoretical training, to encourage better management and maintain competency.

1.4.1 Conduct an awareness-raising campaign for enterprises on international standards ( voluntary standards such as GLOBALGAP, HACCP, BRC,
Field to Fork, SEDEX SA8000, etc. ), enterprise levels, and cooperatives.

3

1.3.2 Implement business planning and cost / benefits trainings for small
and medium-sized business owners in the FFVH sector. Farmers shouldbe trained in proper record keeping of their farm history to enhance theirfinancial standing should they ever apply for loans.

1.4. Ensure effective quality management
throughout thesector2

1.3.1 Conduct business management assessments of companies, cooperatives and producers to confirm cost-effective and better planning practices.

1.3. Improvebusiness management practices

Priority
1=low
2=medium
3=highActivities

Operational
objectives

VCH

VCH

Across VC

Agronomists
and businessownersCooperatives
companies

Management
staff

Local enterprises

Beneficiaries

One valid quality-sensitive pricing mechanism has beendeveloped by the thirdyear.

Rehabilitation of two
packing houses or facilities per year.

Current number of local enterprises that
hold these certificatesor some of them.
Two awareness-raising
campaigns conducted
per year.

Three cooperatives
and / or enterprises receive support annually.

Three trainings per
year.

Five trainings conducted per year.

One assessment isconducted per year.

Target measures

Evaluation report for themechanism

Evaluation report reflects results for the rehabilitatedprocessing facilities, and thenumber of certified facilities
up to an international global
standard like BRC

Evaluation reports for eachcampaign

Evaluation reports for the new
Internal management systems are drafted, as well as
HR manuals

List of trainees who attended and evaluation sheets foreach session

Attendance sheets for the
trainees as well as evaluationof training sessions

Reports of the assessment
are published

Means of verification

PSI

PalTrade

PSI

AAA

PalTrade

PARC

PalTrade

Leading
implementing
partners

MoL, CPC, MoA,
PalTrade

PFU, ACU, COAP,
BESCO

PalTrade, MoNE,
MoA

MoA, international
donors

ABP / individual
banks

MoNE, PBF, PIPA,
PalTrade

ARIJ, Al Sahel
Consultancy,
Solutions
Consultancy

Supporting implementing partners

400 000 1 200 000

100 000 200 000

50 000 300 000

100 000 250 000

30 000 120 000

50 000 150 000

50 000 500 000

Estimatedcosts US $58
THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

2

2

3

2

1.4.7 Lobby for mandatory compliance with existing technical regulations
and standards through advocacy campaigns ( health, food safety and minimum requirements for trading ).

1.4.8 Conduct workshops to promote application and enforcement of technical regulations and standards systems.

1.4.9 Establish a training programme to certify auditors in the State ofPalestine in HACCP, ISO2000, BRC SA8000, etc. to accelerate the processof higher standardization.

1.4.10 Improve compliance levels of imported and exported products
through a strengthening of quality controls by PSI.

2

1

1.4.6 Harmonize local and international quality requirements for FFVH
to build up quality management of FFVH enterprises across the State ofPalestine by reviewing standards and conducting monitoring at production and distribution levels. Once the system is reinforced conduct sector
workshops at the national level to disseminate procedures and requirements.

1.5.1 Promote collective purchasing through collective procurement( pooled resources ) to buy inputs, acquire agricultural loans, and support
formalization of buying and selling terms ( commercial contracting, etc. )3

1.4.5 Support Palestinian certification bodies to be accredited as certifiersof GLOBALGAP and BRC and design a three year plan to build the capacityof COAP to conduct business on its own.

1.5. Develop innovative mechanisms to increasefinancial accessfor FFVH production

3

1.4.4 Develop and apply traceability to the FFVH sector, starting with asmall number of producing enterprises exporting fresh produce and then
expanding the system. Traceability to cover inputs, production and distribution.

1.4. Ensure effective quality management
throughout thesectorPriority
1=low
2=medium
3=highActivities

Operational
objectives

VCH

Across VC

VCH

VCH

Growers

All the VCH,
mainly producers

COAP cooperatives

Across VC

Beneficiaries

Six FFVH cooperatives
and groups of farmers
fully apply collective
purchasing.

Compliance levels are
improved by 30 % forboth imported and exported FFVH.

Six new auditors certified in international
voluntary standards.

Three workshops per
year conducted to promote application enforcement.

Two campaigns per
year are launched forthis purpose.

Thirty quality standards
reviewed per year andinitiation of more harmonized standards for
fresh produce.

Get accreditation
for GAP and BRC fora minimum of one
Palestinian certification body.

Development and application of a national traceability system
for fresh produce in theState of Palestine.

Target measures

Evaluation reports for thesavings and / or net profits
achieved through this activity ( collective purchase orders and invoice payment
requests )Reports from the MoA andMoH on exports and imports show listed productsthat have been rejected fromentering the country due tonon-compliance with local
quality standards

List of accredited certified
auditors with their certificates attached

Attendance sheets of participants and deliverables thatcame out of the workshops

Evaluation reports for eachcampaign

Drafting of harmonised quality requirements

Certificate / s of Accreditation
for a Palestinian certificationbody has / have been issued

Evaluation report for the
traceability system / s

Means of verification

REEF

MoH

PSI

PSI

ConsumerProtection
Committee

PSI

PARC

PSI

Leading
implementing
partners

UAWC, ACAD, ACU

PSI, MoNE, MoA

MoH, An Najah
National University,
MAK

UNIOS associations, MoNE

PSI, MoH
National Media TV

MoA, AAA, PARC,
agricultural faculties, ARIJ

PS, MoA

MoA, MoH, MoNE

Supporting implementing partners

70 000 270 000

500 000 600 000

100 000 200 000

60 000 100 000

30 000 80 000

50 000 100 000

50 000 150 000

200 000 300 000

Estimatedcosts US $PLAN OF ACTION
59

2

2

1.6.2 Support women’s involvement in the fresh produce production process, mainly in the herbs subsector.

3

1.5.4 Lobby to enhance the efficiency of reimbursements ( VAT refunds )and allow new payment options.

1.6.1 Support youth involvement in the production process, mainly inpost-harvest activities.

3

1.5.3 Establish specific government-funded agricultural credit lines, oreven an agricultural development bank, aimed at providing preferential
loans and credit to organized enterprises or cooperatives.

1.6. Promote involvement inagricultural production and processing

3

1.5.2 Establish an agricultural insurance scheme in association with
Palestinian insurance companies and the government. This is to be supported by an agricultural insurance law.

1.5. Develop innovative mechanisms to increasefinancial accessfor FFVH production

Priority
1=low
2=medium
3=highActivities

Operational
objectives

VCH

VCH

VCH

VCH

VCH

Beneficiaries

Thirty women involvedin fresh produce processing.

Achieve 20 % growth
per year in youth involved in agriculturalactivities.

Achieve 33 % enhanced efficiency of reimbursements ( VAT
refunds ) per year to become 100 % by the endof the third year.

Twenty successful agricultural loans per
year, either throughan Agricultural Bankor ACL.

One pilot agricultural insurance scheme
serves about 2 000
farmers, individuals
and cooperative members.

Target measures

Evaluation report for FFVH
enterprises with regard to
women’s involvement in the
agricultural sector

Evaluation report for youth
involvement in agriculturalactivities and new businesses owned and managed byyouth ( new agronomists )Evaluation reports for actual
reimbursed VAT funds

Evaluation reports for agricultural loans statutes andprogress in establishing an
Agricultural Bank.
List of business deals that result from these credit lines.

Drafting the new insurance
law, then a list of cooperatives, individuals and companies that have benefited fromagricultural insurance

Means of verification

MoWA

MoL

PFU

MoA

Palestinian
Insurance
Federation

Leading
implementing
partners

RWDS, AAA

Local youth organizations , youth
clubs, MoNE

ACU, MoA, MoF

PIBA, PMA, INB,
ACAD, REEF

Parliament, MoA
ACU, PalestinianFresh Produce
Council

Supporting implementing partners

100 000 400 000

150 000 250 000

66 000 100 000

10 000 000 20 000 000

1 000 000 2 000 000

Estimatedcosts US $60
THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

2.3 Enhanceand develop trade support services( transport,
cold chains,and packaging )32

2.3.1 Promote the establishment of specialized agricultural FFVH logistics and transportation companies through a
support and incentive structure for these enterprises to startand grow operations.

2.3.2 Promote establishment of decentralized trade support
services ( bodies ) and empower available ones. ( I.e. support
rehabilitation and accreditation of decentralized MoH labs
and build their capacity to collect samples. )2

2.2.2 Implement pilot export business models ( marketingcompanies, bulk exports, financial pooling, etc. ) to build
market linkages and enhance practical knowledge of companies.

2

2.1.4 Create a policy / plan to control and monitor how support is provided to producers. Support should be basedon capacity to comply with quality standards ( tested ), andbusiness management.
23

2.1.3 Develop an organic agriculture legislative framework
confirming organic inputs required for production and processing, and making the effort to confirm availability ofthese essential inputs.

2.2.1 Continue the establishment and rehabilitation of softand hard infrastructure through encouraging / promoting investments.

2

2.1.2 Enhance existing laws, bylaws, organizational procedures and regulations related to FFVH exportation to be harmonized with international regulations and to make themmore flexible to fit with global requirements.

2.2. Establish
management
and marketing structures
to support
the sector’s
growth2

2.1.1 Assess current economic and social policies related to FFVH to define enabling and disabling ones. Based on
this assessment, advocate for redrafting the disabling ones
based on the needs of the private sector.

2.1 Confirm
and apply enabling policies
and legislation
to effectively support the
FFVH Sector

Priority
1=low
2=medium
3=highActivities

Operational
objective

VCH

Across VC

Producers
mainly, but also
later in the VC

VCH

VCA

VCH

VCH

Across VC

Beneficiaries

Two bodies receive the support of decentralized laboratories.

Have new specialized FFVH
ISO, BRC, and HACCP certified logistics companies( or one company with four
branches ) founded to serve
the sector in a strong position for export.

Five pilot business models
must be implemented within three years.

Ten new established infrastructure projects as well as
rehabilitation projects.

Develop a manual which reflects the main selection
criteria that must be considered to provide support
to MSMEs.

Develop a formal organic agriculture legislative
framework.

Ten enhanced laws, bylaws
and organizational procedures related to FFVH exportation.

Redraft ten disabling social and economic policies
as well formulating ten new
enabling policies.

Target measures

Evaluation results for the
newly established support
services bodies, and progress reports

Registration certificates ofthe four logistics companies
or one company with four
branches ( north ,south middle ( WB ) and GS )List of implemented projects and quarterly evaluation reports on status andprogress

Progress reports and / orevaluation documents forthe projects

Draft of defined policy is
published after being tested and having assumptions
validated

Published organic agriculture legislative framework

First an assessment reportfor regulations and organizational procedures related
to FFVH exportation, thendrafts of new laws and bylaws that are harmonizedwith global requirements

Drafts of new enabling policies

Means of verification

PalTrade

PIPA

PalTrade

PIPA

PSI

MoA

Agricultural unions

Lawyers association, associations ofdifferent VC stakeholders

Leading
implementing partners

Strategic Objective 2 : To strengthen the business, legislative and regulatory frameworks supporting the FFVH sector

PCBS, MoA, MoNE,
PSI, PSC

PSI, MoA, PalTrade,
MoNE, private companies

MoNE, private exporting companies, donors

MoNE, PSI, MoA, private sector

MoH, MoNE ,MoA,
PARC

PSI, PARC, COAP, AAA,
ARIJ

Donors, PSI, MoNE,
federations and cooperatives, as well as local NGOs

MoNE, MoL, MoA,
SCC, or other international donors

Supporting implementing partners

40 000 50 000

30 000 50 000

500 000 700 000

1 000 000 1 200 000

500 000 1 500 000

50 000 80 000

30 000 50 000

10 000 50 000

Estimated
costs

PLAN OF ACTION
61

1

3

3.2.3 Review and modernize the legal framework for cooperatives
and associations to ensure these groups are required to provide
regular financial and governance reports as a means of increasingtransparency and efficiency.

3.2.4 Elaborate the best practices monitoring and dissemination
framework to highlight successful business models of cooperatives and associations, especially those related to cooperative investments.

2

3.1.6 Develop, disseminate and enforce a code of ethics for sector stakeholders.

23

3.1.5 Promote contractual business transactions as a way to contribute to solving liquidity issues for small producers and facilitating the business of exporting companies though forward planningin terms of varieties of produce and quantities, etc.

3.2.2 Ensure regular monitoring of cooperatives and associations
to ensure efficient and transparent governance. This could be a key
framework to secure financial lending to these associations.

3

3.1.4 Improve transparency between stakeholders through the development of legislative and monitoring frameworks to support thecontractual arrangements mandatory for dealing in commercial
quantities, mainly in the wholesale market.

2

2

3.1.3 Promote a specialized council composed of FFVH VC stakeholders in order to increase private-public dialogue and collaboration in the sector, and for its development.

3.2.1 Develop a good governance manual for cooperatives andother key cooperation investments, and conduct multilevel trainings about the benefits of good governance.

2

3.1.2 Organise regular business to business meetings, conferences and workshops to build trust between the produce owners, key
actors, and retailers or exporters, to ease better business performance and bridge the gap between different arms of the commercial process. Regular meetings based on the seasons ; producers
meeting together to enhance proper planning.

3.2 Strengthen
cooperatives
and associations operatingin the sector

3

3.1.1 Conduct awareness-raising campaigns to VC actors to enhance cooperation and organization of service provision as a mean
to professionalize the VC and increase supply consistency.

3.1.
Strengthentransparency and cooperation

Priority
1=low
2=medium
3=highActivities

Operational
objective

Growers andbusinessownersCooperatives
sectorCooperatives
sectorVCH

Across VC

Growers andbusinessownersGrowers andbusinessowners

VCH

VCH

VCH

Beneficiaries

Highlight three successful business models per year belonging
to cooperatives.

Full revision of the legal framework for efficiency and transparency of cooperatives.

Twenty cooperatives and associations are regularly monitored
per year.

A good governance manual isdeveloped and 20 trainings conducted to develop and explain
the manual.

Development of a code of ethics
for FFVH exporting or producing
parties, addressing values andcriteria of business.

Promote 20 business transactions per year. Number of business based on pre contracts

Establishment of a new monitoring framework for the wholesale market.

Establishment of a strong FFVH
Council to increase private-public dialogue.

Two workshops and 20 B2B
meetings conducted per year.

Three awareness-raising campaigns aimed at professional cooperation between key actors.

Target measures

Published manual of elaborated best practices
and documentation of
successful businesses

Draft of the new the legal
framework

Monthly or quarterly evaluation reports

Good governance manual is published –trainings attendance sheets areavailable.

Draft of the code of ethics
is published

Evaluation of business
transactions and sustainability assessment reports

Evaluation reports and / orsigned contracts

Formal authorization andregistration of the FFVH
Council

Copies of contracts
signed, if any, as a resultof B2B, and attendance
sheets of meetings andworkshops

Evaluation reports before
and after launching eachcampaign

Means of verification

AAA

MoL

MoL

MoL

PSI

Fresh Produce
Council

Agricultural and industrial Chambersof Commerce

MoA

PalTrade

PalTrade

Leading
implementing
partners

Strategic Objective 3 : Increase the sector’s coordination and organisation to increase its ability to operate in a challenging global environment

MoL, SCC

MoA, PARC, ACU,

MoA, MoNE

MoL, MoA

MoL, MoA, PARC

PARC, MoL, MoA

MoNE, SCC, MoA,
PARC

MoNE, PARC, local
NGOs, private sector, cooperatives,and unions

MoL, MoA, MoNE

MoL, MoA, MoNE

Supporting implementing partners

50 000 70 000

50 000 60 000

100 000-150-000

100 000 120 000

50 000 80 000

1 000 000

120 000 130 000

200 000 300 000

220 000 300 000

100 000

Estimatedcosts

62
THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

2

3

1

2

3

2

3

2

4.1.1 Complete export readiness assessments of FFVH enterprises. Define level of readiness : potential, emerging, and active.

4.1.2 Based on export readiness assessments, train enterprises on how to prepare for market development and participationin trade fairs :»»Preparing promotional materials in the language and culture of
the host country»»Presentation and visibility»»Managing supply and demand»»Identifying and targeting potential buyers

4.1.3 For ready enterprises, assist participation in international trade fairs.

4.1.4 Develop and maintain a database providing valid and updated information on market requirements and buyers’ requirements
to enhance exporters’ performance.

4.1.5 Organize B2B meetings with international clients to encourage potential international business.

4.1.6 Establish a temporary distributor hub for Palestinian FFVH
products abroad in order to achieve maximum exposure in different potential markets.

4.1.7 Ensure regular and updated market information about the
FFVH sector is available through a website or magazine ; ensure
this source of information can be trusted.

4.1.8 Complete a regular full market study ( fee-based or partly fee-based ) for the FFVH sector to structure market segment
identification ( current, growing and emerging ).

4.1 Enhanceaccess to target markets
through better
market knowledge and visibility

Priority
1=low
2=medium
3=high

VCH

Producers andexporters

VCH

Decision makers

Exporting companies

Producers, exporters, all the
VCH

Exporting
MSMEs

Local exporting
enterprises

Beneficiaries

Conduct a full study thatcovers the sector ( founding a steering committee tohandle it ).

Officially launch a website
and monthly newsletter.

Establish three distributor hubs.

Conduct three B2B meetingsoutside the country.

Develop a database providing market and buyers’ requirements that could serve
20 MSMEs with updated andvalid data.

Three FFVH MSMEs per year
assisted to participate in international trade fairs.

Ten FFVH MSMEs and cooperatives benefit from training
and promotional materials
as well as trained personnel.

Ten FFVH enterprises are
fully assessed and their levelof readiness defined.

Target measures

Report of the study

Having the website functioning, and regular
evaluation reports andfeedback from the clients

Evaluation reports andthe progress of commercial business for FFVH exporters.

Evaluation report for theB2B meetings and follow
up procedures

Publishing the databaseon a formal, accessible
website and collecting
feedback by regular evaluation reports from eachparticipating MSME

Pre- and post-performance evaluation resultsfor each participant company, documented evaluations, andlessons learned reflecting
on product development

Evaluation questionnaire
for the MSMEs, attendance sheets and comparison documents for the
beneficiaries before andafter trainings

List of beneficiary companies

Means of verification

PalTrade

PalTrade

PalTrade

PalTrade

PalTrade

PalTrade,

PalTrade

PalTrade

Leading
implementing
partners

Strategic Objective 4 : Increase the sector’s capacity and its ability to enter and sustain export relationships in current and emerging markets

Activities

Operational
objective

Unions, private
sector

MoNE, Unions

Donor funding
USDA. SIDA

Unions, MoA,

MoNE, donors

Private sector

MSMEs

Supporting implementing partners

1 000 000 –1 200 000

100 000 –125 000

1 000 000 –1 200 000

70 000 90 000

100 000 –120 000

120 000 –140 000

50 000 –150 000

30 000 60 000

Estimated
costs

PLAN OF ACTION
63

1

2

2

2

4.3.1 Design case studies and promote successful business andexport models of the FFVH sector on one website and monthly newspaper.

4.3.2 Increase marketing capabilities of SMEs in the FFVH sector
through conducting advanced trainings on best practices in marketing, developing CRM systems, and applying case studies andpractical examples, etc.

4.3.3 Support branding and promotion efforts of Palestinian
FFVH by getting external experience to design and implement a
branding campaign.

4.3.4 Promote marketing and exporting to cooperatives to develop small and medium producers.

3

4.2.2 Organize structured dialogue between FFVH operators andlogistics companies ( national and international ) to enhance logistics companies’ and their technical staffs’ management of
perishable products ( special technical treatments and constantmonitoring ).

4.3 Develop
small and medium FFVH
producers’ capabilities totake advantage
of better business opportunities in the
global market

2

4.2.1 Develop mechanisms to get better information flow about
trade and logistics information ( national and international ) suchas monthly logistics prices and basic knowhow to compare various prices for the same services.

4.2. Enhancelogistics information andpotential alternatives for efficient export.

Priority
1=low
2=medium
3=highActivities

Operational
objective

VCH

VCH

VCH

Across VC

VCH

Beneficiaries

Have six cooperatives
and / or joint ventures develop their FFVH market shareespecially for export.

Have three new brands developed annually for FFVH
products through cooperation with international expertise.

Conduct six specialized
trainings per year, aiming tobenefit 90 marketing officers / managers.

Serve the FFVH sector bydesigning and promoting ten
case studies per year.

Provide 10 FFVH MSMEs
with this service.

Develop a mechanism to getbetter trade logistics information flow which will contribute to increasing themarket share of five exporting companies.

Target measures

List of cooperatives exporting FFVH directly to
the global market, as percertificates of origin andauthorized paperwork( packing lists, commercial invoices, etc. )Published branding books
for each company contributing to this activity

Training attendance
sheets and evaluation
sheets for the trainings

Recorded case studies

Evaluation reports on theservices provided to exporting companies

Regular reporting fromMSMEs and evaluation
reports on the services
provided

Means of verification

PARC

PalTrade

PalTrade

PalTrade

PSC

PSC

Leading
implementing
partners

Strategic Objective 4 : Increase the sector’s capacity and its ability to enter and sustain export relationships in current and emerging markets

MoA, PalTrade

SCC, Unions, associations, international marketingcompanies

PBF

PFU, MoNE, MoA

PalTrade, MoNE

PalTrade

Supporting implementing partners

100 000 –150 000

1 000 000 –1 200 000

200 000 –220 000

50 000 –80 000100 000 –130 000

300 000 –400 000

Estimatedcosts

64
THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBS

3

3

3

4.4.1 Support the development of organic producers by :»»Developing guidelines for organic agriculture ;»»Offering information about how to diversify their organic products, and providing them with valid information about viable
produce in demand in international markets ;»»Developing the marketability, both internal and external, of organic products ;»»Aligning programmes supporting natural preservation and production with organic enterprises ;»»Supporting producers with relevant information about : pest
control ; a weekly recording and tracking system applied at thefarm level ; and market prices for organic fresh produce ; and»»Assessing the potential for processing fresh organic produce
for national or international markets.

4.4.2 Use information in a number of studies already design
about high value cash crops ( blueberries, kiwi fruit, berries, cut
flowers, sumac, etc. ) to conduct a comparative advantage assessment and define development plans for the production andviable export development of selected crops.

4.4.3 Conduct national level awareness-raising campaigns forfarmers about high value crops and how to expand production
according to the results of crop assessments and the results ofpilot tests.

4.4 Develop
new high value agricultural products forexports

Priority
1=low
2=medium
3=highActivities

Operational
objective

VCH

VCH

VCH

Beneficiaries

Conduct two national level awareness-raising campaigns. Number of people
who benefit directly and indirectly by the campaigns.

Target two cooperatives with
100 dunums each to develop
plans for the production andviable export development of
selected crops.

Develop a Palestinian organic farming protocol.
Support five MSMEs, including cooperatives, to increase their share of organic
products.
Support tripling the numberof organic certified FFVH
producers.
Support 800 producers withaligning programmes supporting natural preservationand production with organic
enterprises.
Support 100 producers with
relevant information on pest
control and recording andtracking systems.
Conduct three studies : oneon the potential for processing fresh organic produce
locally, and two on the global market.

Target measures

Evaluation reports foreach campaign and its effect on farmers’ performance ; conduct pre andpost evaluation for eachcampaign

Progress reports and regular evaluations for eachproject and a list of products

Have the Palestinian organic farming protocol
published and authorized
formally
List of FFVH certified organic products
Produce a report on the
study of the marketabilityof organic FFVH internallyand externally
Training materials andsigned attendance sheetsof the trainees
Have assessment reportson the potential for processing organic fresh
produce for local and international markets

Means of verification

PalTrade

PARC

PARC

Leading
implementing
partners

Strategic Objective 4 : Increase the sector’s capacity and its ability to enter and sustain export relationships in current and emerging markets

MoA ( extension
services )GrapesCouncil / MoA

ARIJ, MoA

Supporting implementing partners

40 000 –120 000

50 000 –200 000

1 000 000 –1 500 000

Estimated
costs

PLAN OF ACTION
65

3

1

2

3

4.5.1 Support initiation of new direct market linkages with newcustomers in potential markets based on higher potentiality andexpected business opportunities.

4.5.2 Promote market development initiatives that mainly focus
on building Palestinian FFVH MSMEs’ capacities to meet market
requirements as well as to promote the market-driven approachto producers.

4.5.3 Support developing fresh exports for current global customers through making in-demand products available to desired
buyer requirements.

4.5.4 Support activities to develop new product varieties basedon growing international demand for certain agricultural products
such as sumac, carob, kiwi fruit, and Maris Peer potatoes, among
other varieties, and maintain acceptable levels of sales from thevarious subsectors based on profitability and performance efficiency benchmarked to global trends.

4.5 Market diversificationand penetration
options

Priority
1=low
2=medium
3=highActivities

Operational
objective

VCH

Exporters

Exporters

Beneficiaries

Support six major producers of FFVH to develop new
products ; between 3-6 varieties. Amount of new crops
being exported to global
customers.

Twenty fresh export growthin volumes and values.

Build the capacities of six
FFVH MSMEs, including cooperatives, to meet market requirements, as well as
promote the market-driven
approach to producers.

Support initiation of 10 new
direct market linkages withnew global customers for
fresh herbs, vegetables andfruits.

Target measures

Evaluation reports and total volumes and values of
new exported varieties asreflected in the authorizedpacking lists and commercial invoices of each
exporter

Total amounts of exported fresh produce for current global customers as
reflected in commercial
invoices

Evaluation reports on theparticipating MSMEs andperiodic feedback on progress

Reports reflect the number of business deals andcontracts signed with newcustomers as well as theamount of sales in thesecond and third years
using commercial invoices and packing lists

Means of verification

MoA

PalTrade

PalTrade

PalTrade

Leading
implementing
partners

Strategic Objective 4 : Increase the sector’s capacity and its ability to enter and sustain export relationships in current and emerging markets

PalTrade, PARC,
AAA, UAWC,
MoNE

Private exporting
companies

Agricultural cooperative unions,
PSC, PARC, MoA,
MoNE

MoNE, MoA, private sector andcooperative unions, international NGOs

Supporting implementing partners

200 000 –500 000

100 000 –300 000

500 000 1 000 000

1 000 000 –3 000 000

Estimated
costs

66
THE STATE OF PALESTINE SECTOR EXPORT STRATEGY • FRESH FRUITS, VEGETABLES AND HERBSANNEX 1 : SECTOR TEAM MEMBERS

ANNEX 1 :SECTOR TEAM MEMBERS
Name

Organization

E-mail1

Majeda Salameh

Ministry of National Economy

N/A

2

Ramiz Obaied

Ministry of Agriculture

N/A

3

E. Abeed

Ministry of Labour

N/A

4

Ahmad Eid

Ministry of Agriculture

N/A

5

Yazan Odeh

PARC

yazan_oudeh@yahoo.com

6

Hasanein Hasanein

PARC

global_gab50@yahoo.com

7

Yousef Salah

General Directorate of Extension & Rural
Development

pgb_palestine2006@yahoo.com

8

Suha Arar

Ministry of HealthSuha.arar@gmail.com

9

Ibrahim Atiya

Ministry of Healthib_atiya@yahoo.com

10

Moayyad Al Housani

Fedex

mhousani@rasilexpress.ps

11

Harbi Daraghmeh

Al Jeflek Cooperative

harbe_daraghmeh@hotmail.com

12

Khaled Dawod

PARC

km_5002@yahoo.com

13

Emad Al Banna

Bannabanna-com-1918@hotmail.com

14

Ala Masoud

ARIJ

amasoud@arij.org

15

Said Janan

Mount of Green Olives

janan-s@mgo.ps

16

Saleh Ahmad

UAWC

saleh_alahmad@hotmail.com

17

Adnan Jaber

Sinokrot

adnan@sinokrot.com

18

Tareq Abu Khaizaran

Agripaltareq@agripal.ps

19

Younes Yameen

Team Coordinatoryounesyameen@yahoo.com

20

Ayman Mousa

PARC

Ayman.mousa@pal-arc.org

21

Sameer Aljunaidy

Aljunaidy Co.

Aljunaidy co@yahoo.com

22

Shadi Darwesh

Ministry of Agriculture

shadidarweesh@gmail.com

23

Yousef Abo Awwad

Siniora Food Co.

yousefabuawwad@gmail.com

24

Mohammad Alamsri

Ministry of Agriculturealmasri@gmail.com

25

Tareq Abu Laban

Ministry of Agriculture

taareq@hotmail.com

26

Mohammad Abu Khaizran

ZadonaMohammad@sinkrot.com

27

Hosam Al Zorba

Pal Gardens

sanad_19833@hotmail.com

67

Name

Organization

E-mail28

Bassam Waleel

Golden Wheat Mills Company

bwalweel@gwmc.ps

29

Mustafa Barakat

Ministry of Agriculture30

Bassam Al Nimer

31

Sanad Sabri

32

Bakr Bsharat

33

Saber Amleh

Ministry of National Economy

amlehsaber@yahoo.com

34

Ahmad Showakah

PPU ( Palestine Polytechnic University )ahshw2002@yahoo.com

35

Hussien Ahmad

PFIA

xpertco@gmail.com

36

Ramzi Abu Khaizaran

Al Khaizaran Co.

37

Majdi Daraghmeh

Al Khaizaran Co.

38

Mohammed Al Sayyed

PSI

39

Manal Dsui

Ministry of National Economy

40

Munther Orekat

Ministry of National Economy

41

Saleh Fareed

Ministry of Labour

bsawafth1965@yahoo.com
Pal Gardens

sanad_19833@hotmail.com
bakerbsharat@yahoo.com

malsayyed@psi.pna.ps

BIBLIOGRAPHYDAI Europe – TechnoServe ( 2011 ). A Roadmap for Agribusiness Development in the Occupied Palestinian Territories : An Analysis of the Vegetables & Herbs, Dairy,and Sheep & Goats Subsectors.
Fresh Plaza. ( 2013 ). Spanish exports of fruit and vegetables increased 13 % in 2012, 5 May. Available
from http : /  / www.freshplaza.com / news_detail.asp?id=106183
International Monetary Fund (2013). World Economic Outlook Database. Available from http : /  / www.imf.org / external / pubs / ft / weo / 2013 / 01 / weodata / weoselgr.aspx.
Accessed 5 May, 2013.
Palestine Economic Policy Research Institute ( MAS )( 2011 ). The Comparative Advantage of Selected Cropsin the West Bank Using the Policy Analysis Matrix Approach ( PAM ).
Palestinian Central Bureau of Statistics ( 2010 ). Agricultural Census.

Palestinian National Authority Ministry of Agriculture( MoA ) ( 2010 ). Agriculture Sector Strategy : “A Shared
Vision” 2011-2013.
World Bank ( 2009 ). Assesment of restrictions on Palestinian water sector development - Report No. 47657-GZ.
World Trade Organisation ( 2013 ). The WTO and the
FAO / WHO Codex Alimentarius. Available fromhttp : /  / www.wto.org / english / thewto_e / coher_e / wto_
codex_e.htm. Accessed 8 May.

Source: © Fadi Arouri – Jericho & Jordan Valley

Source: © Fadi Arouri – Jericho & Jordan Valley