Israel’s aggression in Palestine Raises Concerns for South Africa’s Economic Stability
Amidst the escalating conflict between Israel and Palestine, South Africa finds itself at a crossroads, with potential implications for its economic stability. Israel’s continued attacks and the possibility of a ground invasion in Palestine have drawn global condemnation despite calls for a ceasefire.
As of October 7, the Gaza Ministry of Health reported a devastating death toll of 6,546 citizens, including a staggering number of children, women, and elderly individuals. Moreover, 17,439 citizens have been injured, further exacerbating the dire situation in Palestine.
In response to the conflict, South African citizens have been vocal about their support for Palestine, but the business sector has largely remained quiet or neutral. Numerous protests expressing solidarity with Palestine have taken place, and the African National Congress (ANC) first deputy secretary-general, Nomvula Mokonyane, has recently advocated for the closure of the Israeli embassy in South Africa.
While the war may seem distant, its repercussions could impact South Africa in significant ways. Professor Emeritus of International Law at Unisa, André Thomashausen, sheds light on the intertwined nature of South Africa’s debt and its relationship with Israel. With an overburdened debt-to-GDP ratio of 82%, South Africa relies heavily on credit from Western banks, which predominantly offer unwavering support to Israel.
Thomashausen warns that adopting a hostile or emotionally-driven foreign policy towards Israel could pose a greater risk to South Africa’s financial and economic stability than its often criticized neutral stance in the Ukraine conflict. He further highlights the potential disruption that a radicalized, pro-Hamas South Africa could cause by driving away skilled individuals who fled Europe during the Holocaust. These individuals and their families currently contribute to key industries in science, medical services, finance, hospitality, and advanced engineering and manufacturing.
Although South Africa currently faces no immediate consequences due to its preference for de-escalation, any actions that harm Israeli ties could have severe ramifications. Thomashausen cites the potential discontinuation of the African Growth and Opportunity Act (AGOA) preferential trade arrangements by the United States as an example, which is already a cause for concern.
The international community, including major world powers and BRICS nations (except Iran), unequivocally supports de-escalation of the Gaza conflict. However, Thomashausen points out that finding acceptable solutions for the Palestinians’ plight has been an ongoing failure for many decades. This continuation of suffering goes against the teachings of Islam, Christianity, and Judaism.
To address the immediate and long-term consequences faced by both Israeli and Palestinian communities, Thomashausen emphasizes the need for confidence-building measures and open discussions. Drawing from the Conference on Security and Cooperation in Europe (CSCE) held in the 1970s, which laid the groundwork for detente during the Cold War, he highlights the importance of identifying and implementing concrete development plans with the support of powerful and wealthy nations in the region.
As tensions persist in the Middle East, South Africa finds itself navigating a delicate path that balances its citizens’ sentiments, its economic stability, and international relations. The hope remains that a peaceful resolution can be found, honoring the equal rights and progress of both Israeli and Palestinian people.
