EcoStream: This is a blip - trade with the UK is thriving

By Alex Brummer, July 10, 2014

The closure by SodaStream of its Ecostream shop and the reported decision by John Lewis to stop selling the Israeli company's drinks products can hardly be regarded as a positive development. Not surprisingly it has been hailed as a great victory for the BDS movement.

The two years of concerted protests against the store in Brighton clearly had an impact on income. But the opposition also had the positive effect of galvanising the local Jewish community into action, forming the Sussex Friends of Israel which has provided lively counter-demonstrations and strongly made Israel's case.

In the wider context of UK-Israel trade relations the closure of one store in a provincial city with a Green council and MP with a reputation for being sympathetic to the Palestinian cause, will, over time, be seen as no more than a blip.

Assiduous work by Britain's ambassador to Israel, Mathew Gould, and strong support for Israel on Downing Street has seen British-Israel trade flourishing. Over each of the past two years it has reached £2 billion and is projected to rise to £3 billion by 2015. Most encouragingly, Britain is tapping into Israel's high-tech expertise in building its own technology hub in London.

SodaStream, a company which can trace its origins back to London in the early years of the 20th century, has sought to bridge the economic gap between Israel and the West Bank with its plant, Mishor Adumin, that employs 500 Palestinians, including senior management. Despite the best efforts of the BDS movement, funded by the Palestinian Solidarity Campaign, its products remain highly popular across Europe.

Aside from the discomfort of the boycott campaign, SodaStream has big commercial challenges at present. A year or so ago it was seen as a potential takeover target for Pepsi-Cola. But since then Pepsi's main rival, Coca-Cola, has bought a substantial stake in Keurig Green Mountain, a commercial rival to SodaStream. The move has led to a downgrade in the Israeli company's shares on the Nasdaq stock market.

There is no doubt that BDS campaingers have been stepping up their activities against companies seen to have a West Bank connection. The security firm G4S has been targeted for its management of Israeli prisons holding Palestinians. Sainsbury's, like the Co-op before it, is facing criticism for selling Israel and West Bank agricultural produce - this week protesters targeted its annual general meeting.

But the reality is that, while it is encouraging to see Israel produce on sale in supermarkets, the country has moved a long way from the days when it was dependent on fresh produce for export income.

Israeli firms provide some of the cyber-security used by British banks and have been at the forefront of the gaming revolution that has transformed Britain's betting industry. From the controlling cards in Sky boxes to medical devices and pharmaceuticals Israeli products are part of the Israeli-British trade landscape.

BDS may feel it has won a victory. But it has been fought in the sympathetic territory of Brighton and on a very narrow front. Its importance should not be exaggerated.

Alex Brummer is City Editor of the Daily Mail

Last updated: 3:45pm, July 10 2014