Annexing Palestine Through Trade: CIFTA and the Occupied Palestinian Territories

This report evaluates the Canada-Israel Free Trade Agreement (CIFTA) and its relationship to the occupied Palestinian territories (OPT). The report demonstrates that CIFTA treats the OPT as if it was already formally annexed by Israel, that Palestinians were never a partner or signatory to the agreement, and that Palestinians do not really benefit economically from it. The report concludes with recommendations for how Canada can support trade with Palestine without reinforcing Israel’s occupation and apartheid.

Issued September 2023

Click here to download the full report as a PDF

Executive Summary

When the Canada-Israel Free Trade Agreement (CIFTA) came into force in 1997, Canadian officials decided that its trade benefits would be applied to the occupied Palestinian territories (OPT) of the West Bank, East Jerusalem, and Gaza, as well as the occupied Syrian Golan Heights. This inclusion made CIFTA unique among Canada’s trade deals. Although it is a deal negotiated and signed between Israel and Canada, its provisions have been transferred onto a third party – the Palestinians – without their involvement or meaningful consent. In doing so, CIFTA expands far beyond Israel’s internationally recognized borders, extending into occupied territory over which Israel does not have sovereignty.

Extending CIFTA to the occupied territories was officially pitched by Canadian officials as a way to support the peace process and kickstart Palestinian economic development. However, this report demonstrates that CIFTA ultimately leaves Palestinians worse off. Any nominal benefits from CIFTA are far outweighed by the damage that it causes by supporting Israel’s illegal settlements and permanent military occupation, the very structures that are most responsible for harming the Palestinian economy.

The report outlines three major thematic issues with Canada’s application of CIFTA to the OPT:

For the purposes of trade, Canada does not make any distinction between trade with Israel, Palestine, or illegal Israeli settlements, but categorizes all trade in the territories under Israeli control as if it was simply “Israeli.” This contradicts Canadian foreign policy and international law, erases the Palestinian identity of OPT trade, and provides a material incentive and economic reward to Israel’s ongoing settlement activity. The overall effect is that through CIFTA, Canada treats the OPT as if it were already annexed by Israel.
Palestinians were never a partner or signatory to CIFTA, and the extension of CIFTA to the OPT was done without their meaningful consent. On the contrary, the State of Palestine explicitly rejects the “core” of CIFTA and takes issue with the extension of trade benefits to illegal settlements. Palestinian civil society does not support CIFTA and is urging the international community to cancel their free trade agreements with Israel as a form of economic pressure.
As a whole, Palestinians do not benefit economically from CIFTA. Canada-Palestine trade represents only an estimated 0.5% of the total merchandise trade under CIFTA, while Canada’s trade with Israel makes up 99.5%. Any benefit that Palestinians receive from CIFTA is a pittance, and this is vastly outweighed by the harm that CIFTA causes by upholding the status quo. Israel’s occupation is the number-one obstacle to Palestinian economic development, while Israeli settlement expansion has more than tripled since CIFTA was signed in 1996, growing at the same pace as Canada-Israel trade.

The report argues that Canada should support Palestinian trade without reinforcing the oppressive structures of military occupation, annexation, and apartheid. CJPME recommends that the Canadian government should:

Suspend the Canada-Israel Free Trade Agreement (CIFTA) until Israel ends its military occupation of the Palestinian territories, dismantles its apartheid policies, and complies with international law;
Cease the practice of subsuming Palestinian trade under ‘Israel,’ and start properly identifying, tracking, and reporting imports from the OPT. These goods (excluding those originating in Israeli settlements) should be labelled and reported as originating from ‘Palestine’ or occupied Palestinian territory.
End all trade with Israel’s illegal settlements in the OPT by prohibiting the trade of goods, services, and investment. Until this policy comes into effect, Canada should at a minimum properly identify, label, and report settlement goods as originating from Israeli settlements in the OPT and exclude them from benefits under CIFTA.
Negotiate directly with Palestinians regarding measures to promote trade in the OPT, including East Jerusalem.
Protect Palestinian economic development by imposing consequences against Israel for any closures and restrictions on the movement of people and goods in the OPT, including the brutal and illegal 16-year blockade of the Gaza Strip.

Part 1: Canada’s trade policy treats the occupied Palestinian territory as if it was formally annexed to Israel

In 1996, Canada and Israel signed the Canada-Israel Free Trade Agreement (CIFTA), which came into effect on January 1, 1997. When introducing C-61, An Act to Implement the Canada-Israel Free Trade Agreement into Parliament, the Canadian government declared that it would also apply to Palestinians. As announced by Art Eggleton, Minister for International Trade: “While the agreement is between Canada and the Government of Israel, we intend to extend the same benefits to the Palestinians. We will be meeting with Palestinian officials to examine the best ways to go about this.”[1]

Eggleton pitched the inclusion of Palestinians under CIFTA as a “major contribution towards the peace process,” because “in helping the economic prospects for the people of the West Bank and Gaza we help to further the opportunities for peace and security for all of the people in the Israeli territory.”[2]

In practice, however, the way that CIFTA was extended to Palestinians was to subsume them under Canada’s trade with Israel, bolstering Israel’s illegitimate control over the OPT:

First, CIFTA was extended to the entire area where Israeli customs law applies, including the occupied territories of East Jerusalem, the West Bank, and Gaza. This was based on an interpretation of an interim customs arrangement signed by Israel and the Palestinians in 1994 (the ‘Paris Protocol’) as part of the Oslo peace process, which was intended to expire in a period of five years with the creation of an independent Palestinian state. See more on this below.
Second, CIFTA does not differentiate between Israel and the OPT but considers all trade from these territories as if it originated in Israel. As described by the chair of the Parliamentary trade committee in 1996, “Canadians will consider that goods manufactured in Palestinian areas are as if they were rule of origin in Israel itself for the purpose of being admitted into Canada.”[3]

This policy directly contradicts Canada’s own foreign policy position as well as international law. Officially, Canada “does not recognize permanent Israeli control over territories occupied in 1967 (the Golan Heights, the West Bank, East Jerusalem and the Gaza Strip),”[4] and yet CIFTA operates as if the opposite is true. Moreover, Canada’s policy violates UN Security Council Resolution 2334 (2016) which mandated states to “distinguish, in their relevant dealings, between the territory of the State of Israel and the territories occupied since 1967,” [5] as well as UNSC Resolution 465 (1980), which calls upon states “not to provide Israel with any assistance to be used specifically in connexion with settlements in the occupied territories.”[6]

From the start, this contradiction was noted by CIFTA’s critics. Bloc Quebecois MP Benoît Sauvageau warned in 1996 that “to apply the Canada-Israel Free Trade Agreement to Palestinian territory would be to recognize the albeit illegal control the State of Israel has over the Palestinian people.”[7] The BQ perceptively raised this issue again in 2018, in remarks by MP Gabriel Ste-Marie:

I want to point out an anomaly in the agreement as drafted that must be corrected. Although we are supposed to be debating a free trade agreement between Canada and Israel, that is not what the text states. In fact, this seems to be an agreement with Israel and the occupied territories. By ratifying the agreement as written, Canada would be in some way recognizing that the occupied territories actually belong to Israel. Such a position is in contravention to Canada's foreign policy, international law and the will of the UN Security Council.[8]

This policy appears even more dangerous in the context of Israel’s drive to illegally annex the occupied West Bank, following its unilateral attempt to annex East Jerusalem in 1980. In the first half of 2023, Israel’s far-right government undertook a series of changes to the structure of governance over the OPT, including the transfer of authority into civilian hands and outside of the purview of the military, as well as the expedition of settlement expansion. These changes are widely understood to amount to the annexation of the territory.[9] In moving the OPT from military rule to civilian rule, the Israeli government appears to admit that its presence is a permanent civilian one, vs. a temporary military one.[10] In doing so, Israel formalizes its two-tier legal system in the OPT in which Jewish Israelis are subject to one set of laws and Palestinians are subject to another – a racist regime that has been defined as “apartheid” by Amnesty International, Human Rights Watch, Israeli human rights group B’Tselem, and others.[11] Along these lines, a joint report by 17 leading Israeli NGOs has warned that Israel’s recent policy changes “will expedite the annexation of the West Bank, and will further cement the annexation of East Jerusalem,” and that these steps, “motivated by [the Israeli government’s] stated Jewish supremacy ideology, will also deepen the apartheid regime governing nearly all aspects of oPt Palestinians’ lives.”[12]

Amid this background, CIFTA continues to operate as if the territory were already annexed to Israel, treating both Palestinian goods and Israeli settlements as Israeli. This presents two main practical implications for trade between Canada and businesses in the OPT, explored below.

A. Canada does not report any trade with Palestinians in the OPT

One consequence of Canada treating trade with Palestine as Israeli is that Palestine and Palestinians are erased from Canada’s trade reporting and statistics. For example, there is no code for Palestine in the List of Countries in the Canadian Importers Database, which only includes Israel.[13] This is despite the fact that Palestine has an internationally accepted country code which Canada could use if it chose to.[14] Palestine is also missing from the List of Countries in Canada’s Trade Data Online, which only notes next to Israel that “trade with Gaza Strip and West Bank [is] reported separately from Israel [only] in isolated instances.”[15]

In fact, Canada does not report any trade with Palestine or Palestinians. A factsheet produced by the Canadian government reports all trade with the “West Bank and Gaza” as simply “N/A” – not applicable.[16] When it comes to reporting its trade with Israel, on the other hand, Canada’s factsheet provides detailed statistics including foreign direct investment and the types of goods being traded.[17] This asymmetry demonstrates how under CIFTA, trade with Israel is celebrated while trade with Palestinians is erased.

The lack of data is not because there is no Canada-Palestine trade. The State of Palestine does report some statistics on trade with Canada, and the implications of that data will be explored below.

The erasure of Palestine also affects Canadian consumers: Canada has concealed the word ‘Palestine’ on the labels of imported goods, by covering it with a sticker which simply says ‘West Bank.’[18] This erases the specifically Palestinian origin of these goods, and is a further indication of the second-class status that Palestinians suffer in Canadian trade policy.[19]

B. Canada extends trade benefits to illegal Israeli settlements in the OPT

A second consequence of applying CIFTA to the OPT is that it also extends to trade with the illegal Israeli settlements which are located there. From CIFTA’s perspective, trade with settlements is simply considered trade with Israel. This directly contradicts Canada’s official foreign policy, which recognizes that “Israeli settlements in the occupied territories are a violation of the Fourth Geneva Convention.”[20]

In practice, this means that businesses located in illegal settlements can benefit from CIFTA’s trade privileges. Historically, it has also meant that Canada has labelled products from settlements as “Product of Israel.” CIFTA thereby erases any distinction between Israel and the territories it belligerently occupies and provides an economic incentive for Israel to expand and consolidate its illegal settlement enterprise.

The Canadian government was aware of this problem from CIFTA’s inception. The issue of illegal Israeli settlements was first raised in 1996 when CIFTA was initially debated. At that time, the Parliamentary committee was warned by Michael Lynk, Secretary-Treasurer of the National Council on Canada-Arab Relations (NCCAR), that “It would be quite destructive of the peace process if, as part of this agreement, there were an unverifiable, unregulated entry into Canada of goods made or produced in whole or in part on those settlements.”[21] This is exactly what has happened since.

Settlements became a major issue of debate once again during the “modernization” of CIFTA in 2018-2019. This modernization followed shortly after the adoption of UN Security Council Resolution 2334 which highlighted the need for states to distinguish in their dealings between Israel and the OPT. This issue was raised by witnesses who told the committee that CIFTA failed to make this distinction by extending trade benefits with Israel to the settlements, thus violating UNSC 2334.[22] According to Alex Neve, Secretary General, Amnesty International Canada, “extending the scope of the deal to trade originating in illegal Israeli settlements within the OPT amounts to benefiting from and facilitating violations of both international humanitarian law and international human rights law.”[23] Such issues were also raised by MPs. Don Davies (NDP) said it was “unjustifiable and perplexing” that CIFTA failed to distinguish between Israel and the OPT settlements, and said he was “gravely concerned” that it failed to meet the standard of UNSC 2334 and “puts us afoul of international law.”[24] Cheryl Hardcastle (NDP) similarly argued that “By including settlement products in the provisions of the CIFTA, such treatment de facto legitimizes the settlements, encourages their economic growth and contributes to their permanence.”[25]

Canada’s extension of trade privileges to illegal Israeli settlements also contradicts United Nations guidelines which discourage economic activity in the settlements. The UN Human Rights Council (HRC) has affirmed that the UN’s “Guiding Principles on Business and Human Rights” applies to the context of the OPT and Israeli settlements, and that states should discourage business activity that may support the “continuation of an international illegality” or is “complicit in human rights abuses.”[26] More explicitly, the UN HRC has urged states to “ensure that they are not taking actions that either recognize, aid or assist the expansion of settlements,” and to “take appropriate measures to help to ensure that businesses domiciled in their territory and/or under their jurisdiction, including those owned or controlled by them, refrain from committing, contributing to, enabling or benefiting from the human rights abuses of Palestinians.”[27] Human Rights Watch and Amnesty International have similarly called upon states and businesses not to do business in the settlements, warning that it is impossible to do so in a way that respects human rights and international law.[28]

From a consumer perspective, the labelling of goods from Israel’s illegal settlements has also been problematic. To date, products from illegal settlements have been marked as “Product of Israel,” without specifying their actual origin. Even worse, the Canadian government has repeatedly intervened to maintain this status quo. When the Canadian Food Inspection Agency (CFIA) decided in 2017 that wines from Israeli settlements could not be labeled “Product of Israel” and ordered them to be removed from store shelves, the federal government intervened, forcing the agency to reverse its position in less than 24 hours.[29] When a federal court ruled in 2019 that such labels were “false, misleading and deceptive,” the government appealed the ruling.[30] After finally and conclusively determining in 2022 that the labels were “false” and had to be changed,[31] the CFIA has now launched a public consultation into the labelling of goods from “a contested territory,”[32] but it is not clear what the outcome will be.

Canada does not publicly report how much trade it does with Israeli settlements, and it is unclear whether Canada even tracks this data. If indeed Canada does not track such data, it further erodes the distinction between Israel and the OPT and actively enables Israel’s illicit scheme to annex the territory.

While there is no existing country code apart from ‘Israel’ that could easily capture this data and identify settlement goods, this does not absolve Canadian policy but underscores the extent of the problem. Without a mechanism to distinguish trade with Israel from trade with settlements, there is no safe trade policy with Israel that would not violate Canada’s responsibilities under international law. Nonetheless, Canada’s attempts to prohibit the import of goods “produced wholly or in part by forced labour” suggest that it is possible for Canada to intervene in trade matters on human rights grounds, and that it can look to mechanisms beyond simple “country of origin” to do so.[33]

Part 2: Palestinians did not meaningfully consent to be incorporated under CIFTA

A. The Palestinians were not a partner to CIFTA and did not give meaningful consent

Since CIFTA’s inception, the Palestinians have not been a signatory or partner to the agreement. After the agreement was signed by Canada and Israel, Canadian officials passed the finalized text to the Palestinians explaining how the agreement would be extended to them, and how Palestinians would benefit from it.[34] In other words, Palestinians were added on later to an agreement that was finalized without them, rather than being involved as participants in the shaping of the deal.

For this reason, part of the debate over CIFTA in 1996 focused on the question of whether Palestinians had truly given their consent to be covered by it. As Prof. Kubursi of the National Council on Canada-Arab Relations (NCCAR) told MPs, the way that Palestinians were included in discussions about CIFTA was paternalistic:

If [Canada] is indeed intending to bring the Palestinians in, then please bring the Palestinians in. Let them represent themselves and let's not […] keep the Israelis operating as this paternalistic occupying force that's dictating to the Palestinians. That's the first thing.[35]

The Canadian government insisted that consultation with the Palestinian Authority and Palestinian business leaders was ongoing and that the reception was “quite favourable.”[36] Although they were unable to produce a document from the Palestinian Authority demonstrating their explicit consent for CIFTA, Ron MacDonald, Parliamentary Secretary on International Trade insisted that “to date, nobody on the Palestinian side has told us this is not a good deal,”[37] and that “they have not told us no.”[38] This did not satisfy Opposition MPs, who argued that CIFTA’s implementation should be delayed until consultations with the Palestinians were concluded. As BQ MP Francine Lalonde said, “Some claim that the Palestinians had no problem with this agreement. We have asked for proof of this. Until we are given proof to the contrary, however, we have our doubts.”[39]

When CIFTA was modernized in 2018-2019, the Canadian government once again claimed that Palestinians were content with the arrangement. Jim Carr, Minister of International Trade Diversification, claimed to be “very satisfied” with his visit to Ramallah which included “an excellent day of conversations with business leaders and government representatives.”[40] When he was asked if he had heard any complaints from Palestinians about CIFTA, he responded: “No […] I heard an awful lot about the Palestinian perspective of the situation, but CIFTA was not raised.”[41]

This claim – that Palestinians never raised concerns over CIFTA – is directly contradicted by statements from the State of Palestine’s Ministry of Foreign Affairs and Expatriates. A position paper presenting “Palestine’s official position regarding CIFTA,” provided to CJPME in 2022, states that “Palestine has never consented to CIFTA, and has in fact rejected it repeatedly.” Moreover, the document notes that Palestine’s critical objections to CIFTA, especially regarding the inclusion of settlements, have been “officially relayed to several Canadian Foreign Ministers” including current Minister Mélanie Joly.[42] In summarizing:

The Palestinian position on CIFTA has been stated repeatedly through different Canadian administrations. We reject its core, which is based on including Occupied Palestinian Territories as Israeli lands, rebuffing international law when it comes to conducting business with illegal Israeli settlements, and ignoring the main principles of the two-state solution, which Canada itself claims it is an ardent supporter of.[43]

This statement from the State of Palestine rejecting CIFTA should be taken seriously by Canadian officials, as it outlines a clear lack of consent. CIFTA cannot be said to be an ethical or responsible arrangement if its specifics have been imposed upon Palestinians against their will.

B. The Paris Protocol does not imply meaningful consent for CIFTA’s inclusion of settlements

If Canadian officials have been unable to prove explicit Palestinian consent for CIFTA, they have argued that such consent is implied due to the signing of two trade-related agreements in the 1990s. These two agreements include:

The Protocol on Economic Relations between the Government of the State of Israel and the P.L.O., representing the Palestinian people, a.k.a. the Paris Protocol[44] – This is an agreement signed by Israel and the Palestinians in 1994 as part of the Oslo peace process, in which they entered into a temporary customs union to facilitate the movement of goods during the period of transition to an independent Palestinian state. It was only intended to last for 5 years.
The Joint Canadian-Palestinian Framework for Economic Cooperation and Trade Between Canada and the Palestine Liberation Organization on Behalf of the Palestinian Authority[45] – This is an agreement signed by Canada and the Palestinians in 1999 for the purpose of facilitating market access and economic cooperation.

The Government of Canada website claims that the latter agreement, by “taking note” of the earlier Paris Protocol, “confirmed PA approval to apply preferential tariffs under CIFTA to goods produced in the West Bank and Gaza.”[46] Pursuant to that claim, Canadian officials argue that Palestinians have effectively agreed to the principle that CIFTA can rightfully apply to illegal settlements in the occupied territories.[47]

To be sure, this argument had been made easier in the absence of a clear and public position from the Palestinians regarding CIFTA, which has admittedly created significant ambiguity. After all, the 1999 Joint Framework agreement to expand Canada-Palestine trade was signed in the context of CIFTA, which had come into force two years earlier, and it did not include any language rejecting CIFTA’s extension to trade with settlements.

More recently, however, the State of Palestine has been explicit about its position that the 1999 Joint Framework should not be understood as consent for CIFTA’s inclusion of the settlements. In its position paper from 2022, the State of Palestine rejected Canada’s interpretation of the Joint Framework, stating:

In the course of negotiating the 1999 Framework on Economic Cooperation and Trade with the government of Canada, the Palestinian Authority neither consented to nor acknowledged the inclusion of Israeli settlements in the Israeli-Palestinian Customs Union created under the Paris Protocol. Furthermore, it did not acknowledge the subsequent inclusion of settlements in the definition of Israeli territory for the purposes of the Canada-Israel Free Trade Agreement.[48]

The State of Palestine insists that “the PA/PLO would never have agreed” to the inclusion of Israel’s settlements in the customs union.[49] This is consistent with the analysis of Michael Lynk, Associate Professor of Law at Western University and former United Nations Special Rapporteur on the situation of human rights in the Palestinian Territory occupied since 1967. Lynk told a Senate Committee in 2019 that Canada’s interpretation of the customs union is “mistaken”:

There is no […] basis in the customs union of the Paris Protocol to say that the benefits of the customs union were meant to extend to Israeli settlements or to allow Israel to expand the definition of its borders or the scope of its sovereignty to include settlements in any free trade agreement.[50]

As Lynk has pointed out, the sole reference to “settlements” in the text of the protocol relates to the collection of taxes from Palestinians working in Israeli settlements,[51] not to the application of the customs union there. Canada’s policy does not reflect Israel’s actual customs agreement with the Palestinians, but rather Israel’s own self-serving interpretation of it – even though it violates Canada’s own foreign policy positions and international law.

Finally, it must be noted that the decision of Palestinians to enter into a customs union in 1994 – still in effect nearly 25 years after its intended expiry date – does not signify meaningful consent. Under occupation, but with the hope of achieving independence within only five years, Palestinians were not in a position to refuse this agreement, which was not necessarily favourable or fair. The arrangement left the Palestinians without any meaningful control over its economy, giving Israel control over economic decisions regarding tariffs, taxes, exports and imports, and monetary policy. Israel has also retained the power to arbitrarily withhold tax revenues, close borders to the movement of goods, and prevent Palestinian workers from entering Israel. As the United Nations Economic and Social Commission for Western Asia observes, the Paris Protocol “formalized the acutely asymmetric relationship between the Palestinian and Israeli economies” and has been “exceedingly damaging to the Palestinian economy.”[52] According to Israeli NGO B’Tselem:

The Palestinian Authority had no choice but to accept the model set forth in the Protocol, because Israel made acceptance a condition for Israel's continuing to allow Palestinians to work in Israel. Israel imposed the condition at a time that the Palestinian Authority was unable to provide employment within the autonomous areas to the tens of thousands of Palestinians working in Israel. […] The relations established in the Paris Protocol emphasized the disparity in power that had existed between the two sides from the start.[53]

When Canada appeals to the Paris Protocol to justify extending free trade benefits to illegal Israeli settlements, it only reinforces and exploits this disparity to its own purposes.

C. Palestinian civil society rejects free trade agreements with Israel

CIFTA cannot be said to have popular Palestinian support or consent. Palestinian civil society is overwhelmingly opposed to free trade agreements with Israel. In 2005, more than 170 Palestinian civil society organizations issued a call for the international community to adopt boycotts, divestment, and sanctions against Israel until it respects human rights and international law.[54]

Most recently in 2023, Palestinian trade union bodies and professional syndicates issued a statement explicitly urging the international community to “suspend free trade agreements with Israel.” Signatories included the General Union of Palestinian Workers (GUPW), Palestinian Union of Postal, IT & Telecommunications Workers, Palestinian General Federation of Trade Unions (PGFTU Jericho), Palestinian General Federation of Trade Unions (PGFTU Gaza), Federation of Independent Trade Unions, General Union of Palestinian Teachers (GUPT), The Palestinian New Federation of Trade Unions, Union of Palestinian Farmers, General Union of Palestinian Peasants, Agricultural Cooperatives Union, Palestinian Engineers Association, Palestinian Bar Association, Palestinian Agriculture Engineers Syndicate, Palestinian Veterinarians Syndicate, Palestinian Dental Association, and the Palestinian Medical Association.[55]

Part 3: CIFTA does not benefit Palestinians as promised

A. Looking at the numbers: Palestine makes up 0.5% of trade with Canada under CIFTA

The inclusion of Palestinians under CIFTA has always been promoted as something that will provide material benefits to the Palestinian people. As initially pitched by Art Eggleton, Minister for International Trade in 1996: “The sooner we put that into effect for them, the sooner job opportunities will help flow through and improve their economy. That kind of economic development is needed to help bring about stability in the area.”[56]

It is plausible that a small number of Palestinian businesses may have been able to take advantage of CIFTA’s trade privileges. Even the State of Palestine admits that being part of CIFTA allows “Palestinian entities to collect some customs exemptions on some goods.”[57] However, it is very difficult to determine the extent to which Palestinians have benefitted from CIFTA in practice, given the absence of any official statistics. During the modernization of CIFTA in 2018, the government was asked if it is “possible for Canada to assess how Palestinians have tangibly benefited from the original agreement?” In response, Global Affairs Canada asserted that the Canada-Palestinian trade relationship had indeed “benefited from CIFTA” but declined to present any data that would demonstrate such a benefit.[58]

To circumvent the issue of Canada’s missing statistics on trade with Palestine, we can look at the trade figures as reported by the State of Palestine itself (which are available on international trade databases). These figures should be taken with some caution, as the State of Palestine claims that “there are no accurate statistics” on Canada-Palestine trade, which it blames on “the fact that Canada does not follow any official channels in its businesses in Palestine, neither is it bound by particular agreements with the Palestinian government.”[59] The available data also does not include other forms of trade including direct investment. Nonetheless, by taking together the figures reported by the State of Palestine (re: trade with Canada)[60] with figures reported by Canada (re: trade with Israel),[61] we can do a rough comparison of the relative volumes of merchandise trade with each:[62]

In 2021, Canada imported $3,120,000 from Palestine compared to $1,314,919,256 from Israel. As such, imports from Palestine represented only 0.2% of CIFTA’s total.
In 2021, Canada exported $5,865,000 to Palestine compared to $478,964,417 to Israel. As such, exports to Palestine represented only 1.2% of the total.
Combining exports and imports for 2021, Canada’s total trade with Palestine amounts to approximately 0.5% of the total merchandise trade under CIFTA.

To put the numbers for trade with Palestine into perspective, Canada’s 2021 exports to Palestine (est. $5.86m) are lower than Canada’s 2022 exports to Myanmar ($7.3m), a country which does not have a free trade agreement with Canada, and which is under various Canadian sanctions.[63] Canada’s 2021 exports to Palestine are also lower than its exports to Yemen the same year ($6.9m).[64] After more than 25 years of its inclusion into CIFTA, Palestine remains near the bottom of the list of Canada’s trading partners.

Plainly, Israelis and Palestinians do not come close to benefitting equally under CIFTA. On the contrary, Canada imports 421 times more from Israel than it does from Palestine, and exports 81 times more to Israel than it does to Palestine. For reference, there are over 9 million people reportedly living in Israel (this figure includes about 2 million Palestinians with Israeli citizenship, as well as 700,000 Jewish settlers living in the OPT),[65] while there are over 5 million Palestinians living under military occupation in the OPT (the West Bank, East Jerusalem, and Gaza).[66] If the benefits of CIFTA were enjoyed proportionately to the relative size of the populations, you would expect to see trade with Palestinians in the OPT account for more than a third of the total merchandise trade under CIFTA. Instead, this segment of trade amounts to approximately 0.5%.

The asymmetry between Canada’s trade with Israel and Palestine is not only quantifiable but also symbolic. Despite the government’s insistence that they always intended for Palestinians to benefit from CIFTA, there is no mention of Palestine or Palestinians in the text of CIFTA itself, nor in the extensive promotional materials about CIFTA on the Government of Canada website.[67] Their absence underlines the fact that Palestinians are not a priority in the agreement, nor are they partners or true participants.

B. Doing more harm than good: Incentivizing occupation and settlements

Ultimately, even if there were greater economic benefits for Palestinians under CIFTA than there currently are, this would not outweigh its economic and political costs. By incentivizing the status quo of military occupation and settlement expansion, CIFTA entrenches the very structures that are most responsible for harming the Palestinian economy.

The biggest obstacle to economic development in Palestine is undeniably the Israeli occupation.[68] The United Nations Conference on Trade and Development (UNCTD) has concluded that the cumulative economic toll of certain Israeli restrictions on Area C of the occupied West Bank amounted to a staggering $50 billion in GDP loss during the period 2000-2020.[69] The economic cost of Israel’s occupation, blockade and closure of Gaza between 2007-2018 is estimated at $16.7 billion.[70] The effects of Israeli restrictions and economic control in the OPT are often referred to by UN bodies as “de-development” and “economic evisceration,” destroying the local capacity for economic growth and making Palestine dependent on foreign aid.[71]

There is also good reason to believe that CIFTA has facilitated the accelerated growth of Israel’s illegal settlement population, which has expanded alongside Canada-Israel trade at an equivalent pace. Canada boasts that Canada-Israel merchandise trade has “more than tripled” since CIFTA came into force in 1997, from $507 million in 1996 to $1.8 billion in 2021.[72] In that same time period, the Israeli settler population living illegally in the occupied West Bank (excluding East Jerusalem) has more than tripled as well, skyrocketing from 146,900 in 1996 to 465,400 in 2021.[73]

As Michael Lynk warned a Senate committee in 2019, “whatever benefit” that Palestinians may receive from its agreements with Canada is “more than negated by the fact that we trade and allow the benefits of our free trade agreement to go to the Israeli settlements, which are exceptionally detrimental to the Palestinian economy.”[74]

Part 4: Previous Attempts to Challenge CIFTA

There have been many proposals over the years to amend CIFTA in a way that would align Canadian trade policy with its foreign policy and international law. Many groups have also argued that CIFTA should be dropped altogether, as a way to “exert pressure on the Israeli government to change course.”[75] Short of cancelling CIFTA, Canadian civil society and parliamentarians have repeatedly urged changes to:

Exclude settlements from free trade benefits;
Label goods originating in illegal settlements;
Exclude the OPT from CIFTA’s jurisdiction; and/or
Ban trade with settlements altogether.

During the initial debate over CIFTA in 1996, the NCCAR proposed to a parliamentary committee that CIFTA should include an “explicit provision that forbids the import into Canada of any goods made or produced on Israeli settlements in any of the territories occupied by Israel, together with an effective means for verifying compliance with this provision.”[76] After listening to witness testimonies, the BQ proposed to “defer the implementation” of CIFTA until the peace process was “well underway” and until the negotiations “on the future of the occupied Palestinians territories” were “completed.”[77] These proposals were defeated.

Between 2002 and 2005, BQ MP Pierre Paquette made three successive attempts to introduce a private member’s bill that would make goods from illegal settlements ineligible for CIFTA benefits. As he explained to Parliament, the purpose of the bill was to amend CIFTA “so as to exclude products which are classified by the Israelis as Israeli in origin but which in fact originate from Israeli settlements in the territories occupied since 1967 in the West Bank, the Gaza Strip, East Jerusalem and the Golan Heights.”[78] Paquette’s “An Act to amend the Canada-Israel Free Trade Agreement Implementation Act” was introduced as Bill C-439 and Bill C-308 in 2002, and as Bill C-326 in 2005. In 2005, CJPME brought delegates to Parliament Hill to talk to MPs about Bill C-326, but an election was called before Bill C-326 went to Committee. Unfortunately, none of Paquette’s proposed bills ever made it past the first reading. In its 2006 federal elections platform, the BQ pledged to reintroduce this initiative once again.[79]

In 2018, during debates over the modernization of CIFTA, the NDP moved an amendment to force products from illegal settlements to be properly labelled as such,[80] and the BQ moved to exclude the OPT from CIFTA altogether.[81] Both were ruled out of order. Meanwhile, witnesses to the Senate similarly urged CIFTA to exclude the OPT,[82] as did civil society groups in a joint letter to the Senate.[83] Significantly, Amnesty International urged a ban on imports from settlements and for CIFTA to be amended “such that it does not apply to any goods or services that are produced, in whole or in part, in the unlawful Israeli settlements, industrial parks, farms or other enterprises located in the OPT.”[84] This proposal was not adopted.

In subsequent years, both the Green Party of Canada (GPC) and the NDP have adopted stronger positions on CIFTA as their official party policy. In 2016, GPC members voted in favour of a “ban on the importation into Canada of products produced wholly or partly within or by illegal Israeli settlements, or by Israeli businesses directly benefiting from the illegal occupation,” among other measures.[85] In 2021, NDP members voted in favour of “ending all trade and economic cooperation with illegal settlements in Israel-Palestine.”[86]

Meanwhile, many Canadian civil society groups support taking action against settlement goods, either their exclusion from free trade benefits, banning their importation, or cancelling CIFTA altogether. These include (but are not limited to) Amnesty International Canada,[87] United Church of Canada,[88] Canadian Friends of Peace Now,[89] Mennonite Church Canada,[90] Canadian Friends Service Committee (Quakers),[91] Canadian Centre for Policy Alternatives (CCPA),[92] National Council of Canadian Muslims (NCCM),[93] Independent Jewish Voices (IJV),[94] CJPME, and many others.

Conclusion and Recommendations:

For over 25 years, Canada’s free trade agreement with Israel has also been applied to the territory under Israel’s belligerent military occupation. Although the Canadian government has positioned the inclusion of Palestinians under the jurisdiction of CIFTA as a benevolent policy, Palestinians did not meaningfully consent to this arrangement, and they do not materially benefit from it. On the contrary, CIFTA erases the distinctions between Israel, its colonial settlements, and the OPT, and gives improper economic incentives to illegal Israeli settlement expansion, undermining Palestinian rights and livelihoods in concrete ways.

In other words, Canadian trade policy treats the OPT as if it was already formally annexed by Israel. This de facto supports Israel’s attempts to consolidate its permanent presence and control over the OPT, rather than discouraging further colonization.

Although the extension of CIFTA to the OPT was ostensibly intended to support the peace process, it has done the exact opposite. International agreements like CIFTA have only emboldened Israel to strengthen its control over the OPT with impunity, rewarding the government without requiring any concessions or modifications to its illegal behaviour. It is therefore not surprising to see that Israel’s settler population in the occupied West Bank has more than tripled since CIFTA started giving free trade benefits to illegal settlements in 1997. Meanwhile, Israel has advanced steps that amount to the attempted annexation of the territory. CIFTA does not challenge this reality but directly supports it in material ways, economically rewarding settlement activity.

Canada should support Palestinian trade, but this must be pursued in a way that is inclusive and fair, without reinforcing the oppressive structures of military occupation, annexation, and apartheid.

Recommendations:

Canada should suspend the Canada-Israel Free Trade Agreement (CIFTA) until Israel ends its military occupation of the Palestinian territories, dismantles its apartheid policies, and complies with international law. Until Israel does so, CIFTA’s preferential trade benefits will continue to serve as a reward for the status quo and contribute to the deteriorating human rights situation. Suspending CIFTA would send a strong message to the Israeli government that business-as-usual cannot continue, and the possibility of its resumption would provide an incentive for Israel to respect international law;
Canada should cease the practice of subsuming Palestinian trade under ‘Israel,’ and start properly identifying, tracking, and reporting imports from the OPT. These goods (excluding those originating in Israeli settlements) should be labelled and reported as originating from ‘Palestine’ or occupied Palestinian territory. This would bring Canada into compliance with UN Security Council Resolution 2334, which requires that countries distinguish between Israel and the OPT. It would also enable consumers to identify and purchase goods from Palestinians in the OPT, and give policy-makers accurate data about Canada-Palestine trade.
Canada should end all trade with Israel’s illegal settlements in the OPT by prohibiting the trade of goods, services, and investment. This is necessary to ensure that Canada’s trade policy is consistent with international law and is not complicit in the illegal settlement enterprise. Canada’s approach could be modelled on its existing sanctions on trade with individuals and entities involved in Russia’s occupation and annexation of Ukraine.[95] Until this policy comes into effect, Canada should at a minimum properly identify, label, and report settlement goods as originating from Israeli settlements in the OPT and exclude them from any relevant trade benefits.
Canada should negotiate directly with Palestinians regarding measures to promote trade in the OPT, including East Jerusalem. Trade with Palestinians should not be an ‘add-on’ to Canada’s trade with Israel, but should be approached on its own terms. Only direct negotiations can ensure that Canadian trade policy is supporting, rather than undermining, Palestinian aspirations.
Canada should protect Palestinian economic development by imposing consequences against Israel for any closures and restrictions on the movement of people and goods in the OPT, including the brutal and illegal 16-year blockade of the Gaza Strip, and for illegally withholding customs revenues collected on behalf of the PA. Israel should face penalties for any practices that infringe upon the livelihoods of Palestinians and undermine the economic development of the OPT.

[1] Art Eggleton, House of Commons Debate, Wednesday October 9, 1996.

[2] Art Eggleton, House of Commons Standing Committee on Foreign Affairs and International Trade, Meeting No. 49, Tuesday, October 29, 1996. Initially, opposition members in the Bloc Quebecois and Reform supported the extension of CIFTA to the Palestinians as a tool to improve the situation under occupation. However, they withdrew their support after hearing criticism from witness testimonies during committee hearings. In the end, many opposition MPs echoed the concerns of civil society that a free trade deal would legitimize Israel’s new right-wing government (which under Benjamin Netanyahu was undermining the Oslo Accords), and that it would bolster Israel’s occupation of Palestinian territory. The BQ urged that the implementation of CIFTA should be delayed until further progress could be made in the peace process and towards an end to the occupation. See House of Commons Debate, Tuesday November 5, 1996.

[3] The Chairman (Bill Graham), Standing Committee on Foreign Affairs and International Trade, Meeting No. 49, Tuesday, October 29, 1996.

[4] Government of Canada, “Canadian policy on key issues in the Israeli-Palestinian conflict,” last updated January 20, 2023, https://www.international.gc.ca/world-monde/international_relations-relations_internationales/mena-moan/israeli-palestinian_policy-politique_israelo-palestinien.aspx?lang=eng#a06

[5] United Nations Security Council Resolution 2334, December 23, 2016, https://digitallibrary.un.org/record/853446?ln=en

[6] United Nations Security Council Resolution 465, March 1, 1980, https://digitallibrary.un.org/record/11767/?ln=en

[7] Benoît Sauvageau (BQ MP), House of Commons Debate, Tuesday November 5, 1996.

[8] Gabriel Ste-Marie (BQ MP), House of Commons Debates, November 7, 2018.

[9] Adalah: The Legal Center for Arab Minority Rights in Israel, “Position Paper: The Acceleration of the

Annexation of the West Bank under the 37th Israeli Government led by Prime Minister Netanyahu,” June

2023, https://www.adalah.org/uploads/uploads/Annexation_37th_govt_EN.pdf; Tamar Megiddo, Ronit Levine-Schnur and Yael Berda, “Israel is Annexing the West Bank. Don’t be Misled by its Gaslighting,” Just Security, February 9, 2023, https://www.justsecurity.org/85093/israel-is-annexing-the-west-bank-dont-be-misled-by-its-gaslighting/; Michael Sfard, “Israel is Officially Annexing the West Bank,” Foreign Policy, June 8, 2023, https://foreignpolicy.com/2023/06/08/israel-palestine-west-bank-annexation-netanyahu-smotrich-far-right/; Israeli Law Professors’ Forum for Democracy on Twitter (@lawprofsforum), March 6, 2023, https://twitter.com/lawprofsforum/status/1632422907400925184; Haaretz Editorial, “Israel's Cabinet Just Advanced Full-fledged Apartheid in the West Bank,” February 26, 2023, https://www.haaretz.com/opinion/editorial/2023-02-26/ty-article/.premium/israels-cabinet-just-advanced-full-fledged-apartheid-in-the-west-bank/00000186-8a7e-d525-a9ef-9efe63060000; Lily Galili, “Israel's West Bank annexation is coming, just not in the way you expected,” Middle East Eye, December 17, 2022, https://www.middleeasteye.net/news/israel-west-bank-annexation-coming-not-way-expected.

[10] Therefore, some human rights experts have argued that Israel’s military occupation is now illegal. See United Nations Office of the High Commissioner for Human Rights, “Israel must face new international legal push to end illegal occupation of Palestine, UN expert says,” October 27, 2017 https://www.ohchr.org/en/press-releases/2017/10/israel-must-face-new-international-legal-push-end-illegal-occupation; United Nations, “Israeli occupation of Palestinian territory illegal: UN rights commission,” October 20, 2022, https://news.un.org/en/story/2022/10/1129722; Yesh Din, “The Legal Status of the Israeli Occupation: Legal Opinion,” July 27, 2023, https://www.yesh-din.org/en/the-legal-status-of-the-israeli-occupation-legal-opinion/; United Nations Committee on the Exercise of the Inalienable Rights of the Palestinian People, “Study on the Legality of the Israeli Occupation of the Occupied Palestinian Territory, Including East Jerusalem,” August 30, 2023, https://www.un.org/unispal/document/ceirpp-legal-study2023/

[11] Amnesty International, “Israel’s Apartheid against Palestinians: Cruel system of domination and crime against humanity,” February 1, 2022, https://www.amnesty.org/en/documents/mde15/5141/2022/en/; Human Rights Watch, “A Threshold Crossed: Israeli Authorities and the Crimes of Apartheid and persecution,” April 27, 2021, https://www.hrw.org/report/2021/04/27/threshold-crossed/israeli-authorities-and-crimes-apartheid-and-persecution; and B’Tselem (The Israeli Information Center for Human Rights in the Occupied Territories), “A regime of Jewish supremacy from the Jordan River to the Mediterranean Sea: This is apartheid,” January 12, 2021, https://www.btselem.org/publications/fulltext/202101_this_is_apartheid. For a longer list of human rights groups and notable individuals who have adopted the terminology of apartheid in recent years, see CJPME, “Who is talking about Israeli apartheid?” https://www.cjpme.org/apartheid_list.

[12] The Platform – Israeli NGOs for Human Rights, “State of the Occupation: Year 56: A Joint Situation Report,” June 2023. Signatories include the Association for Civil Rights in Israel, Bimkom - Planners for Planning Rights, Breaking the Silence, HaMoked, Center for the Defence of the Individual, Combatants for Peace, Emek Shaveh, Gisha - Legal Center for Freedom of Movement, Human Rights Defenders Fund, Ir Amim, Parents Against Child Detention, Peace Now, Physicians for Human Rights Israel, Rabbis for Human Rights, The Public Committee Against Torture in Israel, Torah of Justice, Yesh Din, and Zazim - Community Action. https://img.haarets.co.il/bs/00000188-87cd-dded-a58e-afcdcb640000/1c/99/b8a6350e4172966ff934a86b0ec7/state-of-the-occupation-a-joint-situation-report.pdf

[13] Government of Canada, “List by country - Canadian Importers Database (CID),” last updated November 23, 2021, https://ised-isde.canada.ca/site/canadian-importers-database/en. Oddly, the database does have codes for other occupied territories, including Western Sahara, and for countries which no longer exist, like the USSR. That does not mean that Canada is reporting trade with these territories and countries – rather, many of these codes are likely historic entries which have not been deleted from the database.

[14] World Customs Organization, “Palestine becomes the 156th Contracting Party to the Harmonized System Convention,” March 10, 2017, https://www.wcoomd.org/en/media/newsroom/2017/march/palestine-becomes-the-156th-contracting-party-to-the-harmonized-system-convention.aspx

[15] Government of Canada, “List of Countries,” Trade Data Online, last updated January 16, 2014, https://ised-isde.canada.ca/site/trade-data-online/en/help-product/trading-partner-product/list-countries

[16] Government of Canada, “Canada-West Bank and the Gaza Strip fact sheet,” last updated May 2023, https://www.international.gc.ca/country-pays/fact_sheet-fiche_documentaire/west_bank_gaza_strip-cisjordanie_bande_gaza.aspx?lang=eng

[17] Government of Canada, “Canada-Israel fact sheet,” last updated May 2023, https://www.international.gc.ca/country-pays/fact_sheet-fiche_documentaire/israel.aspx?lang=eng

[18] Sarah Jabakhanji, “'An act of erasure': LCBO called out for sticker covering the word 'Palestine' on wine bottle,” CBC News, April 22, 2022, https://www.cbc.ca/news/canada/toronto/lcbo-taybeh-winery-palestine-bottle-covered-with-sticker-1.6424743

[19] In practice, these labels have only been applied to Palestinian goods. In theory, however, ‘West Bank’ could just as easily be applied to goods from illegal Israeli settlements as well. This shows how the category of ‘West Bank’ is unsatisfactory for the purposes of labelling, as it does not necessarily distinguish between goods from colonial settlements and indigenous Palestinian businesses in the same territory.

[20] Government of Canada, “Canadian policy on key issues in the Israeli-Palestinian conflict,” last updated January 20, 2023, https://www.international.gc.ca/world-monde/international_relations-relations_internationales/mena-moan/israeli-palestinian_policy-politique_israelo-palestinien.aspx?lang=eng#a06

[21] Michael Lynk, Secretary Treasurer, National Council on Canada-Arab Relations, House of Commons, Standing Committee on Foreign Affairs and International Trade, Meeting No. 49, Tuesday, October 29, 1996.

[22] Michael Lynk, Associate Professor, Faculty of Law, Western University, as an individual, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019.

[23] Alex Neve, Secretary General, Amnesty International Canada, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019.

[24] Don Davies (NDP MP), House of Commons Debates, October 29, 2018.

[25] Cheryl Hardcastle (NDP MP), House of Commons Debates, February 8, 2019.

[26] United Nations Office of the High Commissioner for Human Rights, “Statement on the implications of the Guiding Principles on Business and Human Rights in the context of Israeli settlements in the Occupied Palestinian Territory,” June 6, 2014, https://www.ohchr.org/sites/default/files/Documents/Issues/Business/OPTStatement6June2014.pdf. Since 2020, the UNHRC has maintained a database of businesses involved in Israeli settlement activity which serves as a “tool for constructive engagement to ensure full compliance with obligations and responsibilities under international human rights law” (i.e. by encouraging them to leave).See United Nations Human Rights Council, “Update of database of business enterprises in relation to Occupied Palestinian Territory,” June 30, 2023, https://www.ohchr.org/en/press-briefing-notes/2023/06/update-database-business-enterprises-relation-occupied-palestinian

[27] United Nations Human Rights Council Resolution A/HRC/52/L.42, “Israeli settlements in the Occupied Palestinian Territory, including East Jerusalem, and in the occupied Syrian Golan,” March 27, 2023, https://ap.ohchr.org/documents/dpage_e.aspx?si=A/HRC/52/L.42

[28] In 2016, Human Rights Watch concluded that “the context of human rights abuses to which settlement activity contributes is so pervasive and severe that businesses should cease carrying out activities inside or on behalf of settlements.” Human Rights Watch, “Occupation INC.: How Settlement Businesses Contribute to Israel’s Violations of Palestinian Rights,” January 19, 2016, https://www.hrw.org/news/2016/01/21/occupation-inc. In 2019, Amnesty International concluded that “a company cannot meet its responsibility to respect human rights and the standards of international humanitarian law while doing business with the settlements.” Amnesty International, “Think Twice: Can companies do business with Israeli settlements in the Occupied Palestinian Territories while respecting human rights?”, March 13, 2019, https://www.amnesty.org.uk/resources/thinktwice.

[29] Jillian Kestler-D'Amours, “Canada: Court hears lawsuit challenging Israeli settlement wine labels,” Middle East Eye, May 21, 2019, https://www.middleeasteye.net/news/canada-activist-court-challenging-product-israel-labels-israeli-settlement-wines

[30] Jillian Kestler-D'Amours, “Canada appeals court ruling against settlement wines labelled 'Product of Israel',” Middle East Eye, September 9, 2019, https://www.middleeasteye.net/news/canada-appeal-courts-ruling-settlement-wines-labelled-product-israel

[31] Jim Bronskill and Canadian Press, “Federal food agency ruling says two West Bank wines are not a 'Product of Israel',” CTV News, May 15, 2022, https://www.ctvnews.ca/business/federal-food-agency-ruling-says-two-west-bank-wines-are-not-a-product-of-israel-1.5904408

[32] Canadian Food Inspection Agency, “Canadian Food Inspection Agency launches consultation on origin labelling of imported foods from a contested territory,” July 10, 2023, https://www.canada.ca/en/food-inspection-agency/news/2023/07/canadian-food-inspection-agency-launches-consultation-on-origin-labelling-of-imported-foods-from-a-contested-territory.html

[33] In the case of forced labour, Canada requires companies receiving trade commissioner support to sign a “Xinjiang Integrity Declaration” if they are sourcing products from certain regions, which forces them to acknowledge that the company is not “knowingly sourcing products or services from a supplier implicated in forced labour or other human-rights violations and committing to conduct due diligence on their suppliers in China to ensure there are no such linkages.” A similar mechanism could potentially be used to ensure that products are not knowingly sourced from illegal Israeli settlements. However, critics say that the implementation of this policy has so far been unsuccessful. See Steven Chase, “Canada has little to show for its promises to combat forced labour in China, critics say,” Globe and Mail, August 7, 2023, https://www.theglobeandmail.com/politics/article-canada-has-little-to-show-for-its-promises-to-combat-forced-labour-in/.

[34] Art Eggleton, House of Commons Standing Committee on Foreign Affairs and International Trade, Meeting No. 49, Tuesday, October 29, 1996.

[35] Professor Kubursi, National Council on Canada-Arab Relations and McMaster University, Standing Committee on Foreign Affairs and International Trade, Meeting No. 49, Tuesday, October 29, 1996.

[36] Art Eggleton, House of Commons Standing Committee on Foreign Affairs and International Trade, Meeting No. 49, Tuesday, October 29, 1996; Ron MacDonald, Parliamentary Secretary re: Int’l Trade, House of Commons Debate, Tuesday November 5, 1996.

[37] “To date nobody on the Palestinian side has told us this is not a good deal, that it should not go forward and that they do not want the benefits of the Canada-Israel free trade deal to be equally applied to goods produced in the Palestinian territories.” Ron MacDonald, Parliamentary Secretary re: Int’l Trade, House of Commons Debate, Tuesday November 5, 1996.

[38] “They have not told us no. If the Palestinian authorities had believed that the best policy Canada could pursue for peace in the Middle East was not to have this deal, not to have the economic benefits accrue to Palestinian enterprises as well, they have had plenty of opportunity to tell us but they have not.” Ron MacDonald, Parliamentary Secretary re: Int’l Trade, House of Commons Debate, Tuesday November 5, 1996.

[39] Francine Lalonde (BQ MP), House of Commons Debate, Tuesday November 5, 1996.

[40] Jim Carr, Minister of International Trade Diversification, House of Commons Standing Committee on International Trade, Thursday, November 29, 2018.

[41] Jim Carr, Senate of Canada, Proceedings of the Standing Senate Committee on Foreign Affairs and International Trade, Issue No. 62, Evidence, Meeting of May 1, 2019. In a meeting the following day, witness Michael Lynk expressed skepticism about this claim, saying: “I’m not sure who Minister Carr met, but I’m sure if he had met with some of these Palestinian and Israeli human rights groups, they would have informed him very strongly of their position with respect to the Israeli settlements and their view that there should be an absolute prohibition on trade with them.” Michael Lynk, Associate Professor, Faculty of Law, Western University, as an individual, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019.

[42] State of Palestine, Ministry of Foreign Affairs and Expatriates, “Position Paper: Canada-Israel Free Trade Agreement (CIFTA),” provided to CJPME in 2022, https://assets.nationbuilder.com/cjpme/pages/7341/attachments/original/1694031006/CIFTA_position_paper_-_Palestinian_Authority.pdf?1694031006

[43] State of Palestine, Ministry of Foreign Affairs and Expatriates, “Position Paper: Canada-Israel Free Trade Agreement (CIFTA),” provided to CJPME in 2022, https://assets.nationbuilder.com/cjpme/pages/7341/attachments/original/1694031006/CIFTA_position_paper_-_Palestinian_Authority.pdf?1694031006

[44] “Protocol on Economic Relations between the Government of the State of Israel and the P.L.O., representing the Palestinian people,” https://unctad.org/system/files/information-document/ParisProtocol_en.pdf.

[45] Government of Canada, “Joint Canadian-Palestinian Framework for Economic Cooperation and Trade Between Canada and the Palestine Liberation Organization on Behalf of the Palestinian Authority,” last updated October 22, 2013, https://www.international.gc.ca/trade-agreements-accords-commerciaux/agr-acc/other-autre/palestine.aspx?lang=eng

[46] Government of Canada, “Canada-West Bank-the Gaza Strip relations,” last modified September 16, 2022, https://www.international.gc.ca/country-pays/west_bank_gaza_strip-cisjordanie_bande_gaza/relations.aspx?lang=eng

[47] In response to a question about why settlements are included in CIFTA, Minister Carr explained: “CIFTA defines Israel’s territory, for the purposes of this agreement, as the territory where its custom laws are applied, which includes the West Bank and Gaza Strip. That’s the reason. As part of the Oslo peace process in 1994, a customs arrangement was established between Israel and the Palestinian National Authority regarding goods going into and out of the West Bank and the Gaza Strip. Canada and the Palestinian National Authority, through the Joint Canadian-Palestinian Framework for Economic Cooperation and Trade between Canada and the Palestinian Liberation Organization, referred to the customs arrangement between Israel and the Palestinian National Authority and recognize CIFTA’s application to goods originating from or destined to the West Bank and the Gaza Strip. Mr. Carr, Senate of Canada, Proceedings of the Standing Senate Committee on Foreign Affairs and International Trade, Issue No. 62, Evidence, Meeting of May 1, 2019.

[48] State of Palestine, Ministry of Foreign Affairs and Expatriates, “Position Paper: Canada-Israel Free Trade Agreement (CIFTA),” provided to CJPME in 2022, https://assets.nationbuilder.com/cjpme/pages/7341/attachments/original/1694031006/CIFTA_position_paper_-_Palestinian_Authority.pdf?1694031006

[49] State of Palestine, Ministry of Foreign Affairs and Expatriates, “Position Paper: Canada-Israel Free Trade Agreement (CIFTA),” provided to CJPME in 2022, https://assets.nationbuilder.com/cjpme/pages/7341/attachments/original/1694031006/CIFTA_position_paper_-_Palestinian_Authority.pdf?1694031006

[50] As noted by Lynk, the text of the Paris Protocol has only one mention of “settlements,” which is related to the collection of taxes from Palestinian workers in settlements. Michael Lynk, Associate Professor, Faculty of Law, Western University, as an individual, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019.

[51] Michael Lynk, Associate Professor, Faculty of Law, Western University, as an individual, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019; “Protocol on Economic Relations between the Government of the State of Israel and the P.L.O., representing the Palestinian people,” https://unctad.org/system/files/information-document/ParisProtocol_en.pdf.

[52] United Nations Economic and Social Commission for Western Asia, “Countering economic dependence and de-development in the occupied Palestinian territory,” October 2022, https://www.un.org/unispal/wp-content/uploads/2023/03/ESCWAREPORT_280223.pdf

[53] B’Tselem, “The Paris Protocol,” last updated September 19, 2012, https://www.btselem.org/freedom_of_movement/paris_protocol

[54] BDS Movement, “Palestinian Civil Society Call for BDS,” July 9, 2005, https://bdsmovement.net/call

[55] BDS Movement, “Palestinian Trade Unions' Anti-Apartheid Call,” April 10, 2023, https://bdsmovement.net/news/palestinian-trade-unions-anti-apartheid-call

[56] Art Eggleton, House of Commons Debate, Wednesday October 9, 1996.

[57] State of Palestine, Ministry of Foreign Affairs and Expatriates, “Position Paper: Canada-Israel Free Trade Agreement (CIFTA),” provided to CJPME in 2022, emphasis in original, https://assets.nationbuilder.com/cjpme/pages/7341/attachments/original/1694031006/CIFTA_position_paper_-_Palestinian_Authority.pdf?1694031006

[58] As explained by Troy Lulashnyk of Global Affairs Canada: “We continue to have trade with the Palestinians. They have their trade statistics on how much that is, and we have ours. The numbers are fairly different in terms of how you evaluate it, but we do assess each year and continue to try to grow that relationship. There are some statistics that we use, and we are able to say that we have this trade relationship that has benefited from CIFTA, from the signature to where we are today. As this relationship develops and as CIFTA is implemented, we’ll be in a position to show the [data], or how the modernized CIFTA has enhanced or accelerated trade with the Palestinians.” Mr. Lulashnyk, Senate of Canada, Proceedings of the Standing Senate Committee on Foreign Affairs and International Trade, Issue No. 61, Evidence, Meeting of April 10, 2019.

[59] State of Palestine, Ministry of Foreign Affairs and Expatriates, “Position Paper: Canada-Israel Free Trade Agreement (CIFTA),” provided to CJPME in 2022, https://assets.nationbuilder.com/cjpme/pages/7341/attachments/original/1694031006/CIFTA_position_paper_-_Palestinian_Authority.pdf?1694031006

[60] Trade Map (International Trade Centre), “Bilateral trade between Palestine, State of and Canada,” accessed July 2023. Imports (from Canada): https://www.trademap.org/Bilateral_TS.aspx?nvpm=1%7c275%7c%7c124%7c%7cTOTAL%7c%7c%7c2%7c1%7c1%7c1%7c2%7c1%7c1%7c1%7c1%7c1; Exports (to Canada): https://www.trademap.org/Bilateral_TS.aspx?nvpm=1%7c275%7c%7c124%7c%7cTOTAL%7c%7c%7c2%7c1%7c1%7c2%7c2%7c1%7c1%7c1%7c1%7c1

[61] Government of Canada, “Canada-Israel fact sheet,” as of November 27, 2022. See archived web version: https://web.archive.org/web/20221127130800/https://www.international.gc.ca/country-pays/fact_sheet-fiche_documentaire/israel.aspx?lang=eng

[62] Note: This comparison only allows us to provide an estimate. Given the opaqueness of Canada’s reporting practices, this approach is potentially flawed. One limitation of this comparison is that Canada’s reported statistics for trade with Israel may include trade with Palestine, or alternatively, Canada might keep the whole or part of those values separate and unreported. Therefore, this estimate may ‘count’ the values for trade with Palestine twice. An alternative methodology would be to subtract the values reported by Palestine from Canada’s reported trade with Israel, and then compare those two numbers, but this would assume that the values of Palestine are fully reported as trade with Israel. CJPME has approached the Canadian government for clarity on its reporting measures but has not received a response, despite reaching out to diplomats, trade commissioners, Global Affairs Canada, and staff in the office of the Trade Minister. Ultimately, however, the figures of Canada-Palestine trade are so low that it does not make any meaningful difference for understanding the overall asymmetry of Canada-Palestine vs. Canada-Israel trade.

[63] In the same period, Canada imported over $200m from Myanmar, compared to $3m from Palestine. Government of Canada, “Canada-Myanmar relations,” last modified August 11, 2023, https://www.international.gc.ca/country-pays/myanmar/relations.aspx?lang=eng

[64] Government of Canada, “Canada-Yemen relations,” last modified September 6, 2022, https://www.international.gc.ca/country-pays/yemen/relations.aspx?lang=eng

[65] Times of Israel, “Israel’s population nears 10 million, a 12-fold increase since state’s 1948 founding,” April 24, 2023, https://www.timesofisrael.com/israels-population-nears-10-million-a-12-fold-increase-since-states-1948-founding/

[66] Human Rights Watch, “A Threshold Crossed: Israeli Authorities and the Crimes of Apartheid and Persecution,” April 27, 2021, https://www.hrw.org/report/2021/04/27/threshold-crossed/israeli-authorities-and-crimes-apartheid-and-persecution

[67] Government of Canada, “Canada-Israel Free Trade Agreement,” last modified October 17, 2022, https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/israel/fta-ale/index.aspx?lang=eng

[68] United Nations Economic and Social Commission for Western Asia, “Countering economic dependence and de-development in the occupied Palestinian territory,” October 2022, https://www.un.org/unispal/wp-content/uploads/2023/03/ESCWAREPORT_280223.pdf

[69] United Nations Conference on Trade and Development (UNCTD), “Economic costs of the Israeli occupation for the Palestinian people: the toll of the additional restrictions in Area C, 2000–2020,” November 22, 2022, https://unctad.org/news/economic-restrictions-west-bank-exact-50-billion-toll-between-2000-and-2020

[70] United Nations Conference on Trade and Development (UNCTD), “The Economic Costs of the Israeli Occupation for the Palestinian People: Impoverishment of Gaza under Blockade,” December 15, 2020, https://unctad.org/publication/economic-costs-israeli-occupation-palestinian-people-impoverishment-gaza-under-blockade

[71] United Nations Economic and Social Commission for Western Asia, “Countering economic dependence and de-development in the occupied Palestinian territory,” October 2022, https://www.un.org/unispal/wp-content/uploads/2023/03/ESCWAREPORT_280223.pdf

[72] Government of Canada, “Canada-Israel Free Trade Agreement,” last modified October 17, 2022, https://www.international.gc.ca/trade-commerce/trade-agreements-accords-commerciaux/agr-acc/israel/fta-ale/index.aspx?lang=eng; Government of Canada, “Canada-Israel Free Trade Agreement Modernization Negotiations: Final Environmental Assessment Report - January 2016,” last modified March 31, 2017, https://www.international.gc.ca/trade-agreements-accords-commerciaux/env/final_ea_canada-israel_ee.aspx?lang=eng

[73] Peace Now, “Population,” accessed July 11, 2023, https://peacenow.org.il/en/settlements-watch/settlements-data/population

[74] Michael Lynk, Associate Professor, Faculty of Law, Western University, as an individual, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019.

[75] Stefan Christoff and Stuart Trew, “Canada must cancel its free trade deal with Israel,” The Monitor (Canadian Centre for Policy Alternatives), March 22, 2023, https://monitormag.ca/articles/canada-must-cancel-its-free-trade-deal-with-israel/; Montreal Artists and Academics, “Artists and Academics in Montréal Oppose Canada-Israel Free Trade Agreement in Stand for Palestinian Rights,” January 8, 2021, https://bdsmovement.net/news/artists-and-academics-montreal-oppose-canada-israel-free-trade-agreement-stand-for-palestinian

[76] Recommendation from NCCAR as read by Mr. Flis, Standing Committee on Foreign Affairs and International Trade, Meeting No. 49, Tuesday, October 29, 1996.

[77] Benoît Sauvageau (BQ MP), House of Commons Debate, Tuesday November 5, 1996.

[78] Mr. Pierre Paquette (BQ MP), House of Comments debates, April 10, 2002, 37^th Parliament, 1^st session.

[79] Bloc Québécois, Plateforme électorale, campagne 2005-2006, https://www.poltext.org/sites/poltext.org/files/plateformesV2/Canada/CAN_PL_2006_BQ.pdf

[80] Tracey Ramsey (NDP MP) proposed an amendment that: “In the interests of transparency, product labelling must accurately reflect the precise place of origin of any product that originates in an area that is occupied by the State of Israel but that is outside the territory of the State of Israel as it existed on June 4, 1967. In particular, labelling must indicate whether the product was made in an illegal settlement, and whether it was made in the West Bank, East Jerusalem, Golan Heights or Gaza.” House of Commons Standing Committee on International Trade, Thursday, November 29, 2018.

[81] Gabriel Ste-Marie (BQ MP) proposed an amendment that: “For greater certainty, despite paragraph (b) of the definition territory in Article 1.7 of the Agreement, this Act and the Agreement apply to the territory of the State of Israel except for any territory administered by that State since June 4, 1967.” House of Commons Standing Committee on International Trade, Thursday, November 29, 2018.

[82] Michael Lynk, Associate Professor, Faculty of Law, Western University, as an individual, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019.

[83] Joint letter to the Senate, “Re: Canada Israel Free Trade Agreement – Bill C-85 Implementation Act,” March 27, 2019, https://quakerservice.ca/wp-content/uploads/2019/03/Joint-Letter-Bill-C-85-CIFTA.pdf

[84] Alex Neve, Secretary General, Amnesty International Canada, Senate of Canada, Evidence, Standing Senate Committee on Foreign Affairs and International Trade, Meeting of May 2, 2019.

[85] Green Party of Canada, “Measures to pressure the government of Israel to preserve the two-state solution: addendum to current Middle East policy,” adopted 2016, https://www.greenparty.ca/en/sgm-2016/voting/resolutions/s16-p013

[86] CJPME, “CJPME Applauds NDP for Adopting Bold Sanctions Policy on Israel,” April 10, 2021, https://www.cjpme.org/pr_2021_04_10_ndp_convention

[87] Amnesty International Canada, “Canada must recognize the human rights implications of CIFTA,” March 20, 2019, https://thewallwillfall.ca/canada-must-recognize-the-human-rights-implications-of-cifta/

[88] Submission of the United Church of Canada to Consultations on the Canada-Israel Free Trade Agreement, May 2013, https://united-church.ca/sites/default/files/unsettling-goods-cifta.pdf

[89] Canadian Friends of Peace Now, “Canada-Israel Free Trade Agreement: A gift to settlers?,” https://www.peacenowcanada.org/newsletter/canada-israel-free-trade-agreement-a-gift-to-settlers/

[90] Joint letter to the Senate, “Re: Canada Israel Free Trade Agreement – Bill C-85 Implementation Act,” March 27, 2019, https://quakerservice.ca/wp-content/uploads/2019/03/Joint-Letter-Bill-C-85-CIFTA.pdf

[91] Joint letter to the Senate, “Re: Canada Israel Free Trade Agreement – Bill C-85 Implementation Act,” March 27, 2019, https://quakerservice.ca/wp-content/uploads/2019/03/Joint-Letter-Bill-C-85-CIFTA.pdf

[92] Stefan Christoff and Stuart Trew, “Canada must cancel its free trade deal with Israel,” The Monitor (Canadian Centre for Policy Alternatives), March 22, 2023, https://monitormag.ca/articles/canada-must-cancel-its-free-trade-deal-with-israel/

[93] National Council of Canadian Muslims (@nccm), Tweet, “3/3. Canada must now take action to stand in solidarity with human rights, including banning settlement products and recognizing the jurisdiction of the International Criminal Court so that human rights violators in the region can be appropriately investigated and prosecuted,” April 5, 2023, https://twitter.com/nccm/status/1643676545272229888?s=20

[94] “Open Letter: End Annexation & the Canada-Israel Free Trade Agreement,” IJV Canada, July 23, 2020, https://www.ijvcanada.org/open-letter-end-annexation-the-canada-israel-free-trade-agreement/

[95] Canada has “placed sanctions on the Russian-occupied Crimea region of Ukraine and on Ukrainian individuals and entities related to Russia’s illegal occupation and attempted annexation of Crimea and the ongoing Russian occupation in parts of eastern Ukraine.” This includes asset freezes and prohibition on dealing with prohibited persons and entities, and prohibitions on trade (imports and exports), investment and services. See Government of Canada, “Canadian Sanctions Related to Ukraine,” last modified July 13, 2023, https://www.international.gc.ca/world-monde/international_relations-relations_internationales/sanctions/ukraine.aspx?lang=eng

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