The East Jerusalem Tourism Industry, a Casualty of Israel’s War on Gaza

Margo Tarazi, manager of the Universal Tourism Agency in East Jerusalem, has always followed Palestinian national protest calls. But in the days following the October 7 events in and around Gaza, she was faced with a dilemma: How could she go on strike while she was responsible for tourists who were stranded when Israel declared war on Gaza and the airport partially shut down?

Margo and her brother Samer come from a well-known Palestinian family from Gaza. Her relatives and her heart were with her family. Her father, Naim Tarazi, and her uncle, Zuhdi Tarazi, are well-known patriotic icons: Her father was a leading figure in the tourism industry and a well-respected member of the Orthodox Church community, and her uncle was the Palestine Liberation Organization (PLO) ambassador to the United Nations from 1974 to 1991.

Margo decided to go to work, but discreetly. She shut the doors of their agency on Salah al-Din Street and worked quietly to ensure the safety of her tourists and their refund for services not used because their tours were cut short.

Sami Abu Dayyeh had a similar dilemma. He and his family own and run several hotels with many Palestinian employees. He cannot keep his hotels open and pay the staff if he has no guests, yet he is reluctant to take measures that negatively impact his employees. Sami decided to keep his anchor hotel, the Ambassador Hotel in the Palestinian neighborhood of Sheikh Jarrah, open; as for his other hotels in Jerusalem and Bethlehem, he gave his staff a vacation. The Jerusalem staff pay a hefty social security insurance premium, and he hoped they might be able to apply for partial unemployment.

The Ambassador Hotel is considered one of the places most preferred by Palestinian Jerusalemites to hold their meetings, have a meal, or spend a relaxing time. Its easy access also makes it one of the favorite hotels for foreign tourist delegations.

Sami told Jerusalem Story that the hotel was just beginning to recover recently from the setback in tourism caused by the COVID-19 disease. Recently, however, the number of tourists increased dramatically; all hotels in East Jerusalem were completely booked for several months. Sami and other workers in the tourism sector in Palestine began to breathe a sigh of relief.

But then the war on the Gaza Strip began, which led to the cancellation of tourist delegations’ reservations for the coming months, the hermetic closure of Jerusalem and the Old City, and the consequent complete paralysis of the Old City, which depends on tourism. The population of the Old City is 90 percent Palestinian.

The ever-smiling Sami admits his frustration. “All reservations in this hotel and in the other hotels that I manage have been canceled until next December. This has forced the closure of all Ambassador Hotels in Jerusalem and Bethlehem.”1 Sami also had to close the old Ritz Hotel in Jerusalem.

The Ambassador Hotel is still open, but only half its rooms are reserved, mainly by foreign journalists who came to cover Israel’s war on the Gaza Strip.

Like Sami, Raed Saadeh was also pessimistic. Raed is the owner of the Jerusalem Hotel and the executive director of the Jerusalem Tourism Cluster, the nonprofit network of sectors (hotels, restaurants, tour agencies) connected directly or indirectly to the tourism industry. In an interview with Jerusalem Story, Raed was pessimistic about the prospects for tourism in the city in the near future. “Not only do we have canceled tours, but most airlines have also stopped flying into the Lydda [Tel Aviv] airport, because of the hostilities in Gaza.”2 He was referring to rockets launched from Gaza targeting the airport, which caused a temporary stoppage of flights at Israel’s main airport hub.

Ihab al-Jabari, who worked for years in the tourism sector and managed the Holy Land Incoming Tour Operators Association, told Jerusalem Story that, according to the association’s latest statistics, the loss of incoming tourism offices in October amounted to more than $20 million as a result of canceling the reservations of more than 2,400 tourist delegations who were planning to visit Israel and Palestine. Most of the incoming tourists stay in Jerusalem and Bethlehem; tour cancelations affect hotels, restaurants, buses, guides, and even souvenir shops, all of which have completely stopped working. Domestic tourism to Palestinian cities has also come to a halt.

According to al-Jabari, most of the restaurants in Ramallah and Bethlehem have stopped operating due to the absence of customers from Jerusalem and Palestinians from within Israel. (Israel closed the checkpoints around Palestinian cities, closing them hermetically to Palestinians.)

Al-Jabari noted that the crisis—one can even call it an economic catastrophe—the tourism sector in Palestine is experiencing is the absence of government support for all workers in this sector. Israel, by contrast, compensates all those affected by the drop in tourism.

While tourists and pilgrims are nowhere to be found, a strange phenomenon has been noticed in recent days. On Salah al-Din Street, a tourist bus stopped, and several tourists got off. By their looks and attire, they appeared to be from Southeast Asia. When asked, the driver, who requested that his name not be mentioned, said that he had brought this delegation of Malaysian Muslims from Jordan, crossing the King Hussein Bridge. They planned to stay for up to three days with the hope of visiting Jerusalem’s iconic Haram al-Sharif/al-Aqsa Mosque and the Ibrahimi Mosque in the city of Hebron if possible.

Tony Khashram, a certified tourism consultant, said that he was personally responsible for this delegation and had not coordinated their trip with tourism companies; he described the current tourism situation as catastrophic in every sense of the word. The disaster does not stop with direct tourism service providers such as hotels, but rather extends to indirect providers who have stopped working completely, and their unemployment is very high. This unemployment will rise to unprecedented levels in the coming months.

Tony, who has served as former president of the Inbound Tourism Association, says that, for the most part, revenue in Jerusalem depends on incoming tourism; it is the backbone and lifeline of the East Jerusalem economy. He completed a study in February 2023 that looked at the tourism industry since the start of 2022, when it was beginning to recover after the closure caused by a two-year pandemic. He is convinced that Jerusalemites need inbound tourism for stability, steadfastness, and the ability to remain in the city. When incoming tourism slows down or stops, all Palestinian businesses suffer.

To help explain the effect of a drop in tourism on the Palestinian economy, consider these data provided in Tony’s study:3

Tony told Jerusalem Story:

Tony observes that almost every home in Jerusalem was affected by the disaster that struck the tourism sector in the Old City. “No one knows what the conditions will be like soon, and we have no help at all. What can we do? We are waiting for relief.”

Margo insists that no matter what happens, she will not quit or give up. “We have weathered the COVID-19 pandemic, and our company has weathered losing our major Russian pilgrims since the beginning of the Russia-Ukraine War, and we survived. It will be hard, but we will survive and rebound.”5