RAMALLAH — Palestinians are turning to their fledgling high-tech sector as they lay the groundwork for a future state, saying the unique hardships of life in the West Bank have fostered a creative spirit conducive to the world of startups. Dozens of high-tech hopefuls recently competed for the honor of having the best business idea at the West Bank's premier startup conference. Just a few kilometers away, Palestinian youths clashed with Israeli security forces at a military checkpoint on the outskirts of occupied Jerusalem. Despite the unrest nearby, the scene at the conference was more reminiscent of Silicon Valley. Casually dressed young men and women in headscarves and skinny jeans gathered in groups to discuss ideas for innovative products and services. Palestinians charge that Israel has restricted their economy with checkpoints and other limitations, citing security needs, but ideas don't stop at military checkpoints and border crossings, said George Khadder, one of the conference's organizers and chief marketing officer at the startup company, Yafa Energy. "All you need is a brain, a computer and an Internet connection." Organizers said the goal was to encourage the entrepreneurial spirit and lay a foundation for a thriving high-tech industry. In particular, they want to move beyond traditional low-margin outsourcing work and create Palestinian companies with original ideas and products. "Outsourcing is important. It will create a platform for hiring employees who might at some point leave the company and start their own firms, but it cannot be the strategic advantage of Palestine," said Khadder, co-founder of Peeks, a grassroots organization that promotes technology and got its name from the phrase "Palestinian geeks." "What Palestinians need in the tech sector ... is to create their own intellectual property, their own products and services that can be sold over the Internet," Khadder said. The Palestinians, who want to see the West Bank and east Jerusalem as part of a future independent state, think they are uniquely positioned to make a push into technology. Palestinian society puts a premium on higher education and Israeli travel restrictions that have historically hindered the West Bank economy have also fostered Internet use. Palestinians have one of the highest rates of Internet use in the Arab World. A 2012 study on social media use in the Arab world, conducted by the Dubai School of Government for instance, ranked Palestinians third in Facebook use after Lebanon and Kuwait. While the Palestinian tech industry is still in its infancy, it has been heavily influenced by Israel, a global technology powerhouse. The Palestinians import about $22 million in information-technology services from Israel, according to Sabri Saidam, a tech adviser to Palestinian President Mahmoud Abbas. And dozens of Palestinian firms perform outsourcing work for Israeli-based companies, making technology a rare area of cooperation between the sides. During the 54-hour technology marathon earlier this month, young Web developers, designers, computer science students and entrepreneurs pitched products related to job recruiting and music to a university notes-sharing system. There was an idea for a system that would remotely connect psychologists to people with low mobility, like women in the Arab Gulf. Another participant proposed a game starring a character — donning a Palestinian kaffiyeh, or checkered headdress, around his neck — who jumps over Israel's West Bank separation barrier. The goal of the game is to reach Jerusalem, which is off-limits for most Palestinians and requires a special Israeli permit. For all, the dream is to replicate the success of Yamsafer and Souktel, successful Palestinian startups that have raised $1 million in venture capital. Both have been financed by Sadara Ventures, the first information technology-focused venture capital firm in the Palestinian territories. According to official Palestinian government statistics, about 250 Palestinian firms are working in the information and communication technology sector, generating about 6.1 percent of Palestinian economic activity in 2011. Although the numbers are skewed by the outsized influence of local telecom PalTel, the tech sector nonetheless is now larger than the agriculture sector, which historically has been a mainstay of the local economy. — AP
