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Gaza Pepsi Factory Shuts down, Owners Blame Israeli Restrictions

A Palestinian man walks past Gaza Pepsi factory for soft drinks in Gaza City June 21, 2021. (Reuters)
A Palestinian man walks past Gaza Pepsi factory for soft drinks in Gaza City June 21, 2021. (Reuters)
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Gaza Pepsi Factory Shuts down, Owners Blame Israeli Restrictions

A Palestinian man walks past Gaza Pepsi factory for soft drinks in Gaza City June 21, 2021. (Reuters)
A Palestinian man walks past Gaza Pepsi factory for soft drinks in Gaza City June 21, 2021. (Reuters)

Gaza's Pepsi bottling company was forced to halt operations this week due to Israeli import restrictions that were tightened during an 11-day conflict between Israel and Palestinian militants last month, the company's owners say.

With a truce between Israel and Gaza's Hamas largely holding, Israel on Monday allowed a limited resumption of exports from the enclave.

But it has kept in place tightened measures on raw material imports, including carbon dioxide gas and syrup that the bottling company's factory needs to produce Pepsi, 7UP and Mirinda soda, said Pepsi Gaza's Hamam al-Yazeji.

"Yesterday, we completely ran out of raw materials, and unfortunately we had to shut down the factory, sending home 250 workers," Yazeji said. Before the May fighting, he said, Pepsi Gaza was generally allowed to import needed materials.

Israeli officials did not immediately provide comment on the tightened restrictions.

Israel and neighboring Egypt keep tight control over Gaza's borders, and say the restrictions are necessary to stop weapons reaching Hamas and prevent them from being produced locally.

Egypt and the United Nations stepped up mediation last week after incendiary balloons launched from Gaza drew retaliatory Israeli air strikes on Hamas sites, challenging the fragile ceasefire.

Shutdowns could also occur in other Gaza factories if Israeli restrictions are kept up, analysts say. Manufacturing makes up around 10 percent of Gaza's service sector-dominated economy, according to UN data.

Pepsi Gaza's factory has operated continuously since 1961, when the Gaza-based Yazeji Soft Drinks Company acquired rights to produce 7UP and other types of soda in the enclave.

Worth about $15 million, the owners say, the factory's products are distributed locally. A separate branch operates in the occupied West Bank, worth about $30 million, which serves the territory as well as East Jerusalem.

Company officials had made plans to celebrate 60 years of operations before the shutdown on Sunday.

Yazeji had tears in his eyes as he walked through his empty factory on Monday. The shutdown was "catastrophic", he said.

"This year should have been exceptional, celebrating 60 years since we began production.

"We are deprived of marking this anniversary."

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What’s Behind the UNIFIL Attacks?

FILED - 26 August 2023, Lebanon, Kfrachouba: UN peacekeeping troops secure the Lebanese border side with Israel at the outskirts of the Lebanese southern village of Kfarchouba. Photo: Marwan Naamani/dpa
FILED - 26 August 2023, Lebanon, Kfrachouba: UN peacekeeping troops secure the Lebanese border side with Israel at the outskirts of the Lebanese southern village of Kfarchouba. Photo: Marwan Naamani/dpa
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What’s Behind the UNIFIL Attacks?

FILED - 26 August 2023, Lebanon, Kfrachouba: UN peacekeeping troops secure the Lebanese border side with Israel at the outskirts of the Lebanese southern village of Kfarchouba. Photo: Marwan Naamani/dpa
FILED - 26 August 2023, Lebanon, Kfrachouba: UN peacekeeping troops secure the Lebanese border side with Israel at the outskirts of the Lebanese southern village of Kfarchouba. Photo: Marwan Naamani/dpa

Efforts to restore state authority across Lebanon and enforce UN Security Council Resolution 1701 - which mandates a zone free of unauthorized weapons south of the Litani River - have been met with fresh hostilities targeting UN peacekeepers in the country’s southern border areas.

In recent days, attacks on the United Nations Interim Force in Lebanon (UNIFIL) have resurfaced, echoing tactics previously used by Hezbollah to send political messages.

The latest incident occurred on Tuesday in the southern town of Bint Jbeil, where local residents reportedly blocked a UNIFIL patrol from entering without a Lebanese army escort.

On Friday, two young men in the town of Tayr Debba obstructed an armored UNIFIL convoy, forcing it to withdraw. A widely circulated video showed one of the men stating: “They’re not allowed to enter without the Lebanese army.”

Sources at the Presidential Palace told Asharq Al-Awsat that President Joseph Aoun raised the issue during a recent meeting with UNIFIL Commander Lieutenant General Aroldo Lázaro.

The president underscored the need for close coordination between UNIFIL and the Lebanese army to avoid friction with residents. The army, the sources added, is actively addressing such incidents to prevent escalation.

Government officials condemned the attacks as “unacceptable,” recalling Aoun’s firm stance two months ago when UNIFIL forces were assaulted near Beirut airport. At the time, Aoun described such acts as “reprehensible and condemned.”

Investigations into the Beirut airport incident led to the arrest of 25 individuals, of whom 19 were later released, while six remain under military court jurisdiction.

“Any grievances should be relayed to the army, which is deployed in these areas,” a senior source told Asharq Al-Awsat.

The source warned that repeated disruptions could strain the vital relationship between peacekeepers and the local community. “Residents benefit from UNIFIL not only in terms of security, but also through social and humanitarian services,” the source added.

Political undertones are also suspected. Despite unified pledges from Aoun, Prime Minister Nawaf Salam, and Parliament Speaker Nabih Berri to uphold Resolution 1701 and stabilize the south, the nature of the attacks suggests a deliberate attempt to undermine these efforts.

“It’s puzzling,” the source said. “Clearly, a certain party is working to disrupt the relationship with UNIFIL - it’s as if someone is singing a different tune.”

Asked whether such incidents could hinder UNIFIL’s operations, the source responded: “The peacekeepers know these acts are not state-sanctioned. The Lebanese government is dealing with them. But if they continue, participating countries might reconsider their involvement.”

Riad Kahwaji, head of the Institute for Near East and Gulf Military Analysis (INEGMA), squarely blamed Hezbollah for orchestrating the confrontations.

“Hezbollah has long used civilians to harass UNIFIL as a form of messaging,” Kahwaji told Asharq Al-Awsat. “It’s a tactic to assert dominance, especially now that Lebanese leaders are signaling a shift toward disarming the group. These are Hezbollah’s reminders that it still controls the ground.”

“No one in these villages acts without Hezbollah’s directives,” he added, dismissing claims of spontaneous civilian protests as a cover.

Kahwaji warned that unless the government acts swiftly to detain perpetrators and prevent further escalation, the attacks may intensify and even target the Lebanese army, which is expanding its presence in the south.

UNIFIL deputy spokesperson Kandice Ardiel, responding to Friday’s incident, reaffirmed that the peacekeeping force is operating in close coordination with the Lebanese Armed Forces to support the Lebanese government’s implementation of Resolution 1701 during this critical period.