Sodastream closes its West Bank factory: Can you now drink their seltzer guilt-free?

SodaStream Is Shutting Down Its West Bank Factory

SodaStream Is Shutting Down Its West Bank Factory

Moneybox
A blog about business and economics.
Oct. 29 2014 5:57 PM

SodaStream Is Shutting Down Its West Bank Factory

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Palestinian workers at the SodaStream factory in the Mishor Adumim industrial park, next to the West Bank settlement of Ma’aleh Adumim.

Photo by Menahem Kahana/AFP/Getty Images

SodaStream announced today that the company will close its controversial factory located on a West Bank settlement—the focus of an international boycott campaign. The company will move the plant's operations to a new location in southern Israel by late 2015. This is pleasant news for guilt-ridden liberals who also happen to be SodaStream fans, and (far more importantly) it's a small victory for Palestinians who would prefer not to live in an occupied territory.

SodaStream's defenders have pointed out that its factory employed some 500 Palestinians out of roughly 1,300 workers. But by locating in the West Bank—which critics say made it eligible for tax breaks as well as cheap land—the company helped anchor the settlements. As the Jewish Daily Forward explained it:

SodaStream’s factory is not located in a radical settlement; it is located a 10-minute drive from Jerusalem in an industrial park next to one of the largest settlement blocs—Ma’aleh Adumim—which will likely be incorporated into Israel in any future deal. But it does exploit the commercial benefits of its location, essentially profiting from occupation, and contributes to the slow closing of the E1 corridor that is necessary for the contiguity of a future Palestinian state.   

Over time, the brand has been engulfed by controversy over the plant. Actress Scarlett Johansson had to step down as an ambassador for the humanitarian group Oxfam International, which is against trade with West Bank settlements, after she became a pitchwoman for SodaStream. According to the Wall Street Journal, "Online calls to boycott the company’s products have more than doubled since 2013 and represented 29% of SodaStream’s brand conversations on the Internet between July and October." In a remarkable act of corporate plainspeak, CEO Daniel Birnbaum eventually called the factory "a pain in the ass" and said with hindsight he "never" would have opened it. 

Perhaps today's announcement will offer a little pain relief. And what of the plant's current workers? According to the WSJ, Birnbaum says SodaStream "will try to secure Israeli work permits for Palestinians" at the new site, which is about 60 miles from the West Bank factory. That's a long commute. But this seems like it might be a win-win for all involved.  

Jordan Weissmann is Slate’s senior business and economics correspondent.