An Evaluation of the Competitiveness of the Palestinian Olivewood Industry in Bethlehem Governorate

Suhair Abdallah Elias Ishaq
سهير عبد الله إلياس اسحق
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Al-Quds University
Olivewood carving is one of the most vital Palestinian handicrafts with the most significant profit margin. Bethlehem, Beit Jala, and Beit Sahour are the primary three cities famous in the governorate are specialized in producing and designing olivewood carving products. The olivewood industry is part of the Palestinian handicraft sector. It is also part of the tourism sector. Therefore, changes in the tourism sector translate directly into the handicraft sector. As such, unstable political situations affect the olivewood industry negatively. In order to enhance development and sustainability, it is essential that the olivewood workshops must increase the cooperation between them and with other stakeholders in the industry. Based on Porter‘s theory of competitive advantage, the main determinants of competitive advantage are; factor conditions, demand conditions, related and supporting industries, firm strategy, structure, and rivalry, chance and the role of the government. The main objective of the study is to increase the understanding of the determinants of the competitiveness of the olivewood industry by applying Porter‘s diamond model to specify other factors than those suggested in the diamond model that could influence the competitiveness of the olivewood industry. The research followed a descriptive survey approach. An in-depth interviews and structured questionnaire were utilized to gather data. The questionnaire targeted 110 owners of olivewood workshops in Bethlehem governorate. The questions were organized to achieve the objectives of the research. The results obtained from the survey were iv summarized, and results were analyzed using the descriptive analysis. Percentages and trends were displayed in tables. To measure the spread of the data over the sample population, mean scores and standard deviations were calculated. Correlation coefficients between indicators of innovation and attributes of the diamond were calculated to analyze the magnitudes of the relationship between them. The study revealed that although olivewood industry has stable factor conditions, steady local demand under unstable political conditions, artisan‘s attempts to develop and innovate. However, they are not sufficient for deriving and sustaining competitive advantage in the domestic and international markets. Based on the diamond model, a primary recommendation that could alleviate weaknesses related to marketing, competition, capacity building, quality and price control, and other issues is to establish an effective and powerful institution that can lead and improve the olive wood industry. Besides, an increase of the cooperation among stakeholders in the olivewood industry, directing the government policies, would attract investments, in the olivewood cluster.