Israeli high-tech companies are turning their backs on traditional outsourcing hubs India and China and finding new engineers to do their programming – Palestinians. Aside from reducing costs, many regard it as an investment in peace.

Israel is second only to California’s Silicon Valley for high-tech innovation and arguably it’s the best in the world for high-tech research and development. To be more competitive, Israelis like their American counterparts, are now outsourcing programming jobs to people in India and China.

Recently a new trend has started: Israeli companies and branches of multinational companies in Israel are outsourcing work to Palestinians. While the thought of outsourcing to Palestinians might not have seemed plausible at first due to security concerns, after trying the idea out, Israelis are finding it a superior solution for many reasons.

Every year about 3,000 Palestinian computer scientists graduate from one of 11 Palestinian-run universities, but even with a degree there is no guarantee of finding a good job.

“We realized that instead of fighting each other and throwing bombs we needed to work together,” said Jonathan Levy a general manager for the chip manufacturer Winbond, in Israel: “I started thinking that it would be better to hire a Palestinian engineer to develop our less complex products, for reasons related to cost calculations as well as problems of language, culture and deadlines,” he said in a local newspaper.

During a meeting of the Young Presidents’ Organization, an international organization of 20,000 company directors, Levy was introduced to Murad Tahboub, the managing director of Asal Technologies, in Ramallah, who manages a team of about 35 full-time and 12 part-time Palestinian programmers.

Today, seven Palestinian engineers work for Winbond out of Ramallah; Tahboub’s team has also completed jobs for the Israeli firm G.ho.st (Global Hosted Operating System). See related story: Israeli startup promises a virtual OS – and real coexistence.

The cooperation sets the pace for building peace

At a third of the cost of an Israeli engineer, Tahboub told ISRAEL21c: “We have a viable commercial business proposal. Why an Israeli would work with us is based purely on commercial reasons.”

Cost-effective labor, working in the same time zone, a workforce with a good command of the English language and high productivity rates, make Palestinian programmers desirable, but not just for Israelis, but any multinational company, says Tahboub.

There is also a familiarity between the two cultures, which can increase trust and confidence between the outsourcer and the outsourcee says Tahboub: “Come on guys. We know each other’s holidays, we known each other’s taboos and we know each other’s sensitive issues. Plus we are using the same currency,” he adds.

“When we sign long-term contracts with each other, no one will be surprised by a fluctuating dollar rate. Working with Palestinians gives Israelis a more secure fiscal risk,” he adds.

Boasting professors trained at Harvard, Yale, Cambridge, and MIT, or McGill in Canada, Tahboub says Palestinians provide the same skill sets as Israeli engineers. He is hoping more companies will consider working with Palestinians because more jobs can only increase the chances for peace in the region.

“But not only in Palestine but in all areas where there is political instability,” says Tahboub, who studied at an American college in Europe: “If people have good jobs, if their kids are getting an education, if there is good medical treatment and retirement plans, then they would not think radically, and would try to improve what they have.”

Hiring Palestinian engineers Tahboub concludes, “is an investment in peace.”