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Ikea sees a market in the modern Palestinian family

July 26, 2013
July 26, 2013

Ikea is looking to set up in Ramallah, making the furniture and housewares retailers among the first multinationals to operate in the Palestinian territories.

Located only 10 kilometers from Jerusalem in the central West Bank, Ramallah is among the more liberal areas of Palestine, with numerous nightclubs and bars filled with aid workers and diplomats. Nearly two dozen embassies have set up in the city.

Local demographics are shifting as well, and the middle-class city is home to a nascent tech boom. The newspaper Haaretz says nuclear families rather than extended families are becoming the norm, which helps explain Ikea’s appeal. “Many are moving to apartments, and IKEA is definitely relevant to the Palestinian public,” a business leader told Haaretz.

But the Swedish retailer would be within a minority. Among the few international businesses operating in Ramallah is the hotel chain Mövenpick, suggesting the sensitive nature of launching within Palestine.

Ikea has been discussing the possibility of launching in Ramallah (paywall) with the Palestinian Authority for several months, and the PA’s economic minister, Jawad al-Naji, has given the project his full backing. The project has also received support from businesses within the territories, with suggestions that there are many investors who would look to invest in the company (paywall), should they decide to launch in Ramallah. Ikea did not respond to a call for comment.

This is not Ikea’s first foray into the Middle Eastern market. In addition to stores in Saudi Arabia, Qatar and Kuwait, Ikea has two branches in Israel—one in Netanya and one in Rishon Letzion. Ikea Israel (a separate entity from Ikea Global) has offered to train staff in the new training complex in Netanya, should the deal to launch in Ramallah go through.

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