The French companies involved in the Jerusalem light rail project, among them Alstom and Veolia, are having to contend with heavy pressure from Arab countries because of their activity in Israel.
Arab media report that senior figures in the Palestinian Authority have appealed to the Saudi Arabian authorities to cancel Alstom's win in a huge tender for the construction of the Haramain Express Railway, a high-speed rail link between the holy cities of Mecca and Medina. The reason is that Alstom is a 20% partner in the City Pass consortium which won the concession for the Jerusalem light railway.
The Palestinians say that Alstom is one of a group of companies that will build the railway "which will link illegal Israeli settlements in the occupied Palestinian territory (including East Jerusalem) with the city of Jerusalem."
The Palestinian Authority's appeal to the Saudi Arabian government is based on a March 2006 resolution of the Arab League forbidding Arab countries from maintaining ties with the companies working on construction of the Jerusalem light railway. The Palestinian Authority has backed Palestinian groups bringing lawsuits in the French courts against Alstom and Veolia over their involvement in the project.
The Saudi Arabian tender is worth $1.8 billion, and is the first stage of a huge $6 billion project to build a 444 kilometer fast rail link.
Alstom (as supplier of the trains) and Veolia (project operator) have been with the Jerusalem light rail project since the tender for it was published, and remained with it despite political pressures during the second intifada.
It was reported this week that Veolia was examining the sale of its 5% stake in City Pass, and that it has unofficially informed its partners of this. Senior government sources said however that no approach had been received about the matter, and that any change in the make-up of the consortium would require the state's consent.
Because of the delays in the Jerusalem light rail project, there are few international companies that would be willing to replace Veolia, and the attempts to involve Israeli bus companies Egged and Dan have in the past met with opposition from the Antitrust Authority.
Published by Globes [online], Israel business news - www.globes.co.il - on June 10, 2009
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