A Jewish-American businessman has teamed up with a factory in Bethlehem to produce Palestinian-made clothes and accessories for sale on the international market.

Adam Neiman, head of Massachusetts-based No Sweat, a sweatshop-free apparel label that sells clothing and shoes, was in Israel recently to discuss plans with a Bethlehem factory. He will produce organic and fair-trade cotton yoga wear for the American and European markets. The line will be launched in Tel Aviv in December, in London in March, 2007, and then in New York next September.

"This is a project that protects the environment, safeguards the rights of workers and promotes peace and prosperity in the Middle East," Neiman says.

Union representatives in the West Bank have lauded his efforts. They are hoping his project will help jumpstart the stagnant Palestinian textile business, which has suffered significantly since the outbreak of the intifada in 2000.

"That an American Jewish person has come to us means very much," said Shaher Saed, general secretary of the Palestine General Federation of Trade Unions (PGFTU). "Adam [Neiman] will provide jobs for Palestinian workers who are now unemployed."

Neiman had never been to the West Bank before he decided to launch the joint business plan with the Bethlehem factory.

"Money and political pressure comes from the U.S. in support of the settlements and so money from the U.S. [through this project] will also go to humanizing Palestinians a little bit and showing a different part of Palestinian life," he said. "This will give American Jews and Christians an opportunity to take matters into their own hands so that people don't feel so useless."

The idea behind the clothing line is simple: The yoga wear will be made of either organic or fair-trade cotton and marketed internationally as "made in Bethlehem." The environmentally friendly clothing is targeting a mainstream Christian clientele that is politically aware and to whom the biblical significance of Bethlehem has some meaning.

The Bethlehem factory, Arja textile and Co., is owned by the Alarja family, a Palestinian Christian family that employs some 120 unionized workers. Since last year, the company has been importing organic cotton from Turkey to produce organic clothing.

"This was the first time an American Jewish person came to work with us and it was a little strange," admitted Elias Alarja, a co-owner of the factory. "But he surprised me. I never met anyone who thinks like him and who wants to use this bad situation to sell a product that will allow people to support us through this difficult time."

According to PGFTU's Saed, the textile business in the West Bank and Gaza employed some 37,000 Palestinian union workers before the intifada. The number now stands at about 10,000 to 12,000 employees - less than a third of what it was before 2000. "Most textile workers are unemployed and little factories across the West Bank and Gaza have closed down," Saed said.

The No Sweat label is distributed in some 130 locations worldwide. Neiman, who launched the business in 2001, says the label is about sympathy for the working class - and not only about "liberal upper-middle-class guilt."

No Sweat's clientele comes mainly from the political left, among consumers who "put their money where their mouth is." The site sells sneakers, as well as tank tops, shirts sports pants and jeans. All the products are union-made to ensure sweatshop-free labor.

Locally, Neiman has signed an exclusive contract with Green Action, an Israeli company that markets local and imported fair trade products.

"Consumers become activists," Neiman says. "When you vote with the dollar, it always gets counted ... Consumers who buy [sweatshop-free goods] do something real without it costing them extra time and money."

Unlike other fair trade companies, Neiman works only with unionized factories, which means that the employees get paid at least minimum wage, receive health care benefits and get paid vacations.

The company is projecting $2 million in sales this year, up from $1.5 million in 2005. They do not advertise and people come to their Web site, www.nosweatapparel.com, mostly through word of mouth.