The issue came to a head earlier this year after the student body’s decision to ban Domino’s Pizza from "Tent City" during O Week.
It was justified as being part of the Boycott, Divestment and Sanctions (BDS) position — a Palestinian-led movement promoting boycotts, divestments and economic sanctions against Israel or products with ties to it.
But OUSA walked back the policy at an executive meeting on Monday, citing a lack of information.
This has led to Green Party MP Francisco Hernandez urging the association to rethink the damage done in a letter to the executive.
Mr Hernandez asked OUSA to be mindful of their reputation.
"While there may be sponsorship and funding opportunities that OUSA will lose as a result of taking this stance — there is no immediate expectation that OUSA seamlessly shift from 0-100 on the Boycott, Divest, Sanction campaign so the immediate impacts and costs are not as dramatic as you may have been advised.
"But doing the right thing is rarely easy and politics is sometimes about making difficult choices."
The letter also referred to the fact the executive had surveyed the students earlier this year, and more than 53% were in favour of the sanctions.
A trio of action groups — Otago Students for Justice in Palestine, Muslim Student Association and Otago Staff for Palestine — also had stern criticism about OUSA’s attempts to take a neutral position in a joint letter.
"Purchasing decisions are not ‘neutral’; they are actions. Currently, OUSA, on behalf of the students of Otago, wants to continue actively buying goods from companies directly complicit in war crimes."
Academic Dr Olivier Jutel said the genocide in Gaza was "the moral horror of our time".
Reuters has reported that Gaza’s health ministry said Israel’s post-October 7, 2023, military assault had killed more than 56,000 Palestinians.
New Zealand Jewish Council representative Juliet Moses said she welcomed OUSA’s about-face.
"However, we believe it is a positive development to recognise the complexity of this war including the role of Hamas and its ongoing holding of hostages and oppression of Gazans, the desirability of constructive informed dialogue and engagement, and the need for two peoples to have self-determination and live with dignity and security."
OUSA president Liam White defended the change in position.
"This decision does not represent an abandonment of the underpinning principles of BDS. The OUSA executive remains committed to pursuing alternative actions that reflect solidarity and support in a more sustainable manner.
"While the executive continues to express deep concern over the ongoing and distressing situation in the region, its foremost responsibility is to ensure the continuity and stability of essential student services provided by OUSA to benefit all students at the University of Otago."
