But when visitors choose to take a piece of the Holy Land back home with them, they better check the labels. Many souvenirs including the West Bank town's trademark rosemary beads are imported from abroad, mainly China.
A small number of souvenir shops are now trying to fight the trend, stocking their shelves almost exclusively with locally made products. Shopkeepers say that while their wares may be more expensive, the quality is much better and they give an important boost to the struggling economy.
Some 120,000 people are expected to visit the Holy Land this holiday season, half of them Christian, according to Israel's Tourism Ministry.
Many will visit Bethlehem, where globalization has left its imprint like everywhere else. Foreign-made crafts, especially Chinese ones, have come to represent a big part of the market here, including Christmas souvenirs. While there are no official statistics, local officials and businessmen estimate that nearly half of the products, perhaps more, are imported.
"This is a plastic Jesus baby made in China and this is a ceramic one made in Bethlehem, and these are the olive wood rosaries that I make and the Chinese ones," he said, proudly showing what he said was the superior craftsmanship of the locally made goods.
Bethlehem is in the West Bank, occupied territory the Palestinians hope will be part of their future state. Tourism remains strong, but the rest of the economy has long languished, in part because of Israeli restrictions. Tourists must pass through a checkpoint in Israel's separation barrier to reach the town.
"There's a big influx of imported products and a lot of traditional crafts are declining gradually," said Samy Khoury, the center's founder and general manager.
The Visit Palestine Center, which started as an online store and travel guide five years ago, works with nearly 100 workshops and home-based artisans throughout the Palestinian territories and in Palestinian refugee camps in Jordan.
Trying to sell only Palestinian-made products comes with challenges.
"Maintaining consistency and quality, the right lead time, figuring how much production capacity the producers can give," are some of them, explained Khoury.
Then there's the issue of price.
"We have to carry all kinds of merchandise in our shop because we have different markets and different pilgrims with different budgets," said Canawati, whose family has provided services to pilgrims since the 16th century.
Canawati said he wants to give his customers options, and he is clear about the differences.
Under the proposed regulations, shopkeepers would be required to carry 70 percent locally made products, with clear labels that distinguish between imports and "Made in Palestine" ones.
Muhammad Yusuf, a wood craftsman with The Olive Wood Factory, scoffs at the imports.
"It's not good, this is better," he said with a smile as he worked on a figure of the Virgin Mary.