In June 2007, following an internal conflict between Palestinian factions in the Gaza Strip that lasted for several weeks, Hamas took control of the security apparatuses of the Palestinian Authority in the area. Following this, Israel closed its border crossings with the Gaza Strip and tightened its control over the area, making movement in and out of Gaza, whether of people or of goods, virtually impossible. On 19 September 2007, the Israeli security cabinet classified the Gaza Strip as a “hostile entity.” Israel maintains that this decision enables it to take various punitive measures against residents of Gaza in response to the firing of Qassam rockets into Israel, including restricting the supply of electricity and fuel to Gaza. The siege affects not only the land crossings, but also access to the sea, which is under total Israeli control. It has destroyed Gaza’s economy and has increased the severe poverty there, as will be described below.
On 20 June 2010, after international pressure was placed on Israel in the wake of its action in taking control of the Turkish flotilla to Gaza, the security cabinet decided to ease the siege by enlarging the list of goods allowed into Gaza, by expanding operations at the crossings, by permitting the import of building materials for public projects and for residential construction under international supervision, and by making its policy on entry and exit of persons for humanitarian and medical purposes more efficient.
The new policy included replacing the list of products permitted into Gaza at the time with “a limited list of prohibited articles, intended to prevent only the entry of weapons and items that might aid Hamas’ terrorist regime in harming Israeli civilians.” On 6 July 2010, Israel published two lists. One list details items whose import into Gaza is forbidden without a specific permit, such as weapons and chemical materials that might be used to make weapons, along with dual-use materials, i.e. items that can be used for both civilian and military purposes. The second list contains items necessary for construction work, “whose entry is permitted only for projects approved by the Palestinian Authority and carried out by the international community.” This ended Israel’s three-year-old prohibition on the import of many consumables. The government’s decision does not mention allowing exports from the Gaza Strip.
On 8 December 2010, the government announced a further easing of the siege by allowing agricultural, furniture, and textile exports.
On 2 June 2010, Egypt opened Rafah crossing, on its border with Gaza. At present, it permits the crossing of persons in humanitarian and medical cases, as well as students, foreign residents, and Palestinians wanting to visit relatives abroad.
The three years of the siege caused a grave economic crisis in Gaza, and the extensive damage caused to houses and infrastructure in the course of Operation Cast Lead aggravated the situation. The repercussions include lack of food security among much of the population, high unemployment rates, limited possibilities for earning a living in agriculture, fishing and industry, and harm to the entire fabric of life. According to a survey conducted by the International Red Cross, in May 2008, 70 percent of Gazans were living in poverty, with a monthly income for a 7-9 person family of less than $250 (one dollar a day per person), and 40 percent of urban dwellers were living in deep poverty (a monthly income of less than $120, a half a dollar a day per person). The Red Cross’s figures also showed that, in 2009, 75 percent of the residents, more than 1.1 million persons, lacked food security, compared with 56 percent in 2008, and that dependence of the entire population on external aid was 5 percent higher than before the siege, and stood at 26 percent. According to figures of the Palestinian Bureau of Statistics, in the first quarter of 2010, 33.9 percent of the work force in the Gaza Strip were unemployed, and more than 50 percent of Gazans under age 30 were unemployed.
The decision to ease the siege is welcome, but it is only a small step in the right direction. The entry of more consumables eases the conditions of daily life in Gaza, but does not enable rebuilding of its economy. The severe restrictions on exports still in place leave Gaza isolated, making real economic development impossible.
Disruption in power supply
In October 2007, Palestinian residents of the Gaza Strip and Palestinian and Israeli human rights organizations, including B'Tselem, petitioned Israel’s High Court against the state’s cut in electricity and fuel supply to Gaza. The petitioners argued that the cut would cause extensive humanitarian harm, even to the point of endangering human life. In late 2008, the court denied the petition. The court accepted the state’s argument that some of the fuel supplied by Israel is used by terrorist organizations in the Gaza Strip for various purposes, and that reducing supply would therefore curb terrorist activity. The court also accepted the state’s argument that the basic humanitarian needs of Gazan residents would not be harmed by the cut.
Since then, Israel has allowed into Gaza only 63 percent or less of the amount of industrial fuel needed to operate the power plant there. For four months, as of November 2008, Israel allowed no such fuel to enter Gaza at all. The industrial fuel is intended solely for the power plant and is funded by the European Union. In addition, Israel has reduced the quantities of gasoline, diesel fuel, and cooking gas entering the Gaza Strip.
The fuel shortage directly reduces the generation of electricity in Gaza and impairs the water and sewage systems, which require fuel to operate the pumps. Israel’s continued prohibition on import of spare parts for the electricity system causes additional malfunctions and deficiencies.
Another factor limiting power supply in Gaza is the disagreement between the Palestinian Authority and the Hamas government over the responsibility for paying for the industrial fuel to operate the power station. The disagreement has further reduced the amount of fuel provided to Gaza: this summer (2010), less than one-third of the amount needed to operate the station on full capacity was supplied. As a result, the station closed down operations for five days in June and for two days in August. All residents of Gaza, except for those in Rafah, who receive their electricity directly from Egypt, suffered power outages of 8-12 hours a day. On 25 August, more than half a million liters of industrial fuel entered Gaza, enabling two turbines to operate. Consequently, the power outages dropped to 4-6 hours a day.
Drinking water crisis
Almost 95 percent of the water pumped in the Gaza Strip is polluted and unfit for drinking. This warning was recently issued by the UN Environment Program, the Palestinian Water Authority, the Gaza Coastal Municipalities Water Utility, and international aid organizations. They estimate that it will take at least 20 years to rehabilitate Gaza’s underground water system, and that any delay will lead to further deterioration, prolonging the rehabilitation process for hundreds of years.
The water crisis in the Gaza Strip results from over-pumping of the underground water of the Coastal Aquifer, which causes salt water to enter the aquifer. The excessive pumping, which has been in practice for several decades, did not stop after Israel retreated from the Gaza Strip, continuing under the Palestinian Authority and now under the Hamas government. The underground water has further been polluted by the deterioration in maintenance of the wastewater-treatment facilities since the siege on Gaza began, exacerbated by the damage done to the wastewater-treatment facility in Gaza City during Operation Cast Lead.
Due to the poor quality of water, many Gazans have no choice but to buy water treated in facilities operated by local entrepreneurs or to use household water-treatment devices. No agency supervises the quality of water treated by these facilities or devices, and they cannot function consistently due to lack of spare parts and the frequent power shortages.
Purifying water from pollutants such as nitrates and chlorides is very expensive. Consequently, a cubic meter of treated water can cost up to 50 shekels, ten times higher than the price of a cubic meter for households in Israel. Many Gazans cannot afford this expense.
Restriction on the entry of goods
According to UN figures, during the first two years of the siege, an average of 112 containers (a entered the Gaza Strip each day from Israel, compared with a daily average of 583 containers prior to the siege (a container is a truck hauling one freight compartment). In May 2010, one month before Israel declared an easing of the siege, the daily average was 90 trucks. Immediately after the decision, the number rose to 150. According to the official estimate, by mid-2011, the number will reach 400. Despite the improvement, this is still 30 percent lower than the daily number of trucks that entered Gaza prior to the siege and does not fully meet the population’s needs. Also, it appears that the improvement is not steady: B'Tselem’s investigation indicates that, whereas in October 2010, 139 trucks entered daily on average, the number dropped to 98 in November.
The tunnels economy:
The siege policy has led in recent years to the development of a tunnel-based economy between the southern Gaza Strip and Egyptian Rafah. A variety of goods have been brought into Gaza through the tunnels. Their operation is controlled by Hamas, which collects taxes from the operators. In addition to consumer goods, Palestinians also smuggle weapons through the tunnels, including rockets. Following the expansion of tunnel activity, it was reported in 2008 that various products were once again available in Gazan markets, and that prices had fallen somewhat due to increased supply. Nevertheless, smuggling goods cannot replace a stable local economy. Following the decision to ease the siege, the activity in the tunnels dropped substantially.
Severe restrictions on exports
In addition to the restrictions on imports, Israel has also prevented almost all exports from the Gaza Strip. Prior to the siege, more than 1,000 containers a month, on average, were exported, compared to a total of 259 containers during the entire three years of the siege. The government’s June 2010 decision easing the restrictions did not relate to exports. However, on 8 December 2010, the government announced a further easing of restrictions, following some exports of flowers and strawberries that it had enabled shortly before. The new rules allow up to 10 truckloads of exports a day. This number represents less than 30 percent of pre-2007 exports from Gaza. Also, only specific kinds of products may be exported.
The severe restrictions on exports have severely reduced the income of farmers, who previously exported their produce and now must sell at a loss in the local market, and workshops and factories have had to close because they are prevented from marketing their goods abroad.
Collapse of economic activity in Gaza
The shortage in basic imports and the severe restrictions on exports have brought the Gazan economy to a state of collapse. Ninety percent of factories and industrial workshops have closed, and the rest have had to scale back operations. After Operation Cast Lead, the International Red Cross reported that 3,750 businesses had closed and that approximately 40,000 persons (some 94 percent of workers in these businesses) had lost their jobs.
The decision to ease the siege does not include wholesale entry of raw materials for manufacturing, and therefore does not enable rebuilding of the local industry in the strip. With the renewed flow of goods arriving from Israel, the industrial sector suffered another blow, as it cannot compete with the imported goods. Especially hit was the beverage industry: in addition to the shortage of raw materials, it now faces competition from juices and carbonated beverages imported from Israel.
Restrictions on food supplies
Since the beginning of the siege, in 2007, Israel has prohibited the entry of many basic foodstuffs into the strip, according to a list that changes from time to time. The ease in restrictions announced in July 2010 applies mostly to household goods. Therefore, Gazan markets now offer a much greater variety of products, yet these are unattainable for many families due to the high poverty rate.
No-go zones – agriculture and fishing
Israel permits Gazan fishermen to reach only up to a certain distance from the shoreline. As part of the siege, it has reduced this distance from twelve nautical miles to a mere three, denying fishermen access to the richest fishing areas. This restriction impairs the ability of thousands of persons who depend on the fishing industry to gain a livelihood, as well as denying Gazans a vital food source.
In addition, in May 2009, the army expanded the no-go zone along the Israel-Gaza border that Palestinians cannot enter. The zone was set at 150 meters after Israel’s 2005 disengagement from Gaza, and is now more than 300 meters wide. This causes further harm to Gazan farmers, who comprise about a quarter of the strip’s population, as some 35 percent of the strip’s farming land is located in areas close to the border.
Operation Cast Lead
In Operation Cast Lead (27 December 2008 to 18 January 2009), Israel not only killed and wounded thousands of persons but also caused extensive damage to homes, to factories and to agricultural structures, as well as to the electricity, sanitation, water, and health infrastructures in the strip, which were already on the verge of collapse due to the siege. During the operation, only 25 percent of the electricity demand was met. Half a million residents did not receive running water, and sewage flowed in the streets.
Two years later, the vital infrastructure damaged in the operation has not yet been rebuilt, due to the prohibition on goods entering the strip. Ninety percent of the population suffers daily from power outages of up to six hours a day, caused both by the damaged infrastructure and by the abovementioned dispute between Fatah and Hamas. Some 3,000 residents of the northern part of the Gaza Strip have no access to running water because of the power shortage. Also, the severe restrictions on the entry of building materials make it impossible to rebuild the 3,450 residential dwellings that were destroyed and the 2,879 houses that were damaged. Some twenty thousand uprooted Palestinians live in crowded conditions in rented apartments, with relatives, or in tents. The health system, which was forced to cope during and after the operation with thousands of injured persons and with the damage caused by the Israeli attacks against the medical staffs and facilities, has been crucially damaged.
In the decision to ease the restrictions on entry of goods, Israel announced that it would allow the entry of raw materials for specific public projects, which have been approved by the Palestinian Authority and which are carried out under international supervision, such as the building of schools, health facilities, sanitation facilities, and the like, and also for construction enterprises, such as the project to build residential dwellings for the UN in Khan Yunis. Recently, the quantity of raw materials entering the strip for water and sewage enterprises has risen, with 18 truckloads of goods such as chlorine, drainage pumps, replacement parts, and chemicals for water purification entering in August 2010. However, such quantities are still miniscule compared with the population’s needs.