This week we will try again to understand what the possibilities are for industry in Gaza when the import of consumer goods, such as furniture, is permitted, when raw materials for industry have been cleared for entrance after many months, and while the ban on export remains firmly in place. This time we spoke with Tahseen al-Isi, director of the al-Isi furniture company in Gaza City, whose family has manufactured furniture for the Gaza market since the company was founded in 2000.

Employees in a furniture factory in Gaza.

As opposed to the textile factory we wrote about last week, al-Isi’s factory did not export to the West Bank before 2007, instead focusing on the local market. But since the sweeping ban on export was imposed in June 2007, al-Isi has found himself competing for the small local market in Gaza with all of the vendors who cannot export to the West Bank. The market is flooded with local merchandise, in addition to Israeli merchandise that is allowed in, and as a result, prices have dropped to the point where merchants hardly make any profit.

But that’s not the only problem. Al-Isi explains that when Israel banned the import of wooden boards, he bought expensive boards smuggled through the tunnels. When the ban was lifted, al-Isi discovered that the price of the boards he was buying was three times higher than the price of those recently brought into the Gaza Strip through the crossings from Israel. And so al-Isi found himself having to compete with other furniture-makers who had paid less for their materials, which in turn forced him to reduce production by 50%. If he had continued producing at the normal volume, says al-Isi, his losses would have reached $50,000.

Furniture factory in Gaza

The ban on export not only floods the market with cheap products but also causes a steep rise in unemployment. Whereas in the past al-Isi had 18 carpenters working in the factory’s workshops, today he has only five workers. Al-Isi says that the workers suffer from the situation the most. So much so that most of them now rely on the aid of local and international organizations: “Most are frustrated and desperate about the economic situation”, al-Isi says sadly, “and we merchants do not have a magic wand to change the situation in Gaza”.

Therefore, the ban on export, which is one of the most important aspects of the closure on Gaza, affects directly the citizens’ right to live with dignity.

Even seasoned pundits could not help but express dismay this week at the televised testimony by senior Israeli officials, beginning with Prime Minister Benjamin Netanyahu, before the Turkel Commission charged with investigating the Israeli military’s May 31 interception of ships bound for Gaza. As the Israeli daily Haaretz pointed out in a scathing editorial, Netanyahu readily acknowledged that Israel’s decisions on what to allow or prohibit into Gaza were based not on concern for the welfare of the population in Gaza but rather about Israel’s image in the international media:

“Even though there was not a humanitarian crisis in Gaza, I decided to gradually ease the limitations and the movement of goods through the land crossings. I did so because gradually these limitations turned into a diplomatic and public relations burden”.

If the limitations really were, as Netanyahu claimed, necessary “to prevent the entry of weapons and war materiel into Gaza”, easing them just in order to improve Israel’s public relations would seem grossly irresponsible. If they weren’t necessary for security – why were they imposed in the first place?

We also found puzzling Netanyahu’s claim that “Israel increased the number of trucks entering Gaza by approximately 30% over the five months preceding the flotilla incident”.  According to the Israeli Ministry of Foreign Affairs, in the first five months of 2010, Israel actually decreased the volume of trucks permitted into Gaza by 9%, relative to 2009 (see the first and last pages of the MFA report, which show that the monthly average of trucks allowed into Gaza in 2009 was 2,576, compared with just 2,329 in the first five months of 2010).

The real change in the volume of trucks permitted into Gaza came only after the flotilla incident, when Israel was pressed to justify its policy blocking the movement of people and goods into and out of Gaza: Last week, Israel allowed Gaza residents to receive 1,126 truckloads of goods, approximately 45% of need, as compared to about 25% of need prior to the flotilla incident.

Export and the movement of people, critical for economic recovery and normal life in Gaza, are still blocked. Perhaps these restrictions do not constitute a sufficiently heavy “diplomatic and public relations burden”?

The media last week heralded the opening of the first shopping mall in Gaza and immediately the blogosphere was atwitter. Some saw it as proof of the easing of the closure, which Israel had promised, and others saw it as a sign that there is no crisis in Gaza. Indeed, a two-story building converted into an air-conditioned shopping mall (restrictions on the transfer of construction materials into Gaza for the private sector are still in effect and would preclude the building of such a structure) does not correspond with the usual images of the Strip, nor with concerned reports about hunger arising from the closure, still in effect despite the easing of some restrictions. But Gaza is not and was never a place with a quantitative food shortage; rather it is a place where many people lack the means to buy food and other goods because of a closure policy whose tenets are “no development, no prosperity, and no humanitarian crisis”.

Prices at the new shopping mall are particularly low, clients say, and considering the limited buying power of Gaza residents, there seems to be no other choice. Sixty-one percent of households in the Gaza Strip suffer from food insecurity, where the UN defines food security as “a situation in which all people, at all times, have physical, social and economic access to sufficient, safe and nutritious food which meets their dietary needs and food preferences for an active and healthy life”. Unemployment is at 34%, a figure that should come as no surprise due to the sweeping ban on exports from Gaza enforced since the beginning of the closure of Gaza in June 2007. Israel has emphasized that the recent cabinet decision announcing an easing of the closure does not apply to export (nor to the movement of people). Even the recent lifting of the ban on the transfer of raw materials and the slow trickle of spare parts into Gaza have not yet made their mark on economic activity, especially considering the crossings’ capacity limitations.

According to the mall’s directors, the vast majority of brands sold at the mall – 90% – are Israeli-made, in addition to a small percentage of items originating in the West Bank. This is another indication of the dearth of goods manufactured in Gaza itself. Indeed, how can you manufacture clothing, shoes, carpets and food products (items that have been manufactured in Gaza in the past), when, even after the cabinet decision to “lift the closure”, the amount of goods transferred into Gaza last week (979 trucks compared to 2,350 trucks a week in 2005) meets only 40% of needs?

The price is of the products at the mall may be low, but apparently not low enough for most of the residents of Gaza.

On Sunday, Israel’s Cabinet issued an encouraging statement promising to remove many of the restrictions on civilian goods entering Gaza, including those needed for economic activity.

What has changed on the ground since the announcement and more generally, since international pressure mounted on Israel in the wake of the May 31 flotilla incident? The list of consumer goods permitted into Gaza has been expanded to include previously banned items such as ketchup, mayonnaise, and children’s toys. Ah, yes, and chips (french fries) as well, for dipping into the ketchup. But that’s about it.

We are therefore puzzled by Prime Minister Netanyahu’s statement that “we are already seeing a significant growth in the scope of the civilian goods entering Gaza.” There has been no significant change in the volume of trucks entering Gaza, as is evident from Gaza Gateway’s graphs. Last week, for example, 654 trucks entered Gaza, including via the grain elevator, similar to the number that entered in the week before the flotilla incident (662). This week, as of yesterday, the fourth of five working days for the crossings, approximately 567 trucks had entered Gaza, which is consistent with the policy, since June 2007, to allow entry of approximately 25% of what Gaza residents need.

Indeed, it is hard to see how more goods could enter Gaza, given that the one crossing still operating – Kerem Shalom (Kerem Abu Salam) – is working at near capacity with an average of 110 trucks per day of goods, five days per week. The “significant growth” mentioned by Mr. Netanyahu would be difficult unless Israel opens some of the crossings it has sealed over the last three years, including Karni Crossing, Gaza’s commercial lifeline, with a capacity of 1,000 trucks per day.

In any event, as Dan Ephron notes in Newsweek today, without the ability to export finished products and receive raw materials (they are still not being allowed in), economic recovery in Gaza will remain elusive.

On Tuesday, May 25, 2010, the Israeli Ministry of Foreign Affairs (MFA) released its latest update, claiming to be actively contributing to the humanitarian needs and even economic development of the Gaza Strip. Contrast the MFA report with UN agency OCHA’s critical report on limitations to access in the Palestinian territory released on May 27, 2010.

We wrote last week about the seeming paradox between a policy whose stated goals are to reduce civilians to the minimum “essential for survival” (but not to fall below it) in order to achieve political gains, while at the same time boasting of one’s humanitarianism.

This week, together with Physicians for Human Rights-Israel (PHR-Israel), an Israeli human rights group that protects the right to health, we provide further details.

Humanitarian aid only, and even that just barely trickles through

• Food and hygiene products continue to account for 76% of the goods allowed in to Gaza, although entrance is routinely denied for many food items including chocolate and vinegar. Food items that could be used as inputs for local food production – such as margarine in large buckets or glucose – are banned. Civil society institutions, critical infrastructure, factories, schools, and even homes can’t function on flour, sugar, and sponges alone.

• Numbers show that indeed many tons of aid is going into the Strip, destined especially for the 80% of Gaza residents now completely dependent on charity because of the collapse of the economy. Export for commercial purposes, which was allowed on exceptional basis for the strawberry and flower markets, was minimal: 259 trucks in three years were allowed to leave Gaza, which is less than what Gaza residents were exporting in four days prior to June 2001.

• The Foreign Ministry claims that Israel facilitates “all cases of medical treatments from Gaza unless the patient is a known perpetrator of terror”. Last year, over 2,300 entry permits for medical treatment were either rejected or delayed by Israeli officials. These rejections included many individuals who, according to Israel, “only” wish to improve their “quality of life” – by trying to avoid loss of vision or limbs. In these cases, Israel says it need not allow entrance. It also includes patients denied entry where no security allegation was made, but rather the military claimed there was concern that they would remain in the West Bank after treatment, contrary to Israel’s political goal of separating Gaza from the West Bank.

• During the first two months of 2010, PHR-Israel re-submitted the requests of 23 individuals who were initially rejected for security reasons. Thanks to expert opinions from senior Israeli physicians attached to each request, 10 out of the 23 cases were overturned. This raises serious questions about the balancing act that Israel claims it performs between each patient’s medical needs and his or her perceived threat to State security. It also raises questions about the State’s definition of “security risk”.

• Israel claims that Hamas is often an obstacle to granting permits for medical care. However, Hamas has little to do with the permit process. The process was actually created during the Oslo Peace Process, and both the Palestinian Authority and Israel have a role to play. Patients are required to receive an authorized referral from practicing physicians in Gaza, apply for financial coverage from the Palestinian Authority in Ramallah, submit papers to a Palestinian Civil Affairs Committee in Gaza subject to the authority of the PA in Ramallah, which then forwards the request to the Israeli Army at Erez Crossing. This process takes an average of 6 weeks and is extremely taxing on Gaza’s sick and injured as well as their families.

• While Israel has the right to conduct security checks, Israel often exploits a patient’s vulnerable state by preconditioning entry for medical treatment on participation in a Shin Bet interrogation – in violation of international law. In several cases, the Shin Bet has summoned patients to the Erez Crossing for security investigations, and then tried to coerce them into collaborating with the Shin Bet by conditioning an exit permit on their collection and provision of information to the Shin Bet. In a number of instances, the Shin Bet went as far as using the permit application process as a way to “lure” Palestinians to the Erez checkpoint in order to arrest them: upon arrival at the checkpoint, they have been immediately arrested and imprisoned in Israeli jails.

Illustration: Moran Barak, source: PHR-Israel

• The MFA reports that coordination with international parties on entrance for building supplies takes place regularly. OCHA, the UN’s Office for the Coordination of Humanitarian Affairs reports that it took nine months of negotiations to get approval for entrance of items to finish construction on some 151 housing facilities that were already 85% complete on the eve of the closure in June 2007. This is a hard-fought-for drop in the bucket compared with the 86,000 housing units that are needed in Gaza.

• Likewise, UNRWA reports that donor funds to the tune of $109 million USD are frozen because restrictions on movement of building materials prevent breaking ground on 24 constructions and infrastructure projects. If it took nine months to negotiate the start of each of the 24 projects, we’d be looking at 18 years of negotiations.

• We’ve written before about Israel’s refusal to allow books, stationery, toys, and other educational materials for 248,000 students in Gaza, although it makes an exception for other students studying in UNRWA schools. But UNRWA alone, whose schools generally operate three shifts to deal with overcrowding, needs to build 100 schools to meet demand, and Israel refuses to allow the building materials to enter. Even if Israel were to agree to allow in the building materials and if it takes nine months to negotiate the construction of each school, UNRWA would have its schools after about 75 years, about the time that today’s children would be in their 80s.

We are encouraged that the MFA report seems to embrace the need to facilitate humanitarian aid, while encouraging the development of a healthy economy in Gaza. If Israel is truly interested in implementing such a policy, it would be advised to open Gaza’s crossings for movement of goods and people, subject only to concrete security considerations and not political maneuvering.

Since Israel sent a search and rescue team and doctors to help earthquake-devastated Haiti, op-eds and articles have praised Israel’s important provision of relief and also attempted to hold up a mirror to the country, showing closure-devastated Gaza just over our shoulder. Some in Israel asked, how is it that aid is rushed half a world away when children are living in half-destroyed homes just an hour’s drive from Tel Aviv? Others argued that Israel’s positive actions in Haiti should stand alone, even if the Israeli government over-publicized the efforts (in his blog this week, Ami Kaufman adds English subtitles to a popular Israeli satire spoofing the over-focus on Israeli rescue efforts in Haiti – worth watching!). Israel’s Foreign Ministry justifiably expresses pride in Israel’s humanitarian actions in Haiti, but it also boasts, for example, in the MFA round-up for 2009 that aid to the Gaza Strip increased by 900% in 2009. Is that really something to be proud of?

On average, 2,500 trucks of goods enter the Gaza Strip each month. This is roughly 25% of the amount that entered prior to the June 2007 closure of the Strip (10,400/month). The items permitted entrance are limited to basic goods “necessary for the survival of the population” (to quote a recent letter Gisha received from the Coordinator of Government Activities in the Territories (COGAT)). Items like flour, grain, and sugar are allowed. Every month new items appear among those allowed in and others items are mysteriously rejected: coffee this month yes, but cardamom to flavor it, no. Anise yes, and black pepper too, but vinegar no. Significantly, there is a total ban on raw materials that would permit Gaza residents to engage in production and commerce, allowing for economic independence. Clarity regarding the policy requires no less than a court order.

Israel does not provide the aid transferred to Gaza. In fact it earns on each truck that passes and each ton of aid bought or shipped, stored, and transferred through its territory. After closing all of Gaza’s other crossings, including the airspace, territorial waters, and indirectly – Rafah Crossing – Israel partially opens its side of the gates to Gaza to allow others to bring in aid and other items. More often than not, Israel blocks the movement of goods in to and out of Gaza and of course the movement of people who in most parts of the world travel into and out of their countries for simple, every day things like work and school and weddings.

These restrictions – and the policy underlying them, limiting Gaza residents to a “minimal” existence – are what have helped make Gaza residents dependent on international aid, whose provision Israel burdens.

Since the end of December 2009, 36 trucks loaded with strawberries and cut carnation flowers were permitted to leave Gaza for Israel’s Ashdod port, from which they were shipped to Europe. This is the first time since January 2008 that strawberries have managed to leave the 41 kilometer-long Strip. The flowers have been a little luckier – prior to December 2009, Israel permitted the export of 19 truckloads of flowers during the past 2.5 years of closure, mostly around Valentine’s Day.

Prior to the June 2007 closure, 30-35 trucks of agricultural produce were exported every working day of the agricultural export season (November – March), carrying mainly cherry tomatoes, flowers and strawberries. This amount is from a total daily average of 70 trucks of exports, mostly furniture, garment, cash crops, vegetables, processed food, metal products, handicrafts, and other kinds of goods. Gaza export –halted except for the trickle of strawberries and flowers – used to account for 10.8% of the Palestinian gross domestic product (GDP), valued at $330 million. That is now lost. Estimated annual losses from the inability to export agricultural products alone stand at approximately $32 million, and tens of thousands of people in the agricultur! al sector have lost their livelihood.

The flower and strawberry export is part of a one million Euro program, sponsored by the Dutch government, to support Gaza’s farmers. The Dutch government insists that Israel permit the flowers and strawberries to reach European markets as an exception to the ban on all other kinds of export from Gaza, a ban which has forced other donors to convert development programs into humanitarian hand-outs. If Gaza’s crossings were fully open for export and Gaza residents were afforded the right to engage in a dignified living, European taxpayers could spend less money on aid and more money buying strawberries grown in Gaza, rumored to be among the sweetest and reddest in the world.

According to Palestinian officials, last week Israel mounted two attempts to transport industrial diesel into the Gaza Strip via the Kerem Shalom border crossing, and not via the Nahal Oz crossing, which has until now been the only crossing designed and equipped for the transfer of fuels and gas to Gaza. Attempts to transfer industrial diesel via Kerem Shalom were also made in the previous month. In the last week, Israel transferred not one drop of industrial diesel via Nahal Oz and in the previous two weeks transferred 3.68 million liters in total- 53% of the amount required. The reports that Israel intends to close down the Nahal Oz crossing completely follow a gradual slowdown of operations at the terminal, which now operates only three days a week.

The other crossings have also been closed: Karni Crossing, which was the main trade route, has been closed since June 2007, and only one conveyer belt, used to transport produce and animal feed, has continued to operate on a partial basis since then. The Sufa crossing has not operated since September 2008 and Israel announced its permanent closure in March 2009. The transfer of goods via the Rafah crossing is prohibited. And so all of Gaza is now almost totally dependent on the Kerem Shalom crossing, which has limited capacity and was originally designed for the occasional transfer of humanitarian aid only. Now Israel apparently plans to burden Kerem Shalom with fuel and gas transports as well.

Of course, in response to rocket fire from the Gaza Strip, Israel occasionally closes Kerem Shalom too, due to what it identifies as dangers to the crossing.

The possibility that security risks would threaten the opening of Gaza’s crossings was the subject of considerable forethought. As a result, three fundamental conditions designed to ensure that the Gaza Strip crossings would operate continuously were established and agreed to by Israel:  (1) Recognition of the need to operate alternative lanes (lane redundancy); (2) recognition of the need to operate alternative crossings (passage redundancy); and (3) the primary objective which Israel committed to in the Crossings Agreement: the principle of continuous operation.

It is hard to imagine how one crossing, consisting of only one primary lane, can fulfill these fundamental conditions.

Meanwhile, Israel continues to strike against the tunnels underneath the Egypt-Gaza border, via which the majority of goods required by Gaza residents are transported, including by blowing them up.

Under these circumstances, with the sea and air routes completely blocked, the tunnels rejected as a legitimate option, and the overland crossings increasingly shut down, how exactly are the residents of Gaza supposed to get the goods they need?

When senior foreign delegates visited Israeli President Shimon Peres recently, they were surprised when he informed that there are no humanitarian problems in the Gaza Strip.

He maintained, in fact, that there is plenty of food, medicines and other products, although there is a slight shortage of cement. But you know – Hamas wants cement.

The gap between the well-documented existence of a severe humanitarian situation in Gaza and the President’s firm assertion that there is no such thing was so vast that the delegates could not help but wonder: Could it be that Peres was lying to them?.

The fact of the matter is that since Israel imposed an almost total closure on the Gaza Strip 27 months ago, it has repeatedly declared that there is no humanitarian crisis. It continues to stick to this story even though it only allows 25% of the needed goods to pass into Gaza (some 2,500 trucks per month as opposed to 10,400 prior to the closure). It does so even though around 75% of the population of Gaza (more than 1.1 million people) has been classified as “food insecure” by international organizations. It does so even though more than 90% of the water in Gaza has been declared non-potable according to World Health Organization standards, due partly to the shortage of equipment to treat it properly.

In fact, the President did not lie when he claimed that Gaza has an adequate supply of basic foods – rice, flour, and oil, for example – which Israel allows in. But please don’t ask about foods like sesame, juice powder, or beef stock – these items are banned, because they are beyond what is essential for the “basic existence of the population.”

Raw materials for industry, paper for textbooks, and building materials for reconstructing homes have also been classified by Israel “as beyond what is essential for the basic existence of the population.” Therefore, their import into Gaza has been prohibited.

As a result, two-thirds of the people in Gaza – one million human beings – are forced to rely on food assistance, 97% of the factories have shut down, unemployment stands at over 40%, and the local economy has collapsed due to the ongoing ban on the import of raw materials and the export of finished products.

The President did not lie, but he failed to mention essential information about the goals of Israel’s policies – to keep Gaza on life support, to permit the minimum transfer of food to prevent starvation, and to do everything in its power to prevent economic growth.

Picture this: its 7:15am, 40-60 children are crammed into a single classroom ready for a new day of learning. Many of them have no exercise books, textbooks or even pencils. This scene repeats itself at 12:15pm, when the “second shift” starts in the same classroom, at the same school, with the same overcrowding and the same shortages (no, this is not Israel in the 1950’s; this is the Gaza Strip in 2009).

A total of 451,704 students went back to school two weeks ago in the Gaza Strip. The new school year promised more of the same struggle to cope, even at school, with the outcomes of the war and the closure imposed by Israel on the Gaza Strip for the past 27 months. For over two years, Israel has refused to allow paper to be imported into the Gaza Strip (except to the UNRWA schools) since paper is not considered “essential for the basic existence of the population.”

The education system, already weakened by the closure, sustained a severe blow when 280 schools and kindergartens were damaged during the war, including 18 schools that were completely destroyed. And there is no possibility of rebuilding them, since cement and building materials are also unnecessary for the “basic existence of the population.” Some 12,000 students who attended the destroyed schools were forced to look for new schools and this has led to an increase in the number of students at other schools, to more than 60 pupils in some classes. At present, almost 90% of the 221 schools operated by the UNRWA in Gaza and more than 80% of the 383 state schools are forced to operate in “shifts” in order to cope with the large number of students.

In the northern Gaza Strip alone, the destruction of 15 schools left 9,000 students without a place to study. Some 4,000 of them were placed in just 2 schools.

At the top of the list of goods that Israel won’t allow into the Gaza Strip are construction materials which can be used to repair the heavy damage sustained during the war and to rebuild the schools that were damaged and destroyed. As billions of dollars earmarked for the reconstruction of the Gaza Strip remain unspent due to Israel’s policies, Israel has chosen a strange way to “teach Gaza a lesson.”