October 13, 2012
10 October
2012 The Palestine Center Washington, DC
[NOTE: This lecture is drawn from a longer research work that will be
published (with full citations) as a new introduction to the third edition of
her book The Gaza Strip: the Political Economy of De-development
forthcoming from the Institute for Palestine Studies]
Dr. Sara Roy:
I would like to begin by thanking the Board of
Directors of the Jerusalem Fund and its Chairman, Dr. Subhi Ali, and the
Executive Director of The Palestine Center, Yousef Munayyer, for inviting me to
deliver the Edward Said Memorial Lecture. I am deeply honored.
Edward and
I would always speak about Gaza, in fact every time we met. He felt a profound
connection to the place and to the people that seemed to be a permanent part of
him. Edward had great compassion and great respect for Gaza’s people. He
embraced their suffering and took pride in their courage, in the dignified way
they continued to move forward. Yet he feared one thing perhaps most of all: the
separation and isolation that now engulfs Gaza and threatens, if it hasn’t
already, to sever the Palestinians there from Palestinians elsewhere, forcing
them, in the words of Hannah Arendt, to "live outside the common world,"
deprived of profession and of citizenship, "without a deed by which to identify
or specify [themselves]."
Edward raged against the division of his people
and against the kind of loss that such division could bring: disunity,
abandonment, irrelevance. In The Origins of Totalitarianism, Arendt
argues that the fundamental deprivation of human rights is expressed first and
most powerfully in "the deprivation of a place in the world which makes opinions
significant and actions effective. Something much more fundamental than freedom
and justice... is at stake when belonging to the community into which one is
born is no longer a matter of course and not belonging no longer a matter of
choice..." "This extremity and nothing else," she writes, "is the situation of
people deprived of human rights. They are deprived not of the right to freedom
but of the right to action." "Over the last 45 years Gaza’s trajectory has been
striking; from a territory economically integrated into, and deeply dependent
upon, Israel and deeply tied to the West Bank, to an area largely marginalized
from Israel and the West Bank, an isolated (and disposable) enclave - subject to
consistent military attacks - with which Israel and the West Bank have fewer
formal economic or political ties than they once did. And from a captive economy
restricted to fluctuating levels of growth (at best) but still possessed of the
capacity to produce and innovate (within limitations), to an economy
increasingly deprived of that capacity, characterized by unprecedented levels of
unemployment and impoverishment, with three-quarters of its population needing
humanitarian assistance. These damaging transformations among others I shall
discuss are becoming increasingly institutionalized and permanent, shaping a
future that is both partial and disfigured. What is happening to Gaza is, in my
view, catastrophic; it is also deliberate, considered and
purposeful.
This lecture will address some of the destructive policies
and measures imposed on the Gaza Strip and their economic and social impact. I
argue that as a result of these policies, Gaza is being rendered unviable and by
that I mean dispossessed of the capacity for sustainable economic growth and
development on the one hand, and increasingly incapable of effecting social
change on the other.
Setting the Stage: Some Key Contextual
Transformations
I would like to begin by briefly addressing some key
contextual transformations or paradigm shifts in the way Gaza specifically and
the Israeli/Palestinian conflict generally is understood. These contextual
transformations, which I have written about in great detail elsewhere, provide
an important backdrop to this discussion.
The first of these paradigm
shifts emerges from the policy of separation, which so powerfully defines Gaza,
and the denial of territorial contiguity to which it is linked.
With the
Oslo political process, the historical contest over territory was replaced by a
policy of separation, isolation and containment that goes well beyond occupation
and is arguably most striking in Gaza. A critical turning point came in 2005
with then Israeli Prime Minister Sharon's so-called disengagement from the Gaza
Strip. With this policy Israel laid the framework for a new unilateral approach
that not only ended the pretense of negotiations, it made the separation of the
occupied territories a political, economic and demographic reality.
The
denial of territorial contiguity derives from an important paradigm shift that
views Israel’s occupation as normal, manageable and routine. The steady and
rather seamless normalization of the occupation over the last two decades in
particular has remained unchallenged by the international community - a damaging
reality to which it largely acceded.
The normalization of the occupation
assumes an extremely compelling form in the Gaza Strip. Unlike the West Bank
where it is seen in the expansion of settlements, in Gaza it is seen in the fact
that its status as an occupied territory has ceased to be a matter of real
international concern, the focus of attention having shifted - after Hamas’s
2006 electoral victory and 2007 takeover of the Gaza Strip - to Gaza’s enforced
isolation, containment and punishment.
Hence, the Israeli/Palestinian
conflict has been reshaped to center on Gaza and on Israel’s hostile
relationship with Hamas. Consequently, the occupation has been transformed from
a political and legal issue with international legitimacy into a simple border
dispute where the rules of armed conflict, not of occupation, apply. This new
interpretation has been made explicit in the case of Gaza. This represents
another critical paradigm shift in the way the Israeli/Palestinian conflict is
understood and addressed.
The international community, again, has largely
come to accept Israel’s recasting of its relationship with Gaza from one between
occupier and occupied to one between warring parties, facilitating Israeli
attacks on Gaza and rendering as illegitimate any notion of human rights or
democracy for Palestinians.
This recasting is strikingly reflected in
critical changes in Israel’s economic policy toward Gaza (and the West Bank).
Whereas previously, policy sought to control and dominate the Palestinian
economy, shaping it to Israel’s own interests (as during the first two decades
of occupation), current policy attacks the economic structure with the aim of
disabling it. Perhaps most striking of all is the transformation of
Palestinians, especially in Gaza, from a people with national, political and
economic rights into a humanitarian problem, a demographic presence in an
impoverished enclave, unable to mobilize politically, and dependent on the
"goodwill" of the international community which is now responsible for
them.
The Government of Israel (GOI) has, in fact, explicitly referred to
its intensified closure (or siege) policy in Gaza as a form of "economic
warfare." The government stated, "damaging the enemy’s economy is in and of
itself a legitimate means in warfare and a relevant consideration even while
deciding to allow the entry of relief consignments." This form of warfare is
also seen in the termination of the customs code or customs clearance for Gaza
needed for imports into the territory, and the imposition of Israeli-controlled
buffer zones on Gaza’s land and sea. All these measures are intentionally
designed to undermine and deplete Gaza’s economy and productive capacity,
measures seldom justified on security grounds.
In a November 2008 cable
from the U.S. embassy in Tel Aviv released by Wikileaks, U.S. officials wrote,
"As part of their overall embargo plan against Gaza, Israeli officials have
confirmed (to U.S. embassy economic officers) on multiple occasions that they
intend to keep the Gazan economy on the brink of collapse without quite pushing
it over the edge" with the aim of having Gaza’s economy "functioning at the
lowest level possible consistent with avoiding a humanitarian crisis."
The policy of economic warfare is reflected in another dangerous
transformation. Since the assumption of Hamas to power, Israel’s goal is no
longer simply Gaza’s isolation and disablement, but its abstraction and
deletion. Israeli policy has shifted from addressing the economy in some manner
(whether positively or negatively) to dispensing with the concept of an economy
altogether. That is, rather than weaken Gaza’s economy through punishing
closures and other restrictions, as had long been the case, the Israeli
government imposed an intensified closure or siege that treats the economy as
totally irrelevant, "a dispensable luxury." The impact of Israel’s policy shift
is clear in what was until recently, the near total collapse of Gaza’s private
sector, the driver of economic growth to which I will return.
For some
time, it has not been a question of economic growth or development, change or
reform, freedom or sovereignty. Rather, for Gaza, the issue is now largely one
of essential humanitarian needs, of reducing the needs and rights of 1.65
million people to an exercise in counting truckloads of food. In this way,
Israeli policy diverts attention from, and in fact justifies, the destruction of
Gaza’s economic infrastructure and productive capacity, goals accelerated
during Operation Cast Lead (OCL). Thus Gaza’s already fragile economy has been
transformed from one driven in large part by private sector productivity to one
largely dependent on humanitarian assistance and black market
trade.
Some Critical Factors Contributing to Gaza’s
Unviability
Here I am going to focus on three areas: Israel’s
blockade, Gaza’s tunnel economy and the buffer zone and the despoliation of the
agricultural sector.
Israel’s blockade of Gaza and the diminution of
the private productive sector
In its 2011 report on poverty in Gaza
and the West Bank, the World Bank revealed the degradation of Palestine’s
reality:
Following the Second Intifada of 2000, the Palestinian
economy began to resemble no other in the world. Limited say over economic
policies and trade, the extent of dependence on Israel and international aid and
a regime of internal and external closures has created an economy characterized
by extreme fluctuations in growth and employment and an increasing divergence
between the two territories: the West Bank a fragmented archipelago; and Gaza an
increasingly isolated island.
Despite the many controversies
surrounding the Gaza Strip in recent years, the most crucial issue confronting
the territory is a ruinous, six-year long blockade that ended the normal
functioning of the economy, especially trade. The blockade has combined severe
economic restriction, isolation, and continued military assault to severely
undermine Gaza’s private sector and productive base, introducing several new and
damaging dynamics to a region that is one of the most densely populated in the
world, more crowded even than Tokyo, [Japan].
Historically, the Gaza
Strip and West Bank effectively formed a single economy, and the Gaza Strip was
an "indispensable part of the Palestinian economy, accounting for 35 percent of
total GDP in 2005..." This unity was reflected in the Oslo Accords and in U.S.
policy. Israel and the West Bank combined were Gaza’s primary market and because
of this the "ban on the marketing of goods to Israel and the West Bank is the
main impediment to sustainable economic development in the Gaza Strip."
Although closure has a long history in Gaza dating back to 1991,
restrictions became more acute after 2000 during the second Palestinian uprising
and particularly onerous after Hamas’s 2007 takeover of the Gaza Strip when the
closure was intensified, preventing the import of raw materials and the export
of finished products - thus, ending normal trade.
The impact on the
private sector was dramatic. For example, prior to the intensification of the
closure (or siege), 54 to 58 percent of Gaza’s employment was generated by the
private sector and concentrated in manufacturing, agriculture, construction, and
services. Gaza’s manufacturers imported 95 percent of their inputs and exported
their finished products primarily to Israel and the West Bank (which received
"90 percent of [Gaza’s] garments, 76 percent of furniture products and 20
percent of food products)."
However, by May 2009, only 30 to 40
commercial items were allowed to enter Gaza compared to 4,000 to 7,000 prior to
the blockade, increasing to just 400 commodities by May 2012 with virtually none
allowed for export. Consequently, between June 2005 and September 2008 at least
95 percent of Gaza’s 3,900 industries were forced to close while the remainder
operated far below their capacity. Around 100,000 people out of the private
sector’s benchmark capacity of 120,000 lost their jobs. This was prior to
Operation Cast Lead.
Perhaps most critically, Israel’s policy of
"economic warfare" banned virtually all exports, which remains the case, and is
a major constraint on the manufacturing sector, "with Gaza starkly transforming
from a potential trade route to a walled hub of humanitarian donations," wrote
the World Bank in September 2008. For example, the UN reported that between
January to May 2007, Gaza exported around 4,800 truckloads compared with 130
truckloads exported between January to May 2012, around 3 percent of its
pre-June 2007 amount. This despite a promise in the 2005 Agreement on Movement
and Access (AMA) to allow 400 truckloads of exports each day. Hence, during the
first five months of this year, Gaza was allowed to export one-third of what the
AMA promised as allowable exports for one day.
The main exception to the
export ban involves a limited number of farmers who have, since 2007, been
allowed to export flowers and strawberries to Europe only, part of a program
funded by the Dutch government to bring Gaza produce to European markets. By
June 2012, the rate of exports from Gaza stood at around two to three percent of
its pre-June 2007 level.
Furthermore and most important, not one
truckload with certain, recent minor exceptions, has been allowed to export to
Israel or the West Bank since June 2007, Gaza’s traditional markets, where
demand and profitability are higher (and despite the fact that Palestinian
exports destined for Europe naturally enter Israel and are subject to an intense
security screening). According to GISHA and the IMF, Israel has long been
blocking a variety of profitable transactions including furniture orders for
Palestinian Authority [PA] schools in the West Bank—one or two of which have
recently been filled, citrus fruit to West Bank grocers, and textiles to Israeli
companies, clearly showing that the restrictions have little if anything to do
with security and instead are directed at maintaining the separation of Gaza and
the West Bank, depriving Gaza and precluding the possibility of a unified
economy.
The current (2012) Israeli government has apparently renounced
the policy of "economic warfare" in favor of "separation," which continues to be
a political (rather than a security) decision producing the same effect. Thus,
normal trade (upon which Gaza's tiny economy is desperately dependent) continues
to be thwarted and prohibited despite a marginal easing of restrictions on
certain imports and exports, which was announced by the Israeli government in
June 2010. One should not forget that despite a limited relaxation of trade
restrictions, there has been virtually no change with regard to the movement of
people between Gaza, the West Bank, Israel and the world, confining the
overwhelming majority of the population, including the labor force, to the
Strip.
While there is no longer a shortage of food, the World Bank
states, "Access to Gaza remains highly controlled, and only consumer goods and
construction material for donor supervised projects are allowed in. Products
from Gaza to the West Bank and Israeli markets... are prohibited. Only small
shipments of certain agricultural and manufactured products are exported to
other markets through donor-supported projects. East Jerusalem, which is
considered a highly lucrative market, is beyond reach." In fact more
construction materials have been entering Gaza through the tunnels from Egypt
than from Israel.
A diminished and noncompetitive private sector, the
inability to trade freely within and outside the Palestinian territories, and
severe restrictions on the mobility of labor provide a powerful illustration of
economic disablement and the impoverishment it produces. One outcome is high
unemployment and persistent unemployment even in the face of some impressive but
transient private sector growth after 2010. By June 2012, for example,
unemployment stood near 30 percent of Gaza’s labor force and could easily return
to the even higher levels of the previous two years (having reached 47 percent
in 2010 according to UNCTAD ). The CIA found that the Gaza Strip ranked
seventeenth in terms of unemployment rates and the West Bank ranked forty-sixth
among 196 countries and territories. More significantly, in early 2012 the
unemployment rate in Gaza for those aged 15 to 29 years was 46.9 percent
(compared with 29.8 percent in the West Bank).
Chronic unemployment is
linked to poverty. Approximately 39 percent of Gaza’s people lived below the
poverty line in 2011 - double the West Bank rate - a percentage that would be
far greater without donor aid. According to UNESCO, this figure reflects "no
reduction in poverty since 2009" which is concerning given the impressive growth
in real Gross Domestic Product [GDP] in the period 2009 to 2011, "implying
that... high economic expansion did not manage to lift households out of
poverty."
Furthermore, in the absence of any human disaster or a shortage
of food, approximately 44 percent of people are food insecure meaning they do
not have access to enough food to meet their dietary needs. This situation
obtains despite UN food distributions to over one million people and the
economy’s recent high growth rates.
"From the needle to the rocket:"
Gaza’s tunnels - Formalizing the informal economy and other
distortions
The devastating restrictions imposed on Gaza’s formal
trade lines gave rise to a black market tunnel economy. Tunnels have existed in
the Gaza Strip since the 1980s. Between 2007 and 2008 their numbers mushroomed
from a few dozen to 500 with current estimates as high as 1100 to 1200 although
anywhere from 200 to 600 tunnels are believed operational.
The tunnels,
which are almost entirely devoted to smuggling goods into Gaza (with limited
exports), have become Gaza’s primary trading route, a critical lifeline for, and
driver of, the local economy, allowing it to mitigate the pressures imposed by
the blockade. By 2012 the tunnel economy (with and via Egypt) had become Gaza’s
principal economic engine accounting for 80 to 90 percent of its trade valued at
close to $700 million annually, and for marked increases in private sector
employment. Nicholas Pelham, who has written extensively on the tunnel economy,
similarly observed, "All told, the tunnels have kick-started Gaza’s
reconstruction, propelling it out of the darkest days of the siege. Imports have
triggered a building boom... [and] Gaza resembles a vast construction site."
Once Gaza’s smuggling trade began to assume more formal commercial
dimensions, the Hamas government moved to regulate it, establishing a regulatory
authority known as the Tunnel Affairs Commission (TAC), translating what was
"[o]nce a tax-free enterprise to escape closures [into] a source of domestic
revenue."
In its drive to formalize the tunnel economy, the Hamas
government, writes Pelham, established an "increasingly comprehensive customs
regime, providing it with a new revenue base that partially compensated for the
Ramallah-based PA’s monopoly on customs revenues collected at Israeli’s ports."
I will not list all the fees imposed except to say that the taxes on tunnel
goods (consumer items and inputs and raw materials for construction) have proven
extremely lucrative. For example, according to Omar Shaban, an economist in Gaza
who studies the tunnel trade, the government levies the following taxes: fifty
cents on every liter of gas, with 500,000 liters brought in daily; eighty cents
on each of the 300,000 packs of cigarettes that enter Gaza each day; $15 on
every ton of construction steel with 300 tons entering every day; and $10 per
ton of cement with 2,000 tons imported daily. These four commodities alone yield
the Hamas government an annual income of $188 million. Hamas also regulates many
types of businesses - from street vendors to Gaza’s 20 money-changing companies
- by requiring them to pay license fees. Taxes are also collected on a variety
of "luxury" items such as cars coming from Israel in order to compensate for
lost tunnel income after 2010 when imports from Israel increased.
Import
taxes on tunnel goods allowed the government to raise "over half of its $750
million 2011 annual budget locally," while the tunnel trade generated rising
levels of employment especially in the construction sector, and improved some of
Gaza’s public infrastructure including government buildings, police stations and
mosques. The Gaza-Rafah highway was widened, while parks and coastal areas were
beautified. In fact, the tunnel economy as a whole was, at its peak in 2010,
"Gaza’s largest non-governmental employer and its largest employer of youth"
with some 5,000 tunnel operators and 25,000 workers supporting some 150,000
people - around 10 percent of the population.
An extremely crucial aspect
of the tunnel trade is its size, which has dwarfed official trade with Israel,
outstripping formal trade supplies. For example, by February 2012 a monthly
average of 1,600 tons of cement came through Israeli crossings compared to
31,000 tons received through the tunnels. More strikingly, Pelham reports that
by mid-2011, 3,000 tons of cement entered Gaza daily; hence, in one day the
tunnels could supply nearly double the amount of cement that Israel delivered in
one month. This in turn has catalyzed a building boom addressing Gaza’s
desperate need for housing with large-scale investment from the Saudi
Development Bank, Turkey and Qatar.
The impact of the tunnel economy
(coupled with Israel’s easing of import restrictions) has been dramatic.
According to the UN, "As in 2010, construction activity was the single most
important element in private sector growth in 2011 in the OPT... In 2010 and
2011, Gaza’s annual average real GDP growth surpassed 20 percent and boasted a
stunning 23 percent GDP growth rate in 2011 alone - admittedly built on a very
low economic base devastated by years of closure. The number of people working
in construction more than tripled between 2010 and 2011 and overall employment
in Gaza grew nearly 25 percent (relative to 2010)." It is clear that the tunnel
trade is now the principal catalyst behind Gaza’s booming construction sector
and GDP growth "precipitating... Gaza’s postwar reconstruction while donors
remained on the sidelines."
Consequently, according to Robert Serry, the
UN’s Middle East peace process coordinator, commerce in Gaza is now controlled
by "smugglers and militants" rather than by "international agencies and local
contractors who wish to produce goods entering through legitimate crossings,"
which have been crippled by Israel’s blockade policies. Hence, international
organizations, foreign businesses and the local business sector which use
established trade routes remain relatively weakened and often unable to compete
with Gaza’s underground trade despite an easing of restrictions by Israel, which
by one local account has "quadrupled the number of trucks [from Israel]
permitted to bring goods to Gaza," and despite an increase in donor-supervised
public works projects. This has "crushed" Gaza’s commercial class, which has
comparatively fewer economic assets, and increased the population’s dependence
on the Hamas government.
Yet, although Gaza’s GDP was driven higher by
construction, commerce, foreign aid and consumption, the productive,
labor-intensive industrial and agricultural sectors of the economy benefited
relatively little from the enormous wealth being generated in the Strip. One
critical illustration is seen in the low level of investment in the economy,
around 9 percent of Gaza’s GDP in 2011, with little directed to plant, equipment
and other productive inputs. Rather, investment is increasingly directed to
residential construction and land where speculation and profits are high. Thus,
strong GDP growth did not contribute to a strengthened capacity for future
production and employment.
The tunnels have allowed Hamas to consolidate
its hold on the territory, circumvent U.S.-led international financial
restrictions, and in, effect, build its own economic system. This is no doubt
one reason why the Ramallah PA has called on the Egyptian government to destroy
all the tunnels. Yet, the tunnel trade is under some threat following the 5
August 2012 terrorist attack that resulted in the death of 16 Egyptian soldiers
in the Sinai. In response the Egyptian army destroyed 120 tunnels, around 10
percent of the total number, and temporary closed the Rafah crossing, which
surprised the Hamas government. In response Hamas proposed a free trade zone on
the border as an alternative to the tunnel trade, which President Morsi recently
rejected, leaving the tunnels the main source of goods into Gaza.
There
is more to say about the Egypt-Gaza relationship in this regard but for now
suffice it to say that the status quo - with limited changes - will continue
given that Egypt suspended the tunnel destruction soon after it began. The Rafah
crossing has been reopened with extended hours and with plans to allow 1,500
people to enter Egypt daily - a significant increase from an average of 450
daily entrants in 2011 to 2012.
Clearly there are many problems with the
tunnel trade which make it unsuitable for rehabilitating the productive sectors
according to the Israeli human rights organization, GISHA, which monitors
conditions in the Gaza Strip: trade is vulnerable to closure or attack by Israel
and Egypt and to political and economic conditions in both countries; trade is
overwhelmingly one-way; goods are of low quality; supply is unpredictable (as
seen in the ongoing fuel crisis caused by Egyptian-imposed restrictions
emanating from its own domestic shortages ); transit costs are high and there is
always the risk of damage to goods in transit despite improvements made in this
regard. Also, international organizations working in Gaza on a range of projects
cannot purchase anything through the tunnels given their linkage to the Hamas
government. Furthermore, increased construction activity - itself limited by the
small size of Gaza’s market - cannot serve as the basis for future economic
growth. In fact, some analysts predict that the boom will not last beyond two
years as most buildings will be completed and the housing stock
restored.
Other distortions have arisen as well. At least two new
economic classes have emerged in Gaza, a phenomenon with precedents in the Oslo
period. The first and arguably the most prominent is a new mercantile elite (of
black market traders and merchants) that has grown extremely wealthy from the
tunnel economy, providing them with a form of upward mobility unimaginable just
a few years before. In Gaza today there are reportedly over 850 millionaires and
"1,600 near-millionaires" who owe their fortunes to the new economic order and
likely have little if any incentive to change it. This creates an economic
anomaly in which productive sectors are greatly diminished while a small segment
of beneficiaries enjoy amazing growth. Furthermore, Pelham states, the tunnel
trade has created vested interests "between Sinai’s Bedouin traders,
transporters, and tunnel owners and Gaza’s consumers, which will not be easily
decoupled."
The second class consists of certain public-sector employees
(approximately 60,000) - civil servants and security personnel hired before 2007
- who are paid not to work (for the Hamas government) by the Palestinian
Authority in the West Bank. According to UNESCO:
PA support to
Gaza in the form of these salaries, [as well as] medical supplies and other
expenses is estimated to amount to $1 billion a year. Since the PA is unable to
collect taxes in Gaza and the tax revenue it collects on Gaza’s imports is
minimal, most of the PA’s expenditures in Gaza are being financed by
international aid. Gaza is thus basically being kept alive through external
funding, in the form of aid and remittances, and the illegal tunnel
economy.
However, these
salary subventions (together with payments to the UN for over 10,000 local
staff), amounting to $65 million each month, sustained Gaza’s liquidity and
purchasing power.
Both these phenomena have led to social and economic
disparities between the haves and overwhelming majority of have-nots that are
not only vast but visible as seen in the almost perverse consumerism in
restaurants and shops that is the singular domain of the nouveau riche and
wealthy. Increased spending power has led to further distortions. Since the rich
can only invest locally, land prices on the coast have risen dramatically as
have real estate prices, which are reported to have increased by 300 percent. In
fact the rise in real estate prices is so spectacular that property (per square
meter) in Gaza’s largest refugee camp, Jabalya, is reportedly nearly equivalent
to prices in Tel Aviv while Rafah is apparently more expensive than
Cairo.
Without doubt, the six-year long blockade coupled with OCL have
introduced and institutionalized dynamics that have undermined Gaza’s formal
economy in favor of "a pseudo official black market" that is becoming
increasingly formal in an environment where donor aid is a principal driver of
the economy, reducing economic behavior to its lowest common denominator:
consumption.
Although the tunnel trade can and should be understood as a
form of empowerment and self-sufficiency providing critically needed goods and
jobs in an extremely adverse environment, it still represents a dangerous and
increasingly damaging reconfiguration of economic activity despite the growth in
output and employment it has generated.
Gaza’s tunnel economy was as
Pelham argues, "a remedial answer to the blockade, not an economic solution."
Because of this its multiplier effects (including increases in private sector
employment) cannot begin to compensate for the decline of the formal economy as
seen in the virtual end of export trade and the attendant erosion of the
manufacturing and agricultural sectors. This is why despite the recent growth in
Gaza’s GDP, it remains below its level in 2005 and 1994. As Oxfam observes, "the
scale of economic activity remains heavily dependent on local demand in Gaza,
which in turn is constrained by the low purchasing power of the population and
the relatively small size of the local market," again underlining the critical
need of Gaza’s small, resource-strapped economy for access to external
markets.
Furthermore, by bounding Gaza’s economy in this way, which
propels Gaza toward a still less-than-welcoming Egypt, Israel is able to further
deepen the separation and isolation of the occupied territories and prevent the
emergence of a Palestinian state, Israel’s primary goal. Gaza is removed as an
integral part of Palestine, eliminating any possibility of a larger Palestinian
economy capable of sustained growth and development, which could support a
sovereign Palestinian state and compete with Israel. The result, said Meron
Benvenisti nearly ten years ago, will be a state that is "limited to the height
of its residential buildings and the depth of its graves." Debilitating Gaza’s
economy is the key to debilitating Palestine’s.
As a colleague in Gaza so
powerfully put it: "The world has long gone airborne and has increasingly gone
wireless. The world’s economy has become border-less and virtual. And here we
are, digging ourselves into the sand."
It is perhaps in Gaza’s
agricultural sector that Israel’s intentions are most visible and Gaza’s
unviability most striking. Gaza's agricultural sector, once an important part of
the economy, has been severely degraded if not effectively destroyed. The
virtual ban on Gaza’s exports that I have already discussed act as a severe
constraint on agricultural output and employment.
However, there are
other reasons for the sector’s dramatic decline. A key factor is a buffer zone
or "access restricted area (ARA)" that has been unilaterally imposed by Israel
on the Gaza Strip’s land and sea since the start of the second Palestinian
uprising in September 2000 and gradually widened. Buffer zone areas are totally
or partially inaccessible to Palestinians. The most striking data are these: the
new extended buffer zone, identified by the UN as a hazard and danger zone and
based no doubt on firings into the area, now extends one kilometer into Gaza,
well beyond the 300 meters designated by Israel. Consequently, the buffer zone
now absorbs nearly 14 percent of Gaza’s total land area and encompasses
approximately 48 percent of the Gaza Strip’s total arable land (including many
groundwater wells and roads). Remember the most arable land in the Gaza Strip is
along and within the buffer zone.
Indeed, the UN reports that buffer zone
restrictions result in an annual loss of about "75,000 metric tons of potential
produce," which is equivalent to just under 83,000 (U.S.) tons. Similarly, the
extended buffer zone in the sea covers 85 percent of the maritime area promised
to Palestinians in the Oslo Accords; 20 nautical miles (nm) has been reduced to
3 nm. In fact, it was during OCL that both the arable land and maritime area
suffered their greatest losses.
In order to enforce the buffer zone,
which Palestinian armed groups have used against Israeli targets, the Israeli
Defense Forces (IDF) have used a variety of violent means including incursions
and land leveling operations. According to Al Haq, "land incursions into the
buffer zone [occur] an average of three to four times every week." In 2011 the
Israeli army engaged in at least 69 land leveling operations and incursions that
took place beyond the 300-meter limit, which has "damaged Gaza’s topsoil in
prime agricultural areas." Incursions have resulted in damage to civilian
infrastructure e.g., homes, schools, water and sanitation facilities, a water
reservoir and a newly built sewage pump station.
Land leveling
operations, however, have raised concerns among some analysts that go well
beyond immediate damage and loss, suggesting a policy that may be concealing a
greater outrage. For the leveling of land is not only about the destruction of
agricultural crops and restricting access to food but also about what is being
done to the soil itself.
In the final days of OCL, 200 bulldozers working
along Gaza’s eastern border inflicted much if not most of the destruction. 7,847
acres of agricultural land - citrus trees, other fruit bearing trees,
greenhouses, nurseries, farms etc. - were bulldozed and flattened by tanks and
tracked vehicles moving back and forth, compacting the soil. Approximately
5,000 acres were flattened in the buffer zone and 2,847 acres were damaged or
destroyed throughout the 16 sub-districts of the Gaza Strip. Combined these
areas account for one-third of Gaza’s total arable land that is now out of
production. In fact OCL alone imposed over $250 million in damage, destroying
vital agricultural assets.
The bulldozing of land and compaction of the
soil raises some potentially serious problems. It creates a situation that
forces farmers to deep plow. However, deep plowing without sufficient
irrigation, which remains a serious problem in the buffer zone due to the
destruction of ground water wells - the main source of irrigation - will
turn the land into a non-arable dustbowl.
Non-arability is further
exacerbated by the suspected toxicities of some soils resulting from their
saturation by chemicals, sewage and weapon debris. In fact by deep plowing in
this way, Palestinian farmers are contributing to the soil’s destruction,
unwittingly or not. The resulting desertification process will, in the absence
of any remedial measures, insure that the land becomes totally irredeemable. The
Israeli authorities reportedly refuse access to the land for soil testing nor
will they allow farmers to import pumps, which could be used to repair damaged
agricultural wells. According to local sources, the land area between Beit
Hanoun in the northern Strip and the Israeli border fence is now 80 percent
devastated.
Given the enormous losses in arable land and fishing area -
which may grow wider in the future - and the other restrictions imposed, it is
not unreasonable to conclude, as the United Nations Environmental Programme has,
that Gaza’s agricultural economy "may indeed be finished."
Another
critical constraint on agriculture, the economy and the people is water. Water
is an extremely serious problem and has been for decades due to over pumping
from the coastal aquifer, allowing seawater to enter and pollute fresh water, a
problem made worse by the unlicensed and unregulated drilling of more than 4,000
wells by Palestinians. On a visit to Gaza in the summer of 2012, Martha Myers,
the Director for Relief and Social Services for UNRWA, commented on the quality
of domestic water: "It's not like drinking seawater; it is drinking
seawater."
The aquifer has also been contaminated by decades of
infiltration by sewage and agricultural fertilizer. Due to the breakdown of
Gaza’s sanitation infrastructure, the sewage flow in the Gaza Strip together
with other contaminants leaching from waste dumps have led to elevated levels of
nitrates and chlorides in the groundwater and soil, which pose a serious risk to
humans and livestock. Since 2008, between 60,000 to 90,000 cubic meters (CM) of
untreated or partially treated sewage enter the environment and the
Mediterranean Sea daily (polluting the aquifer, the fishing waters and the
beaches) with clear regional implications.
In 2012, 25 percent of
wastewater or 30,000 CM per day is treated and reused in some form for
agricultural purposes while 90,000 CM of raw or partially treated sewage is
released into the environment daily. This is the equivalent of 23,775,500 U.S.
gallons of sewage being dumped into the environment every day.
A 2009
UNICEF and Palestinian Hydrology Group study reported that "concentrations of
chloride and nitrate, which is a component in fertilizer and is found in human
and animal waste, are as much as ten times the safe levels established by WHO."
EWASH, an NGO representing over 30 organizations working in water, sanitation
and hygiene in the West Bank and Gaza, similarly argues that most of the Gaza
Strip contains groundwater where the nitrate concentration is well above the
acceptable WHO level, finding that "90 percent of water wells are contaminated
with nitrates between two and eight times higher than WHO
standards."
Remedial actions are largely prevented by Israel’s blockade
policy, which limits and prevents the entry of materials needed to repair,
maintain and upgrade Gaza’s sewage, wastewater treatment and storage
infrastructure, which is unable to cope with demand or lacks sufficient fuel to
operate. In fact, according to EWASH "[l]ess than 20 percent of the needed
materials for essential water/sanitation projects, that would alleviate many of
the problems faced in Gaza, have been allowed in through the Israeli-controlled
crossing, two years after Israel announced the 'easing' of the blockade in June
2010."
In 2011, furthermore, Save the Children reported that airstrikes
"destroyed $1.3
million worth of water and sanitation infrastructure, including a new sewage
pumping station connecting 130,000 residents in Al Nuseirat and Bureij to the
main sewage system."
They also found (in September 2010) that "1.1 million Gazans in nearly half of Gaza’s
municipalities are at high risk of consuming biologically contaminated drinking
water from private vendors, the source of water for most Gaza residents.
Bacteriological contamination (either from poor hygiene in the home or
contaminated water) was found in 63 percent of households
sampled." Furthermore,
"The compound problem
of Gaza’s depleted aquifer, a lack of a proper sewage treatment and disposal
system, and the difficulties of providing adequate service-delivery has produced
a grave environmental situation with significant health
risks." According to the
American Near East Relief Agency (ANERA), 26 percent of disease in Gaza, is
water-related. It is not unreasonable to assume that water and soil
contamination may become chronic and possibly irreversible as long at the
blockade denies the importation of essential inputs needed to address the
problem.
The internal findings of another international donor agency
concluded, "Nowhere else in the world has such a large number of
people been exposed to such high levels of nitrates for such a long period of
time. There is no precedent, and no studies to help us understand what happens
to people over the course of years of nitrate poisoning."
A comment on
social decline
Social decline has many dimensions. Here I would like
to touch upon two issues that have particular relevance for Gaza’s unviability:
the health of the population and the impact on social attitudes of an economy
that has been disabled.
Some issues related to the health of the
population
Clearly the health of economy and the environment will
determine the health and wellbeing of her people and vice-versa. For example, it
is not surprising that Gaza’s worsening economic and environmental conditions
combined with high fertility and population growth rates have resulted in rising
malnutrition among Palestinian children below the age of five. Between 2000 and
2010, the prevalence of malnutrition rose by 41.3 percent nationally and 60
percent in the Gaza Strip. Stunting (low height for age), which is an
indicator of chronic malnutrition, has become increasingly frequent among Gaza’s
children under five, affecting 9.9 percent of them in 2010. According to the
Palestinian Central Bureau of Statistics (PCBS), children in Gaza are twice as
likely to live in poverty as children in the West Bank.
Nutritional
deficiencies, particularly Vitamins A and D, are high among Gazan children under
three due in part to dihedral infections that are linked to the lack of access
to clean water. "In
addition," states EWASH,
"the prevalence of
anaemia [due to a dietary iron deficiency] is so high that it indicates a severe
public health problem according to the WHO classification
system." Between 68 to 74
per cent of infants aged 9 to 12 months suffer from anaemia as do 59 percent of
schoolchildren and 37 percent of pregnant women. According to the WHO, the most
serious consequences of anaemia include "poor pregnancy outcome, impaired physical and cognitive
development, increased risk of morbidity in children and reduced work
productivity in adults. Anaemia contributes to 20 percent of all maternal
deaths." A 2012 report
issued by Save the Children UK, stated, "Diseases of poverty and conflict combined with a
degenerating health care system are claiming growing numbers of Gaza’s
children."
There is rising concern among Palestinian and
European specialists with regard to the reproductive health of Gaza’s
population; a reported rise in the number of birth defects and congenital
anomalies after OCL; the increase in the number of abortions; and a reported
increase in the incidence of cancer after OCL. This is due not only to soil and
water contamination but also to the possible use of toxic weaponry during OCL.
Although this area of research remains inconclusive and highly contentious, one
European military analyst revealed that 55 tons of munitions were dropped on the
Gaza Strip in three weeks (of the 2008/09 invasion). "The deep penetrating munitions used
to destroy some tunnels along [Gaza’s southern border] were so destructive that
part of the city of Rafah began to sink."
He also revealed that "witnesses further [stated] that
following these attacks IDF engineers entered the area and replaced the
top-soil. Such an action may have been intended to prevent possible depleted
uranium-impregnated dust from being carried into the territories of southern
Israel by the prevailing westerly winds." Another expert privately indicated that although
the available data are still incomplete, they suggest the possibility that the
number of birth deformities in Gaza will rise, possibly as soon as
2014." Although the
requirement for validity is very high, and is perhaps impossible to prove, the
concerns raised are real and not without foundation.
Changing social
attitudes: Some emerging patterns
Interviews with colleagues and
friends in Gaza revealed some common themes regarding the ways in which social
attitudes have been affected by Gaza’s altered economic reality, attitudes which
will impact Gaza’s future. There is real concern that professionals and
academics, unable to travel abroad for training and higher education, will loose
their skills and expertise. According to the Portland Trust, a British NGO
working in economic development, "The longer the situation continues the greater the risk
of an irreplaceable loss which could take more than a generation to
recover."
Severed from
the outside world, the position of women has also weakened in Gaza’s
increasingly conservative society. One indicator is found in the rising levels
of domestic violence. According to the PCBS, 51 percent of all married women
reported being abused by their husbands over the last year. Women, more of whom
have economic responsibilities outside the home, remain the primary caretaker of
their families and must confront on a daily basis the practical consequences of
a terribly compromised reality: the lack of access to clean water, nutritious
food, medical care and education; poor housing; and insufficient electricity
among many other problems.
Another prominent concern centers on what
happens to a once productive and motivated population who have been forced into
a state of non-productivity, of near-total dependence on humanitarian aid just
for basic sustenance. This deprivation is deliberate and imposed on a people
desperate and able to work. Although some resist and seek creative ways to move
forward, many others do not. In the words of one
analyst,
Tens of thousands continue to receive a salary from the PA in
Ramallah
for doing nothing [while] the... government in Gaza has been paying
other tens of thousands, most of whom have been hired to replace those who were
ordered by the PA to stay at home. Hundreds of thousands continue to receive
"humanitarian" aid from UNRWA and other donors just to keep their heads above
water... the rest [have] no one to look out for [them] except
private generous citizens and NGOs.
In virtually none of these cases
does one see any [attempt to exploit] people’s potential to work, produce and
earn their living even though people in Gaza are eager to work and produce. All
those who intervene in Gaza - PA, local authorities, UN or others - are, in
effect,
acquiescing to this reality. No one seems to properly... challenge the
political... or economic aspects of internal division and of Israel’s
successive policies of keeping Gaza alive but constantly needy and isolated...
unable to earn its own living even though it very well could.
In this regard, not only are Israel and donor governments culpable
but
so too are the Palestinian Authority governments in Gaza and the West Bank
whose
internal struggle for power - especially over the flow of assistance and the
movement of humanitarian aid workers - further diminish any possibility of
economic reform.
And last is a theme that has been constant in my work
since it began 27 years ago: the assault on human dignity and now, its seeming
absence. Dr. Rajaie Batniji, a Stanford University physician, wrote a powerful
essay in the British medical journal, The Lancet, about a recent trip to his
family in Gaza in which he echoes Hannah Arendt’s observations with which I
began this lecture. He writes, "...Gaza is something of a laboratory
for observing an absence of dignity." The violations of dignity include
"not being seen or being incompletely seen; being subsumed into a group
identity; invasion of personal space (including physical violence); and
humiliation... The constant surveillance from the sky, collective punishment
through blockade and isolation, the intrusion into homes and communications,
and
restrictions on those trying to travel, or marry, or work make it difficult to
live a dignified life in Gaza."
In fact during the period between
February 2009 and August 2012, 1,059 incidents against Gaza took place, an
average of six incidents per week. They were generally of four kinds: attacks
by
aircraft, helicopter gunships, drones and tanks throughout Gaza even in densely
populated areas; attacks against fishermen involving the confiscation of, or
damage to, fishing boats and other equipment, and the detention and arrest of
fishermen; attacks on industrial, farm and food production facilities and
related infrastructure; and ground incursions by the IDF into Gaza’s buffer
zone
and into Gaza proper.
And, Batniji continues, it is not just the
Israeli occupation and siege that are at fault but the internal power struggles
among Palestinians, which has "recreated many of the most threatening aspects
of
the Israeli occupation [including] barriers to movement of people and goods,
fear, isolation and torture." To these divisions add the exigencies of daily
life, which force people to hoard fuel and other necessities and depend
disproportionately on foreign assistance to eat, then it is no surprise that
"[m]any people on the street now walk with their heads down - whether it is out
of
fear, isolation, or a loss of dignity... intentionally neglect[ing] the
destruction that surrounds them."
The words of a 17 year-old boy
detained in an Israeli prison captures the essence of life in Gaza, "What it
feels like to live here you ask? It’s like being a shadow of your own, caught
on
the ground, not being able to break out and you see yourself lying there, but
you cannot fill the shadow with life."
A personal and concluding
reflection
Palestinians in the Gaza Strip are entrapped in what
Professor Nadera Shalhoub-Kevorkian of Hebrew University terms "a zone of
non-existence." In this zone, she argues, one finds "new spaces of obscenity in
the politics of day-to-day lives" where engaging in normal, everyday acts
of living and working - going to school, visiting neighbors, traveling abroad,
planting a tree, growing vegetables and selling products in a nearby market -
are
treated as criminal activities, punishable, in some instances, by death.
In these obscene spaces, innocent human beings - most of them, children - are
slowly
being poisoned by the water they drink, all with the knowledge and acquiescence
of the world community.
This disfigurement of everyday life is, for me,
as a Jew, painfully symbolized in the Star of David that was gouged into Gaza’s
soil during Israel’s 2008 war on the territory. Yet the desecration of the land
in this way not only points to the destruction of a way of life and means of
survival for Palestinians, it embodies the limitations of Israeli power and the
failings of Jewish life as well. No doubt those who wrested the Star of David
from Gaza’s land meant to convey the presence and the power of the Jewish state
over the destiny of others. Yet this power is one of deprivation and ruin, and
it speaks profoundly to our own inability to live a life without the walls we
are constantly asked to build.
As I have hopefully shown, the
people of Gaza are being deliberately targeted and a crime against them is
being
committed. More than anything, this crime is found in the daily and
unrelenting assault on their economy and society for which the United States,
the European Union and various Arab states bear enormous responsibility
together
with Israel. Whether you deliberately shoot a human being through the heart
with
a bullet or deprive him of a home, livelihood, and the means to care for his
children, you are saying to that human being that he has no right to exist. In
this way, among others, Gaza speaks to the unnaturalness of our own condition
as
Jews. For in Gaza, we seek remedy and consolation in the ruin of another
people, "[o]bserving the windows of [their] houses through the sites of
rifles,"
to borrow from the Israeli poet, Almog Behar. It is ironic then that
our own salvation now lies in Gaza’s. And no degree of distance or separation
can ever change that.
Dr. Sara Roy is a senior research scholar at the Center for
Middle Eastern Studies at Harvard University where she completed her doctoral
studies in international development and education. Trained as a political
economist, Dr. Roy has worked in the Gaza Strip and West Bank since 1985
conducting research primarily on the economic, social and political development
of the Gaza Strip and on U.S. foreign aid to the region. Dr. Roy has written
extensively on the Palestinian economy, particularly in Gaza, and has
documented
its development over the last three decades. Her most recent book, Hamas and
Civil Society in Gaza: Engaging the Islamist Social Sector, was published
last year by Princeton University
Press.
This
transcript may be used without permission but
with proper attribution
to The Palestine Center. The speaker's views do not necessarily reflect the
views of The Jerusalem Fund.
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