Gaza Economy Suffocated by Restrictions
Associated Press
Date: 09-07-05
By RAVI NESSMAN, Associated Press Writer
DEIR EL-BALAH, Gaza Strip - The sticky sweet smell of sugar, chocolate and marshmallow still hangs over the Al-Awda factory floor, though its owners have grown bitter about the fate of their cookie company.
Israeli security restrictions at the only terminal for Gaza's exports crushed their business over the past five years of violent conflict, forcing them to fire nearly half their workers and unplug some of the snaking machines that cut, bake and wrap cookies.
While many prepare to celebrate Israel's Gaza pullout, Palestinian leaders fear that without an Israeli agreement to open up Gaza's borders and allow businesses to freely export, the impoverished region will be doomed to a future of unending despair.
A continuing economic crisis in Gaza, where unemployment is 35 percent and many depend on foreign aid, could also undermine the Palestinian Authority and strengthen already popular Islamic militant groups.
Without the free movement of goods, "what did we get out of disengagement? Absolutely nothing, economically speaking," said Sani Daher, head of Paltrade, an organization of Palestinian exporters.
Currently the Palestinians' only export outlet is the Karni cargo terminal on the border with Israel, where lengthy security checks have created a bottleneck.
Palestinian officials hoped to open a second terminal ? this one into Egypt ? at southern Gaza's Rafah crossing after Israel pulls out in the coming weeks. The Palestinians offered to allow foreign monitors, possibly from Europe, at Rafah, as part of an agreement that could be replicated at a future Gaza port and airport.
But Israel refused amid fears that advanced weapons as well as militant leaders would infiltrate and turn Gaza into a terror haven. Instead, Israel proposed moving the crossing to the junction of Israel, Gaza and Egypt so Israel can retain a measure of control.
Palestinians rejected the idea, saying it would violate their sovereignty, also fearing the new border terminal would become another Karni.
Israeli Vice Premier Shimon Peres said Israel was working in good faith to reach an agreement that would allow the flow of goods and people across Gaza's border, though security was its top priority.
"Our intention is to create solutions, not to create problems," he said. "I am sure that a solution will be found," he said.
Reaching an agreement on the flow of exports is crucial to Gaza's success, international officials said.
"Increasingly this is how Gaza will have to earn its living, as opposed to be being supported by the international community," said Nigel Roberts, the World Bank's country director for the West Bank and Gaza.
Gaza's exporters view Karni as their source of oxygen. When it is open, their companies are healthy and energetic; when it closes, they wheeze, choke and eventually collapse.
On a recent day, workers unloaded everything from seafood to new classroom chairs and stacked them on pallets to be sent through Israeli X-ray machines inside a security barrier on the border. The goods were then loaded onto Israeli trucks on the other side.
Many of the gates processing goods were closed, and workers complained that Israeli regulations, which they said were constantly changing, further slowed the process.
Karni is processing only about 50 truckloads of goods a day, a fraction of its capacity, said Salim Abu Safia, the director of the Palestinian border authority. Israeli officials disputed the figures.
Gaza's businesses are ready to send between 130 and 150 truckloads of goods over the border daily, which the terminal could easily handle if Israel would send more X-ray machines and beef up the infrastructure, according to Daher, head of Paltrade.
"That will jump-start the economy in Gaza. The increasing production will encourage foreign and local investments and will increase, even more, exports," Daher said.
Businesses like Al-Awda are key to that economic recovery.
Mohammed Tilbani started the company 30 years ago, making sweets in his parents' house. He named his business Al-Awda, or "the return," to commemorate Palestinian refugees' desire to return to homes they fled in Israel during the 1948 Mideast War.
Over the years, the business exploded and by the 1990s, Al-Awda was selling about $670,000 worth of biscuits, chocolate wafers and pretzels a month, most of its products going to the West Bank and abroad. Al-Awda's factory in Deir el-Balah was bustling 24 hours a day to meet demand, even running shifts on Friday, the Muslim Sabbath, said Iyad Tilbani, Mohammed's son.
When Israeli-Palestinian violence broke out five years ago, Al-Awda's export line was cut. Karni was often closed for long stretches at a time, and even when it was open the flow of goods was at best a trickle.
Al-Awda's monthly sales plummeted. Nearly half the company's 350 workers were fired, and few of them found other jobs, Iyad Tilbani said.
"The intefadeh (uprising) destroyed us," he said.
Iyad Tilbani, 29, walked around the factory floor, where some workers stacked blocks of wafers rolling off conveyor-belt driven machines, and others packed biscuits in boxes. He pointed to another production line that once made cigar shaped chocolate wafers, but has been silenced since the Palestinian uprising started five years ago.
When Karni closes, the company shuts down production completely and sends its workers home, sometimes for a week at a time.
Mohammed Tilbani believes he can sell as much as $1.1 million worth of cookies a month with no restrictions, and he called on the Palestinian Authority to fight hard for a port, airport and open border for Gaza.
If they don't get it, he said, "We will return to war."
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