Introduction
As of 12/6/2007, the strangling siege over the Strip reached its eighth month and the siege's drastic results on all economic sectors of life in the Gaza Strip make it a catastrophic zone of the first degree, as 1.5 million citizens are living under the effect of the siege. The movement of people and goods from and to the strip is paralyzed, and all commercial transactions have been stopped in a manner that contradicts all agreements, intents, commitments and accords the occupation took upon itself with international organizations to facilitate the movement of goods and people within and outside Palestinian territories. They made three agreements on the matter, the last of which was reached in November 2005, relative to movement and transit. Yet, the occupation proceeded with its antagonistic and criminal policy that resulted in shredding the lives of Palestinian Arabs in the West Bank and the Strip. The Strip occupation acts have strangled whatever was left of its originally fragile economy resulting from the effects of Israeli occupation. The Strip, which depends entirely on its imports from and through Israel has been greatly affected. Since it started its siege, Occupation forces didn't allow any raw materials to be brought into the Gaza Strip, as well as forbidding Gaza from exporting its products, the outcome of which is an increase in the percentage of its inhabitants living under the poverty line to 85% as per some estimates.
Direct monthly losses as a result of the siege are estimated at 48 million US$, which are spread as follows: The industrial sector 16 million US$ namely, 34% of the total, agriculture 10 million US$, 20% of the total, trade, services and fishing 22 million US$, 45% of the total.
i. The Private Sector
Private sector productivity in the Palestinian territories in general and the Gaza Strip in particular had a sharp 76% decline from what it was at before the Al-Aqsa Intifada. Down to 31.1 during the first quarter of 2001, although it recovered some of its vitality to reach an average of 46% during the period extending between January 2006 and July 2006. But upon imposing the full siege on the Strip on mid July 2007, productivity decreased directly to 11%. The cause is due to Occupation authorities having stopped the application of the Customs Code for the Strip, which resulted in banning the importation of all raw materials especially. Since local raw material in all of Gaza's industrial facilities does not exceed 10%, noting that even this percentage is obtained with great difficulty, thus costs have increased more than the total cost of production. In addition to the difficulty in marketing locally produced products because of the siege, the ban on exportation has dealt a fatal blow to this sector of the economy.
Studies show that more than 43% of the private sector establishments had to decrease their commercial activities to a level exceeding 75%, while noting that 55% of these establishments had to shut down their operations.
ii. The Industrial Sector
The industrial sector depends completely on imported raw materials. It depends up to 80% on imported machines and spare parts, and during the peak season of production (May – June) it is possible to export 748 truckloads of industrial products per month (including furniture, food products, clothing and agricultural products).
Since the beginning of the siege, the Occupation cancelled the application of its Customs Code for the Strip, resulting in the stopping of all industrial activities, which depends up to 85% on imported raw materials that are imported from Israel or in transit through it, and statistics indicate that more than 96% of industrial establishments, a total of 3,900, were shut down, stopping the export of their product; as a consequence 35,000 out of 35,000 employees and workers in this sector joined the ranks of the unemployed up to the date of the imposition of the siege in mid June 2007, and after the siege the number of employed industrial workers does not exceed 1500.
Estimates issued by the Union of Palestinian Industries said that direct monthly losses since the beginning of the siege on the Strip is 15,000,000 US$, as the net daily income of the industrial sector in Gaza last year was 500,000 US$, which means that a total 95.5 of furniture workshops closed their doors up till the end of 2007, while statements issued by economic sectors shows a total loss of 120,000,000 US$. The affected sectors' statements indicate that no furniture exports, such as 95% of the wood industries, stopped production. Only 30 out of the 600 establishments in this sector are still working, a net loss of 55,000,000 US$ (8 million in July, 10 in August, 12 in October, 13 in November, and 12 in December) in addition to 6,500 workers who lost their jobs, 245 monthly truck loads of exports were stopped.
iii. The Agricultural Sector
The Gaza Strip has 70,000 donums (9364 Hectares) of agricultural land, with a production capacity between 280,000 to 300,000 tons of agricultural products per annum, one third of which is usually exported. The agricultural sector counts 40,000 permanent jobs for citizens in Gaza (namely 12.75% of the working force), it is also the source for food and life for one quarter of the population in the Gaza Strip. Since the beginning of the total siege, the Occupation banned the exports of its products including agricultural products out of the Strip, and furthermore, it prohibited the import of seeds and seedlings, fertilizers and other agricultural requirements, which caused big losses exceeding the original estimates since mid July up to end of 2007. These losses amounted to 65 million US$, and according to the Ministry of Agriculture statements, the average daily losses due the ban of agricultural products is 150,000 US$. Thus, a total loss during the last 8 months that amounts to 28,000,000 US$. About 25,000 tons of potatoes were destroyed and more than 10,000 tons of other products were destroyed or sold locally at much lower prices then those of export prices (local prices were 10 to 15% of the export prices). While other farmers suffered direct losses as a result of produce being sold locally compared to export prices, as a result of dumping the products produced for export purposes in the local market, it is expected that the total produce in the last season shall drop by 20 to 30% less than in the previous season. Thus, losses are estimated at 10 million US$ monthly.
The number of workers in this season is 7,500 farmers, whose estimated production is 14 million US$ which was supposed to be produced fully for export, as an area of 3130 donums (418 Hectares) is planted with strawberries, tomatoes and carnations.
On the other hand, and as a result of the difficulties in the fishing industry, estimates are that 3,000 fishermen are expected to lose their jobs with an estimated monthly loss of 3,000,000 US$.
iv. Health Sector:
The health sector has been exposed since Israeli Occupation imposed its siege on the Gaza Slip to a major blow, which affected its ability to provide the basic required health services to its citizens. During the most recent period, a great shortage of a large number of basic pharmaceutical needs, that is 76 types of medicines until the date of the preparation of this report, and another 120 kinds are expected to go out of stock within the upcoming days. This is in addition to the disability of 90 medical instruments to perform because of the lack of spare parts needed for their maintenance, among these machines are 31 kidney dialysis machines. Summed to all of this is the inability of citizens to travel abroad for medical treatment. Statements issued by the World Health Organization (WHO) stated that hundreds of patients with acute medical illnesses, and those which require highly specialized surgeries especially in the brain, nerves and bones, as well as the treatment requirements for cancer patients, and those with kidney and heart diseases, could not travel abroad for treatment. The Occupation refused to allow 1150 patients to leave the Strip for treatment since the beginning of the siege, out of which there were 270 serious cases. The Ministry of Health recorded dozens of deaths (more than 105 deaths) of patients that needed treatment outside the Strip, and since the Popular Committee Against the Siege started its activities towards the end of October, it has registered 105 cases of deaths due to the siege itself.
Construction and Infrastructure Sector
Since Israel's announcement of the stoppage of the application of its Customs Code for the Gaza Strip, and banning the import of raw materials including iron and cement, the sector has suffered almost complete paralysis, (the stopping of 13 tile factories, 30 cement factories, 145 marble factories and 250 brick factories), thus 3,500 people lost their jobs.
Besides this, all development projects have been stopped, the value of which is estimated at 350 million US$, as the United Nations development stopped all its construction contracts for the infrastructure in the Strip, such as rehabilitation of street, water and sewage facilities, with an estimated cost of 60 million US$, and the UNRWA stopped its program for creating job opportunities at an estimated cost of 93 million US$ from which more than 16,000 people were supposed to benefit.
v. Freedom of Movement and Crossings:
The Gaza Strip is connected with the outside world through six entry points, five of which are connected with the Occupation. They are: Karm Abu Salem, Sowfa, Al-Mintar and Beit Hanoun (Eretz) crossings. As for the Rafah crossing, it is connected with The Arab Republic of Egypt. Israel controls its side of the five crossings, in which complete paralysis is practiced. Israel doesn't permit the transport of people from and toward the Strip except for extremely rare cases. It is allowed only through the Eretz crossing and only for employees of foreign establishments as well as in some acute health cases. Yet, most of these cases' applications for crossing are refused.
As for people's food product requirements and other supplies, estimates point out that the Strip requires imports from the outside world and from the West Bank. About 300 truckloads per day of raw material and other goods comprise the daily requirements.
Israel doesn't allow the transit except for basic human needs and basic food products. This has resulted in the lack of any stockpile of basic products, in addition to the absence of a large number of basic food products in the Palestinian market. Only 1,806 truckloads were permitted in October and 1812 in November, that is, an average of 60 per day, far below the basic survival requirements.
vi. Food Products
Since the start of its siege on the Gaza Strip, Israel has permitted the passing of food products on an intermittent basis, but upon considering the Strip an enemy region, the Occupiers limited the number of basic food products. They are allowed to be up to and not exceeding 11 items, certain food products that turned out to be in great shortage, and there is complete absence of a great number of others, thus resulting in an acute rise in prices in addition to other factors, that affected the every aspect of the lives of Gazans. As per the report of the central bureau of statistics, the increase in prices reached 5.79% in August, 3.15% in September, 1.03% October and 1.13% in November; meaning an increase since the beginning of the siege of 8%, compared to an increase in the West Bank of 0.10%.
Estimates for daily consumption of the following food products in the Gaza Strip are: 867 tons of flour, 153 tons of sugar, 110 tons of rice, 75 tons of different kinds of oil and 49 tons herbs and vegetables.