Gaza economy: Money flowing but to whom

By the time that Hamas and Israel had become locked in hostilities this summer, the boom had long gone out of Gaza’s economy. After two strong years, 2013 saw a 1.5% reduction in growth.

The basic facts are depressing:

  • Egypt has sealed its border shut, with not a hint of the tons of humanitarian aid that comes in via Israel every week.
  • Cleaning workers in hospitals are on strike, indicative of labour problems in the dominant public sector.
  • Thousands of people are trying to flee to abroad, a dangerous process which starts with an investment of around US$2,000.

From what is known, civil servants in Gaza have not been paid for three months. Danny Rubinstein, a leading Israeli commentator, claims that the money has arrived in the account of Abu Mazen from his Qatari sponsors. However, the Palestinian president has only paid for those workers in Ramallah, from where he rules.

It does beg the question as to what has happened to the rest of the cash?

A second issue of concern is what will happen at the donors’ conference, which is due to meet in Cairo next week. In order to rehouse hundreds of thousands and to create new commercial projects, billions of dollars are sought. Assumedly, much verbal emphasis will be invested in blaming Israel for border restrictions.  I believe that the average Palestinian deserves an answer to a more important question: Who is going to ensure that these vast quantities of financial largesse will be monitored transparently, so that the bottom line is a better Gaza?

  1. Hamas cannot be trusted. Last week, it even resorted to robbing The Bank of Palestine in order to finance immediate needs.
  2. UNRWA’s neutrality has also been severely compromised. The recent war showed that Hamas has abused UNRWA schooling facilities, where the teaching unions have become politicised and the buildings were used for launching Kassam rockets against Israeli civilians.

It is appropriate to recall here that back in December 2013, the European Court of Auditors admitted that it cannot vouch for where all the billions of Euro dollars in aid have disappeared to over the years.

In a month when the world is waking up to ISIS, Russia is squeezing out Ukrainian liberty and China is poised to crush thousands of students in Hong Kong, who cares? So what if a few billions goes missing in yet another impoverished part of the Middle East. After all, last month 500 Palestinians were drowned and the world’s media barely let forth a polite cough.

Hamas officials have been noticeably quiet about this horrific tragedy. Meanwhile, they must have made a relative fortune from this new-found export in human traffic. And that is the point. Huge sums continue to flow around for a select elite in Gaza, but it is not the truth that is swept up in the wash.

About the Author
Michael Horesh is a recognised business coach and mentor, and has helped clients collectively to create millions in added value over the past decade. He has substantial understanding of the workings of the Israeli economy and the financial situation of the Palestinians, as well as an incisive way of looking at Middle East issues.
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