Michael Horesh

What is the cost-benefit of building a tunnel?

An outsider looking in on the Middle East must be wondering why Israel and Hamas are fighting a war over a series of tunnels. After all, if Gaza is so poor, as its supporters maintain, how could they afford to build such a network?

It is an open secret that for at least a decade how the tunnel economy has funded Hamas, even before it came to power. Before Egypt shut down the Sinai side of the operations last year and sealed up its side of the border, it is estimated that via taxes and sales the trade was valued in billions for the Hamas exchequer.

So how much does it cost to build a tunnel?

I have already cited Doron Peskin last week. Yesterday, writing in Hebrew, he estimated that one meter costs about US$200, and tunneling work can achieve about 20 meters per day. The cement used to be smuggled through from Egypt. More recently, it has come in ‘regular’ lorry-loads via Israel. Since 2011, Qatar has replaced Iran as the prime paymaster.

Israeli reserve Col.Miri Eisen – former deputy head of IDF’s combat intelligence corps and former assistant to the director of Military intelligence, commented in an interview: –

It is a lucrative economic job in the Hamas. It is their top-tier unit, which is called the tunneling unit. They have put an enormous amount of money when they saw that the tunneling itself was something which Israel has intelligence challenges in finding the tunnels themselves while they’re building them. They put an immense amount of money and effort. They put the best into the tunneling units. They’ve built tunnels from the Gaza Strip into Israel that are a mile, a mile and a half, a mile and 800…I mean incredibly long tunnels and we’re not talking about a little mole tunnel which is dug and a person goes through like in [Shawshank] Redemption… We are talking about tunnels that are done in the tunneling mode, the way you would build nowadays trains, roads, anything that goes underground into a mountain. They are tunneling out, they are using their money, their capabilities, with little Caterpillar tractors that go in and dig out the dirt, covering it with an enormous amount of cement, and you’re all aware of the issue of cement going into the Gaza Strip.

However, in economics, for every cost, there is an alternative cost. In other words, if you can spend on X, that means you did not invest in Y. And therefore, those needed the benefits of Y lose out.

I have no idea how many tunnels exist in Gaza or how long they are. The IDF claims that it has already found 13. So, let’s assume conservatively there are only 20 in total and each one is 2 kilometers long. By my wobbly maths, that is close to a US$100m investment. The alternatives?

Point 1: 13 tunnels may have been found so far. There is no record of a one public bomb shelter being discovered in Gaza. In contrast, history has forced Israel to build one in every one of its homes in order to protect its citizens.

Point 2: BBC journalists and others decry the lack of medical services in Gaza. Now this is compounded by Hamas fighters using ambulances for transport. On the other hand, how is it possible that Israel has managed to establish a field hospital for Gazan citizens during the battles (as it has done for Syrians), while Hamas officialdom is nowhere in sight?

Point 3: Hamas relies on UNRWA to provide a schooling system. And yet the facilities are abused to store weapons. (I understand that UNRWA has since returned the equipment to the government)

The war could have been avoided. As Egypt’s foreign minister said last week: “Had Hamas accepted the Egyptian (ceasefire) proposal, it could have saved the lives of at least 40 Palestinians.”

The pathetic reality is that while Hamas leaders are safely closeted in the tunnels that they have erected for their own means, far more than 40 lives have been lost. The true cost of the Gaza tunnel network, for both sides of the diplomatic divide, has to be measured in terms of emotional loss, a horribly unnecessary evil.

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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