Deleting Gaza's Economy from
Gisha - Legal Center for Freedom of Movement
Gisha is an Israeli non-profit organization founded in 2005, whose
goal is to protect the freedom of movement of Palestinians,
especially Gaza residents. Gisha promotes rights guaranteed by
international and Israeli law. (www.gisha.org)
1. Policy of Commercial Paralysis
In the aftermath of the Hamas takeover of Gaza, Israel closed the
crossings into and out of the Gaza Strip,1 and the economic boycott
became complete. The Israeli Customs Authority instructed agents
not to transfer commercial goods to Gaza, with the exception of a
limited amount of products, defined as being for humanitarian use
In order to prevent an immediate humanitarian crisis, fuel,
essential supplies and medicines are transferred in small
quantities, mostly through the Kerem Shalom and Sufa crossings
(which are significantly limited in terms of capacity).
In the period June 14-July 12, 2007, 65,000 jobs have been lost in
Gaza's private sector due to the closures, according to Bassam
Khoury, chairman of the Palestine Federation of Industries. If the
situation continues, 55,000 more Palestinians will become
Data compiled by Gisha show that Gaza's industries are collapsing.
Of the 3,900 factories in Gaza producing food, pharmaceuticals,
construction materials, wood, paper, craftwork, engineering
materials, metals, plastics and rubber, more than 2,900 - 75% of
Gaza's factories - have ceased to produce.3 The rest of the
factories are operating on a limited basis, on borrowed time, until
the stocks of raw materials are exhausted.
Approximately 30,000 factory workers stand to lose their jobs.
Factory employees constitute 10% of those working in Gaza, and on
average, each worker supports a family of seven. In Gaza,
unemployment stands at 35%. According to the World Food Program,
85% of Gaza residents are already dependent on food aid - and the
number is growing.
Israel erased from its computers the customs code used to identify
goods entering Gaza and issued orders not to allow any imports into
Gaza, with the exception of humanitarian goods, such as donations
of food, medicine and medical equipment. According to a letter from
Reuven Meltzer, deputy head of the Israeli Customs Administration,
"[c]argo intended for the Gaza Strip will not be released until
further notification. Requests to clear goods intended for Gaza
will be blocked by the computer system."4 The implications: Gaza is
closed to the importation of goods.5
Israel's working assumption is that choking Gaza's economy and
closing its borders to the passage of people will achieve its
political objectives. According to this theory, these political
objectives are to be achieved by exerting pressure on 1.4 million
women, men and children, whose suffering is to bring about the
desired change - toppling Hamas' control in Gaza. In fact, a policy
of collective punishment is being imposed upon 1.4 million people,
in violation of international humanitarian law and, in effect, in
clear contradiction of Israel's interests.
This policy is destroying the business sector and creating a new
welfare regime in Gaza, turning growing numbers of residents into
dependents on international welfare agencies and religious
charities. As of July 2007, 87% of Gaza residents lived below the
poverty line.6 The opportunity to earn a living with dignity and to
build a properly functioning society is disappearing. According to
the chairman of Israel's Association of Industrialists, Shraga
Brosh, "the economic boycott on the Gaza Strip… will result
in a humanitarian disaster, fueling flames and leading to
deterioration of the security situation - a situation that will be
destructive to the Israeli economy."
2. Ban on Passage of Goods
Israel completely controls the importation of goods into Gaza and
exercises significant control over the exit of goods from Gaza
abroad and to the West Bank.7 Israel does not allow the transfer of
goods to or from Gaza via the sea, the air or the Rafah crossing
between Gaza and Egypt.8 The only option for Gaza residents is to
transfer goods through the crossings with Israel, primarily via the
On June 12, 2007, Israel closed the Karni crossing - Gaza's primary
artery of commerce. Israel has since permitted the importation of
humanitarian goods through the Kerem Shalom, Sofa and Erez
crossings, but their capacities are very limited. Humanitarian aid
organizations warn of shortages of basic humanitarian supplies,
because the daily amount of essential supplies entering the Gaza
Strip is less than Gaza's daily needs.9
As noted, once the borders were closed and the order was given not
to clear goods intended for Gaza, it became impossible to transfer
goods that are not strictly humanitarian: food, medicine and
medical equipment. In the first two weeks of the closure alone,
Palestinian importers accrued $1.5 million in debt for fines paid
for the use of rented containers that were stuck, and each day the
charges increase.10 Significant losses are also incurred from the
breach of supply contracts and the paralysis of Gaza's industries.
Additional losses are being incurred from damage to goods stored in
warehouses for extended periods.
"The Gaza Strip has been economically removed from the map and from
Israel's agenda. If they erase the customs code for Gaza, what is
left?" Majdi Khalil, general director of the Palestinian Shippers'
Gaza's factories are collapsing. Producers have long suffered from
difficulties in importing raw materials and exporting finished
products, as well as unreliable electricity supplies, due to the
destruction of Gaza's power station by the Israeli Air Force in
June 2006. Most of the factories that exported goods shut down even
before the current closure, because the frequent closures of the
Karni crossing in the past disrupted business. However, now, even
factories producing goods for local consumption are finding it very
difficult to operate.
Agricultural export, too, which had survived in Gaza prior to the
border closure, has been paralyzed. As of June 12, 2007, farmers
cannot sell their vegetables, flowers and other produce to Israel,
the West Bank and other countries. These farmers are losing the
livelihood that was to support them and their families.
3. Legal Framework: Collective Punishment
Under international law, as the occupying power in Gaza and the
West Bank, Israel is obligated to provide for the needs of the
civilian population in Gaza, to guarantee their rights, and to
facilitate the functioning of normal life in Gaza, to the extent
that the matter is under its control.11 Israel's obligations are
especially strong because of its control over Gaza's air space,
territorial waters, and land borders with the outside world,
including significant control over the border between Egypt and
Gaza. Such control renders civilians in Gaza subject to decisions
made by Israel.
Denying Gaza residents the ability to live in dignity, to lead
normal lives, to work and support themselves and their families
violates Israel's obligations under international humanitarian and
human rights law and Israeli law. Israel is required to permit the
passage of food, clothing, medicine and medical equipment, and to
facilitate civilian life in Gaza through all means at its
Israel is also obligated, to the extent possible, to permit
civilians in Gaza to lead normal lives.13 Normal life is not just
food and water, but rather dignified human existence, the
possibility of continuing to earn a livelihood, including
permitting factories in Gaza to operate and to supply incomes to
their workers and dependents. Indeed, Israel must also protect the
rights of Gaza residents to work, to strive to achieve an adequate
standard of living and to continuously improve their living
Instead, Israel has adopted a policy of collective punishment, in
violation of international humanitarian law, which explicitly
provides that no person shall be punished for a deed that he did
In response to an appeal from Gisha asking that Gaza's borders be
opened, Israel's Defense Ministry replied as follows: "Regarding
Karni crossing, we repeat and emphasize that the crossing was
closed beginning June 12, 2007 in light of an announcement by the
Palestinian side, that because of the internal conflicts in the
Strip, they were not capable of operating it, in addition to their
inability to defend against terrorist activities at the crossing
and to prevent the destruction of goods entering the Strip, as a
result of the lack of a party responsible for managing the crossing
on the Palestinian side."16
Gisha recognizes that the changes in internal power within Gaza may
necessitate changes in the coordination mechanism for opening the
crossings, which thus far had been operated, on the Palestinian
side, by security forces answerable to Palestinian President
Mahmoud Abbas (Abu Mazen). The partial opening of the crossings for
passage of humanitarian aid shows that, even after the takeover of
key positions in Gaza by Hamas, it is possible to open Gaza's
crossings and to permit Gaza residents the passage of goods
necessary to live in dignity. Responsibility for finding a new
method of coordination, if necessary, rests with Israel, as the
power exercising control over the passage of goods via air, sea and
land. Responsibility for facilitating and assisting in that
coordination lies with Palestinian leaders in Gaza and the West
Bank, if necessary with the assistance of international
Recommendations for Immediate Implementation:
* To open the Karni crossing, the commercial crossing between
Israel and Gaza, and to work with Palestinian and/or international
actors - irrespective of political beliefs - who have the
capability to coordinate opening the crossing from the Gaza
* To renew customs clearance for commercial goods intended for
* To permit Gaza residents to export goods via the crossings;
* To open the borders of Gaza to passage of persons.
For leaders of the Palestinian Authority in Gaza and the West
* To act immediately to coordinate the opening of Gaza's commercial
crossings, through a commitment to meeting the needs of Gaza
residents - irrespective of political beliefs.
For Egypt and the international community:
* To offer immediate assistance to efforts to reopen Gaza's borders
to import and export.
1 The Rafah crossing, between Gaza and Egypt, was closed beginning
June 10, 2007. The Karni crossing between Israel and Gaza, Gaza's
lifeline through which commercial goods are transferred, has been
closed as of June 12, 2007, except for limited shipments of wheat
sent on conveyor belts that do not require opening the crossing for
truck access. The Erez crossing, the crossing for travelers between
Gaza and Israel, was closed on June 14, 2007 and since then has
opened on a very limited basis.
2 See letter from Reuven Meltzer, Deputy Director of the Customs
Authority, Israeli Shippers, dated June 20, 2007 (on file with the
3 According to a July 12 statement by the Palestinian Federation of
Industries, approximately 80% of Gaza's factories have temporarily
ceased production, and those still operating are operating at
approximately 60% capacity.
4 Letter from Reuven Meltzer, deputy head of the Israeli Customs
Administration, to Mr. Pintor, director of the Umbrella
Organization of Customs Agencies and the International Shippers
from June 17, 2007 (on file with the authors).
5 In principle, cessation of customs clearance would not prevent
Gaza residents from receiving goods that are exempt from customs
(tax-exempt donations and goods from Israel or the West Bank, which
are within the Israeli-Palestinian "customs envelope") or goods
that cleared customs prior to June 17, 2007 but have yet to be
delivered. However, the military has limited shipments into Gaza to
foodstuffs, medicine, and other essential supplies, even where
customs clearance has already taken place. Partial lists of the
goods permitted to enter Gaza can be found on the Israeli military
spokesperson's web site, www.idf.gov.il (see e.g., IDF
spokesperson's announcement, July 1, 2007).
6 See "Situation Report", United Nations Office for the
Coordination of Humanitarian Affairs, June 20, 2007, available at
7 For details on Israeli control over Gaza borders, see Gisha's
position paper: Disengaged Occupiers: The Legal Status of Gaza,
January 2007, pp. 32-49, available at www.gisha.org.
8 According to the agreement that allows for the opening of Rafah
crossing, in principle, goods can be exported via Rafah crossing.
However, since June 2006, Israel has not allowed for the regular
opening of Rafah crossing, and it has not been possible to develop
a direct channel for exports between Gaza and Egypt. The same
agreement prohibits importing goods via Rafah. Israel allows for
the entrance of goods via Kerem Shalom crossing, which is located
in Israel, next to the triangular border between Gaza, Egypt and
Israel. See Disengagement Danger, aforementioned footnote.
9 See, for example, a report on the humanitarian situation in Gaza,
June 20-27, 2007, the UN Office for the Coordination of
Humanitarian Affairs, June 28, 2007, available at
10 According to Mr. Majdi Khalil, General Director of the
Palestinian Shippers Association.
11 On the control Israel exercises in Gaza and the legal
obligations that it creates, see Gisha's position paper, Disengaged
Occupiers, supra note 8.
12 Geneva Convention Relative to the Protection of Civilian Persons
in Time of War, 1949, Articles 23, 55 and 59.
13 Hague Convention Respecting the Laws and Customs of War on Land,
1907, Article 43.
14 International Covenant on Economic, Social and Cultural Rights,
1966, Articles 6 and 11.
15 Hague Regulations, supra note 15, Article 50, and Fourth Geneva
Convention, supra note 14, Article 33.
16 Letter from Koby Gerzwolf, Assistant to the Coordinator of
Government Activities in the Territories, to Adv. Noam Peleg of
Gisha, June 27, 2007 (on file with authors).
Over 75% of Gaza's factories have halted production. (Photo by