Despite the economic growth in Gaza, many destroyed homes still haven't been rebuilt. Photo: RafahKid (flickr)

Despite the continued blockade on goods in Gaza, the area is experiencing its first period of economic growth since 2007, largely due to Egyptian policy changes.

New luxury hotels, a shopping mall, and dozens of schools are all signs of increased economic development and decreased dependence on Israeli goods since the blockade began four years ago, the New York Times reported in June. Jobs have been increasing and over 1,000 factories are up and running, according to Hamas. While the growth has put unemployment back below 25 percent and allowed the rebuilding of hundreds of homes, Gaza still struggles.

Electricity is inconsistent, leaving hospitals and schools vulnerable. In the last four years, the number of people living on less than $1.60 a day has tripled. Reliance on food aid remains extremely high and thousands of homes are not yet rebuilt. “For the vast majority in Gaza, things are not improving,” a Gazan medical student told the New York Times. “Most people in Gaza remain forgotten.”

Increased trade from Egypt has led to real improvements, but the blockade still inhibits development of meaningful infrastructure that improves lives long term.

Tunnel workers prepare to lower someone into the tunnels. Photo: Zoriah (flickr)

The tunnels in Gaza were an invention of necessity. They flourished during a three-year blockade of goods from Israel into Palestine. Trade had to come from somewhere. And it did — these underground tunnels were used to import everything from food to building supplies to weaponry from Egypt into Palestine. At its height, the several hundred tunnels provided jobs to thousands of Palestinians. According to the Christian Science Monitor and the Associated Press however, roughly a few dozen tunnels are up and running after Israel eased the blockade in June, and smugglers are taking home only a fraction of what they used to — if they managed to hold onto their jobs at all.

While the ease of the blockade is seen globally as an improvement for the conditions of the Palestinian people, Gazan smugglers find themselves lamenting the days when trade was booming and people had work. "This is my first work day in the past two weeks," Khalil Saleh, 19, told the Associated Press.

In effort to keep business alive in Gaza, some smugglers are working on exporting food and goods now allowed from Israel into Egypt, according to the Christian Science Monitor. The most commonly smuggled exports are scrap metal, as well as Israeli food, which costs more in Egypt where inflation and rising food costs continue to be a problem. But smugglers are still not making what they used to, and the job remains a risky one.

Saber Salem told the Associated Press about the challenges he faces as a tunnel operator:

Life is very difficult and our work faces many risks and obstacles.... Hamas inspects our shipments and tunnels because they fear drug trafficking. The Egyptian security has set up many roadblocks on side roads.

Salem has seen his own business decline drastically. During the blockade, he ran three tunnels and had upwards of 40 employees working for him. Now he runs only one tunnel, and has just 15 employees.

The ease of the blockade, while quieting some of the recent criticism facing Israel, provides little long-term economic relief in Gaza and the West Bank. As long as Israel holds tight to bans on industry-creating goods like building, textile, and agricultural supplies, Gaza and the West Bank will remain economically dependent on the failing tunnels and Palestinians won't see any real relief.

Israel's ban on the import of building materials means that very little reconstruction has taken place since the 22-day Israeli offensive at the beginning of the year. Photo: Linda Mason for Mercy Corps

For the past several years, Gaza has suffered from a humanitarian crisis that waxes and wanes in severity, but never entirely disappears. This tiny patch of land on the Mediterranean Sea has one of the highest population densities in the world with over 4,000 people per square kilometer. On top of that, it suffers from a crushing poverty rate and high unemployment numbers that mean that 85 percent of the population is dependent on humanitarian aid.

The humanitarian situation is the result of an Israeli-imposed blockade that severely limits the flow of goods and people in and out. It's a part of what Palestinians see as a collective punishment for the actions of the Hamas-led government that took control there in June 2007. Hamas has also held an Israeli soldier, Gilad Shalit, in captivity since June 2006.

Gaza's crisis intensified at the end of last December when Israel launched Operation Cast Lead, a 22-day military offensive whose stated aim was to destroy Hamas's ability to launch rockets into southern Israel, and which resulted in the deaths of 13 Israelis and more than 1,300 Palestinians. A recent, controversial United Nations report assessing the war has accused both Hamas and Israel of war crimes.

Since the end of the offensive in January 2009, Israel has allowed some goods into Gaza — such as cooking oil and basic foodstuffs — but not lifted the blockade, so the crisis' underlying causes have not been alleviated. Mercy Corps' work in Gaza focuses on providing immediate humanitarian aid, helping alleviate unemployment through cash-for-work programs, and helping traumatized Gazans deal with their psychological scars.

Isdud al Najjar, Program Director for Mercy Corps in Gaza, recently spoke with me about the situation there.

Sarah Standish: Tell us about Mercy Corps' work in Gaza. What is your role?

Isdud al Najjar: Mercy Corps has worked in Gaza since September 2005. I was the first person hired there and I've been a program manager there since February 2006. We started with small scale emergency programs there in addition to the 'Why Not?' program [connecting youth in the U.S. and Gaza], and our programs have grown a lot since that time. We now have a huge Cash-for-Work program, where we provide short-term job opportunities for vulnerable male and female households as well as for new graduates.

We also have psychosocial programs focused on helping children deal with the trauma and stress they experience, as well as humanitarian and emergency assistance programs that respond to the harsh circumstances in which Palestinians are living.

Finally, we have new youth program called Global Citizen Corps, through which we're trying to promote the full participation of boys and girls in different aspects of life in order to create a shared vision of the future.

Sarah: The Israeli siege is the main cause of the humanitarian crisis in Gaza, but it's also caused a lot of subsidiary issues like environmental degradation, unemployment, a lack of higher education opportunities, failing businesses, scarce food supplies, and more. What do you think is the worst side-effect of the siege?

Isdud: The biggest problem the siege has caused is the rampant unemployment — about half the population is unemployed — which has had a huge impact on all aspects of life — sometimes in ways that will leave a mark on people long into the future. (The New York Times examined this issue in a recent article.)

Not only has unemployment lead to higher poverty rates, it's also associated with increases in domestic violence, which can have a negative psychological impact on children and their performance in school and at work. It's also related to a rise in school drop-out rates because some parents force their children to leave the education system in order to sell small items in the street. Additionally, we're seeing women and children out on the streets begging, which is a desperate last resort because it's considered so shameful — especially since Gaza is small and dense, and many people know each other. Some also try to marry their daughters off earlier in order to relieve themselves of that financial burden. When resources are scarce, parents always give priority to their male children, so in this kind of crisis it's women and children who pay the highest price.

Sarah: Can you tell us about the under-ground tunnels between Gaza and Egypt that are used to smuggle in goods prohibited under the Israeli blockade?

Isdud: There must be at least one thousand tunnels between Gaza and Rafah [in Egypt]. These tunnels have relieved the local market somewhat, and have definitely improved the economic situation of those who run them, but the prices of the goods smuggled through them are so high that they don't alleviate the average person's situation very much. The tunnels are a Hamas business. (Global Envision also wrote about the tunnels last winter.)

Sarah: Israel destroyed much of Gaza's infrastructure during the Dec-Jan offensive. Are rebuilding efforts under-way? Are homes being rebuilt?

Isdud: The offensive damaged or destroyed schools, water treatment facilities, public buildings, and houses, but very little has been restored because of the severe shortage of building materials. Israel doesn't allow any building materials into Gaza. There's a little bit of construction material coming through the tunnels, but it's so heavy that smugglers don't like to bring much through, and it's also too expensive for the majority of Palestinians to afford.

The lack of reconstruction means that many families are either living in buildings that are in poor condition, or staying with their relatives. As a result, there's even more overcrowding in existing buildings, and families have been split up — parents often have to send a few children to live with one set of relatives, a few others to live with another set.

Gazans follow the news closely, hoping to hear good news about their situation. In particular, they want to know what will happen with the kidnapped soldier, Gilad Shalit. People think that everything bad that happened to Gaza recently was revenge for the kidnapping, and they hope that if an agreement is reached on his release, the siege will be lifted.

Sarah: How has the blockade affected daily life and Mercy Corps' programs in Gaza?

Isdud: The siege has caused severe poverty and deprivation: 80 percent of Gazans now live under the poverty line, and 70 percent live in a state of deep poverty, which means that they're unable to cover the cost of their basic needs like food, health care, and electricity. Mercy Corps provides some food assistance and non-food items like water tanks, as well as medical supplies for people with disabilities. It's difficult to determine who should receive this aid since the number of people in severe need of this assistance has increased dramatically. For example, we receive thousands of applications for our cash-for-work program, but we can only help 6000-8000 people. The challenge for us is how to successfully target the poorest of the poor.

For a period, there were also severe electricity shortages [after Israel began cutting Gaza's power supply in retaliation for Hamas's rocket attacks in October 2007] that affected Mercy Corps' ability to run its programs smoothly. Sometimes, we experienced up to ten hours of power outages at a time. We have a cash-for-work program employing women who sew school uniforms, but they couldn't use their sewing machines without power, so jobs that should have been finished in twenty days sometimes took up to a month and a half. We also employed women to bake pastries that were provided as snacks to pre-schoolers, but the same thing happened: They were unable to run their electric ovens when the electricity was cut off, just as our psychosocial programs were negatively affected when there wasn't enough light in the rooms we were using to see by. Even worse, the electricity outages also meant that buildings would run out of clean water. Luckily, Mercy Corps has a generator at our office, but it didn't always have enough power to compensate for the cuts.

There was also a period in Gaza in which there was hardly any fuel. Taxis were idle, and their drivers sat at home. People were cooking over wood fires for lack of gas. Luckily, fuel is now usually able to pass into Gaza normally, so the energy situation has improved a little.

However, the siege has also caused a severe materials scarcity that hasn't abated, so we've had to be creative and re-plan some Mercy Corps programs according to what's available to us. We had planned to help reconstruct the offices of some local NGOs and rebuild a public park, but this turned out to be impossible because of the lack of building materials. Instead, we had to focus on programs that rely more on the availability of labor than materials. For instance, we employ people to help fishermen maintain their nets, and we've started a cash-for-work program that pays unemployed laborers to work on farms; that way, the program provides some people with employment, as well as helping the farmer by providing him with free labor that keeps the farmer from pulling his children out of school to do this work.

Sarah: Tell us more about Mercy Corps' psycho-social programs.

Isdud: Our programs are designed to help children who've been negatively affected by the stress of daily life and the traumatic experiences they've undergone. The program targets moderately traumatized children along with their parents and teachers, and we deliver psycho-social guided sessions using different techniques based on professional manuals, like the CABAC [Children Affected by Armed Conflict] manual, designed to help children living in conflict zones. We try to take a comprehensive approach by giving different workshops to the teachers and parents of the kids, mainly on how to deal with depressed and traumatized children, and we tell them about the importance of providing down time for their children and encouraging them to play. The program also offers some remedial classes for children whose school performance has been affected by their psychological problems. This program has been a great help to many of the Gazan children who are suffering from this overwhelming situation.

An Israeli checkpoint in Nablus, West Bank. Photo: David Ortmann (flickr)

Since Israel relaxed West Bank checkpoints in June, there's been a newfound sense of both security and economic freedom for the struggling Palestinian territory, according to the New York Times' Thomas Friedman.

Friedman says the economic improvement is largely a result of reformed police tactics and increased trade:

For Palestinians, long trapped between burgeoning Israeli settlements and an Israeli occupation army, subject to lawlessness in their own cities and the fecklessness of their own political leadership, life has clearly started to improve a bit, thanks to a new virtuous cycle: improved Palestinian policing that has led to more Palestinian investment and trade that has led to the Israeli Army dismantling more checkpoints in the West Bank that has led to more Palestinian travel and commerce.

Recent statistics for the West Bank support the claim that things are getting better. The International Monetary Fund is forecasting 7 percent growth, and construction is about to begin on the first new town in decades, according to a New York Times account.

Friedman is hopeful that economic improvements could lead to political gains:

Make no mistake: Palestinians still want the Israeli occupation to end, and their own state to emerge, tomorrow. That is not going to happen. But for the first time since [the collapse of the 2000 Oslo peace accords], there is an economic-security dynamic emerging on the ground in the West Bank that has the potential — the potential — to give the post-Yasir Arafat Palestinians another chance to build the sort of self-governing authority, army and economy that are prerequisites for securing their own independent state. A Palestinian peace partner for Israel may be taking shape again.

More Gazans depend on food aid, thanks to the blockade. Photo: Cassandra Nelson/Mercy Corps

The Christian Science Monitor reports that the Israeli naval blockade of the Gaza strip is crippling the Gazan fishing industry.

The total catch has dropped by half, because fisherman can't get to the fish. In 2001, Gazans could fish up to 20 nautical miles offshore. Today, thanks to new blockade restrictions, they are limited to three. Since most fish are found 6 to 12 nautical miles offshore, the blockade makes the fishing business chancy at best.

A declining fishing industry would be a problem for any country, but it is a particular problem for Gaza. Almost half of the population is unemployed. Thanks to the blockade, more than 70 percent of Gazans rely on food distributions from humanitarian agencies to ensure their families get enough to eat.

A Palestinian man looks out towards destroyed buildings following an Israeli air strike in Gaza City. Photo: Amir Farshad Ebrahimi (flickr)

A stated aim of Israel's military strikes in Gaza was to destroy underground tunnels between Egypt and Gaza because they're used by Hamas to smuggle in weapons.

But Gazans argue that there are two kinds of tunnels running from Gaza to Egypt: militant and civilian. Hamas-controlled tunnels are "supposedly steel-ribbed and large enough for a car to pass through," according to Time. And unlike civilians, who dig in plain sight of the Egyptian border security and Israeli surveillance aircraft, Hamas members are more secretive and obscure about the location of their tunnels.

Gaza's civilians claim their tunnels are necessary. Israel essentially sealed Gaza's borders to everything but humanitarian aid after Hamas took control of Gaza in June 2007, making the tunnels the only means for transporting everything from medicine, cement, chocolate bars, and even lion cubs for the zoo, according to Time.

"It's a lie to say that we use these tunnels to only bring in weapons. We're bringing in the ordinary stuff that keeps Gaza alive. If the Israelis opened the border crossings, we wouldn't have to be doing this," a Gazan resident tells Time.

According to the New York Times, the tunnels are also a primary source of income for some 25,000 young men. Tunnel diggers can earn $100 for every meter they dig — making the tunnels one of the biggest sources of employment in the territory. And they were back to digging as soon as the truce was signed.

"If Israel keeps the borders sealed off, we'll keep digging and only Allah can stop us. Let the Israelis drop their bombs. Without the tunnels we can't survive anyway," says Aymad, a tunnel digger. "And if a bomb catches me underground, well, they won't have to dig my grave."

The UN Food and Agriculture Organization (FAO) has developed a new tool to measure the state of a country's food system and its ability to withstand global shocks. Rather than just predicting food crises through its current early warning system, the new tool will help to measure a region's resilience — defined, in humanitarian terms, as "the ability of a system to withstand stresses and shocks in an uncertain world."

Luca Alinovi, a senior economist at FAO, explains that the logarithm for measuring resilience was developed in the Palestinian Territory, which serves as an example of a vulnerable, but ultimately resilient society. "The Palestinians have been living under incredible stress for a long time; everyone is vulnerable there," explained Alinovi. "Despite that, they continue to live and work in that situation — they are a particularly resilient community."

Data is collected according to five pillars: existing social safety nets, access to public services, assets, income and food access, households' capacity to adapt, and the stability of food supply. The goal is that this data will complement the FAO's early warning system — which focuses mainly on immediate upcoming crises — and allow for more effective long-term aid and planning. For example, stronger public services in a country that is highly susceptible to annual drought might mean less personal hardship if and when such droughts occur.

While critics may dismiss the new tool as no more than semantic brouhaha, there are real signs that the notion of resilience suggests a genuine paradigm shift. Mafa Chipeta, a FAO Representative in Ethiopia, recently spoke much less theoretically about resilience by underscoring the need for improving access to water, protecting natural resources, and addressing land tenure. "We need to think beyond responding at the consumption end and start putting resources on the production end," says Chipeta. "Scarce resources are better spent on increasing production than on subsidizing food. If you subsidize grain, next year you have to subsidize it again."

In other words, we need to put aid money into developing successful food systems, rather than waiting to spend money on one-time aid when a crisis hits. After all, without investments into a resilient agricultural sector, an eventual crisis is inevitable. Seen in this context, the FAO's new tool is representative of recent major shifts in food policy — reflecting growing consensus that in the long run, food aid fails to address genuine need. For millions of vulnerable people who have seen the pattern of crisis hit time and time again, this may be one critical step toward breaking that cycle for good.

Mercy Corps' Cassandra Nelson.

Despite Israel’s commitment to establishing a humanitarian corridor and daily three-hour ceasefire, delivering humanitarian supplies to the Gaza Strip has been a challenge. The Mercy Corps team on the ground reports that on the first day of the ceasefire, fewer than 40 trucks were allowed in — compared with nearly 500 trucks per day in spring 2007.

Yesterday a truckload of 7 tons food ($17,000 worth) for 2,000 people made it into Gaza. Mercy Corps staffer Cassandra Nelson shares her account of the transfer below.

Despite many obstacles and bureaucratic procedures presented by the Israeli authorities, Mercy Corps successfully delivered emergency relief food items to Gaza on Thursday.

The organization delivered a truckload of vegetable cooking oil, rice and canned tuna fish in sufficient quantities to feed 2,000 extremely vulnerable people for a week.

Mercy Corps spent the past 11 days working through Israeli red tape and protocols that seemed to change daily to secure the permission to deliver the truck today. The delivery was supposed to be made Wednesday, but at 2 a.m. the Mercy Corps team in Jerusalem received notice from the Israeli Defense Forces that the delivery was being postponed because it contained dates, which were not an essential food item. Today's delivery did not include dates.

The truck was repacked last night without the dates and with an extra three tons of rice. At dawn this morning, the truck and Mercy Corps monitors set out for the Kerem Shalom checkpoint.

The Mercy Corps vehicle joined a line of about 25 trucks waiting at the border. After about an hour long wait, the Israeli customs officials inspected the delivery and paperwork and allowed the truck to proceed into the unloading area for all shipments.

The vehicle was admitted to the unloading compound with several other aid trucks — all from various UN branches. The pallets were unloaded by forklift.

After all the items were removed from the truck and placed on the pavement of the compound, the security check began. Sniffing dogs were released to check the material. Next, a border control worker probed and stabbed every package with a long metal rod to check if anything might be hidden inside.

After the checks were completed, all the Israeli workers and other observers and monitors were told to exit back to the Israel side of the border. Once the compound was empty of all people, the gates on the Israeli side were slammed shut.

Next, the gates on the Gaza side of the compound were opened, allowing the Palestinians to enter the compound and collect the delivery with their trucks. No trucks were allowed to drive from the Israeli side to the Gaza side. Everything was offloaded from the trucks on the Israel side and then reloaded onto different trucks on the Gaza side.

Israeli guards said that at no point in the process are Israelis and Palestinians from the Gaza side allowed to meet each other.

The number deliveries are still far short of what is needed to serve a population that increasingly relies on outside aid to survive. On Wednesday, only 36 humanitarian-aid trucks were allowed to make their deliveries. Compare that to 2007, when an average of 500 trucks entered daily.

The Wall Street Journal reports on Mercy Corps' challenges in sending the delivery of food aid in this video.

Given the frequently gloomy headlines regarding the Israeli-Palestinian peace process, many may not be surprised to hear of the latest violence in the region. But NPR reports the current conflict is the heaviest fighting the Gaza Strip has seen since the 1967 Six Day War — and some of the hardest hit seem to be Palestinian civilians.

Following the start of an Israeli ground invasion, the latest reports from the Washington Post indicate that 550 Palestinians have been killed and 2,500 injured — and according to Palestinian health officials, between 24 and 30 percent of those are women and children. Currently the Israeli government has closed Gaza's borders to everything except a small trickle of humanitarian aid, insufficient to meet the needs on the ground.

Mercy Corps is calling for immediate humanitarian access to Gaza to deliver food and other essential supplies. You can sign the petition by clicking here. This petition urges the U.S. government to push for aid to be allowed in now.

You can also help get critical humanitarian items needed once the border is open by donating to Mercy Corps' Gaza Crisis Fund. Mercy Corps has a four-ton shipment of food that's scheduled to enter Gaza tomorrow, and they're deploying additional aid workers to Jerusalem and Egypt to prepare to do more. Check out how Gazan youth involved with Mercy Corps are handling the crisis and keep up-to-date on Mercy Corps' response to the crisis.

Life in Gaza Under Blockade Photo: Rafah, Gaza (flickr)

Fuel shortages, power cuts, aid shipments blocked by Israel — the UN now describes conditions faced by Gaza's 1.5 million people as "the worst ever." A recent BBC report tells how four Gazans are coping.

Musba Al-Shantri, a bakery owner, says the inconsistent electricity, water problems, gas shortages, and lack of available ingredients forced him to layoff five of his 12 employees and almost forced him to close. Musba admits to depending on material that comes from the smugglers' tunnels under Gaza's border with Egypt.

Fady Al-Burbar, who runs a shop selling meat and fish with his father, says, "A lot of our meat and fish has been spoiled because of the power cuts. Within two weeks I will have to close if the electricity problem continues like this — from now I will not bring more goods for my shop because I am not willing to buy things that will just perish."

Bakar Abu Al-Kas, a taxi driver in the Shujaiyeh neighborhood of Gaza City, also relies on the smugglers' tunnels for needed fuel. Afraid of running out of fuel from border closures, he is storing as much as he can afford before his access runs out.

"The closure of the borders affects economic life here," Bakar explained. "Daily life becomes really tough. The borders are the soul for the Gaza Strip."

The Israeli-Palestinian peace process is getting an economic jolt from none other than Dr. Bronner's Magic Soaps.

Dr. Bronner’s is an American company that has a 50-year tradition of environmentally and socially minded products. One of the company’s founding principles is that "constructive capitalism is where you share the profit with the workers and the Earth from which you made it!"

Following in that tradition, Dr. Bronner’s in 2005 started buying a majority of their olives from the Holy Land. Olive oil is the main ingredient in their magic soaps, and Dr. Bronner’s wanted to use its demand for olives to promote economic cooperation between the Israelis and the Palestinians.

Their magic soaps are now made with a mixture of Palestinian and Israeli olive oil. Dr. Bronner’s gets 90 percent of their supply from the Palestinian Canaan Fair Trade cooperative. The other 10 percent comes from the Israeli women’s fair trade association Sindyanna and the Strauss family farm in Israel.

"Blending olive oil from Palestine and Israel is a symbolic but significant contribution to promoting the concept of coexistence and cooperation in this area," Dr. Gero Leson, director of special operations for Dr. Bronner's, says in the video above.

Dr. Bronner’s initiative might be relatively small in the greater scheme of the Israeli-Palestinian conflict, but the project's ingenuity and potential has caught the attention of media such as American Public Media’s Marketplace.

While lots of companies have some sort of charitable arm or a mission that incorporates social responsibility, few are working in such a sensitive area and in such a deliberate manner to promote peace. Perhaps it's fitting for a company that has adopted this principle: "We are all brothers and sisters and we should take care of each other and spaceship earth!"