The GDP in the Gaza Strip rose by 15% in 2010 and unemployment dropped.

 Implementation of policy towards the Gaza Strip – update June 2011


Photo: Reuters, Feb. 2011

Following is a status report on the implementation of civilian policy for the Gaza Strip. The policy relies on two Cabinet decisions – from June 20, 2010, and Dec. 8, 2010.

Most of the data comes from COGAT (Coordinator of Government Activities in the Territories) and the Land Crossings Authority.

1. Land crossing activity

In recent months the Karni crossing, where the conveyor for aggregates and loose seeds had been operating two days each week, has been closed. Karni was closed because of security constraints and its activity was transferred to the Kerem Shalom crossing, which is open six days a week.

The Kerem Shalom expansion plan is budgeted at over NIS 100 million. To date, more than NIS 50 million have been invested and the crossing’s capacity has increased by 233%. Following the Cabinet’s December resolution, the increase of agricultural exports abroad was approved and at the peak of the season agricultural exports from Gaza to Europe came to 40 truckloads per week.

On the Palestinian side – Three additional unloading areas totaling approximately 10 acres were built, with the ability to accommodate 30-35 grain transport trucks each day. Perimeter lighting was also installed so that work can continue after dark.

On the Israeli side – The truck reception area was enlarged, the access road to the crossing was widened, and two areas for transferring goods were completed, enabling capacity to be increased from 90 trucks a day to over 300 trucks. A grain transfer facility was also built, as well as a temporary site for aggregates, and an access road was paved to provide separate access for import trucks.
The volume of goods entering the Gaza Strip each day increased by a whopping 87%. Their variety also grew, which bolstered the private sector and led to a 74% increase in the volume of goods purchased by the private sector, compared to the same period last year.

In fact, Kerem Shalom’s capacity for receiving goods is greater than the quantity actually being transferred!!!

2. Internationally-sponsored Projects

Israel is working in cooperation with the international community and the Palestinian Authority to authorize and advance projects that are internationally financed, implemented and supervised. To date, 150 projects have been approved in the Gaza Strip; 26 of them have been completed and 52 are in progress.

The week of 21 June 2011, the Minister of Defense briefed the UN Secretary-General on the approval of 20 additional UNRWA projects, joining the 130 that were approved in the past. Authorization has been obtained to construct 18 new schools, and two (UNRWA) residential projects – one in Khan Yunis and the other in Rafiah/Tel Sultan – containing 1,191 housing units. One project is being sponsored by Japan and the other by Saudi Arabia.

Distribution of the 150 approved projects according to category:

• 58 in education: includes constructing 42 new schools, expanding three new schools, restoring 49 kindergartens, and restoring eight libraries and community centers.

Out of 24 UNRWA requests for building new schools (not including 18 that were approved this week), construction has commenced on only nine schools.

• 28 in water and sewage: establishing three sewage treatment plants, upgrading two plants, six sewer systems, a desalination facility, eight bridges and water systems, creating two water reservoirs and restoring three pumping stations.

• 12 in housing: 800 residential units and 1,191 additional units.

• 14 in agriculture: setting up 400 greenhouses and 1,600 plots for crops; building100 refrigeration and packing rooms; restoring agricultural lands and wells.

• 15 in health: building four new clinics, establishing a cardiology department in a hospital, restoring five hospitals and clinics, building and restoring four medical association facilities.

• 11 in infrastructure: two electrical; restoring 21 agricultural access roads; developing a bathing beach; repairing four roads.

• 12 miscellaneous: restoring and expanding the UNRWA headquarters, creating jobs for 850 women, establishing a municipal produce market, building a cultural center.

Containers of equipment for UNRWA summer camps were also brought in.

Distribution of the projects according to countries and organizations:
UNRWA 70, UNDP 24, USAID 44, World Bank 3, Red Cross 2, Germany 1, AFD (France) 1, Belgium 1, Egypt 1, Holland 1, NGO Medico 1.

UNRWA projects:
The organization has so far submitted requests for 70 projects, of which only ten have been completed and only 23 are in stages of implementation.

To the best of our knowledge, the organization is having trouble raising funding for some of the projects that have already been approved by Israel.

3. Entry of aggregates (construction materials) to the Gaza Strip

In March 2011 Israel made a special effort to bring aggregates from the Sufah area into Gaza, even though 250 rockets and mortars were fired at Israel during that same period. Seventy thousand tons of aggregates purchased by the various international organizations were brought in so the approved projects could be carried out.

Last year 159,627 tons of building materials were brought in for projects funded by the international community. Since the beginning of 2011, the international community has brought in 234.7 trucks per week on the average (8,270 tons). Every month 1,019 trucks enter (36,389 tons).

At this stage, bringing building materials in for the private sector is not allowed, but this subject is under consideration.

4. Agricultural exports from Gaza to Europe

This year as well, the joint project with Holland for exporting strawberries and carnations continued and was even expanded. It was also decided to export peppers but that ended due to a failure to meet European standards. Cherry tomatoes were approved as an alternative.

Exports to date:
9,767,678 carnations
51 tons of strawberries
3 tons of peppers
3 tons of cherry tomatoes

As aforesaid, at the peak of the season, the volume of agricultural exports from Gaza to Europe came to 40 trucks per week.

5. Following a Cabinet decision in June 2010, joint COGAT-PA teams were set up to coordinate expansion of the civilian policy.

6. Civilian traffic for humanitarian and business purposes

The humanitarian policy continues, despite the firing of missiles and mortar bombs at communities in Israel. In 2010, 30,090 Palestinians departed from Gaza. Fifty-four percent of the permits were issued for medical treatments; some 16,430 patients and the people accompanying them left the Gaza Strip to receive medical treatment in Israel territory and Judea and Samaria.

The quota of businesspeople entering Israel also increased to 70 per day. Over 300 people exited Gaza each week.
Throughout the period, 7,282, businesspeople left for Israel, Judea and Samaria, and overseas, as part of the ongoing economic activity in the Gaza Strip.

7. Economic indicators in the Gaza Strip

As is clearly evident from data provided by the IMF, the World Bank and the Palestinian CBS, Israel’s civilian policy has contributed to strengthening the economy in the Gaza Strip and improving the local population’s lives.

The following statistics bear out this claim:
The GDP in the Gaza Strip rose 15% in 2010.
In the first quarter of 2011:
The output in the Gaza Strip grew by 24.2%.
The output per capita rose 20%.

The rate of unemployment in the Gaza Strip in 2010 dropped from 41% to 38% according to the Monetary Fund and from 39.3% to 37.4% (with an unemployment rate of 52.8% among those aged 15-29) according to data from the World Bank.

The Palestinian Central Bureau of Statistics reports that in the first quarter of 2011, the unemployment rate in the Gaza Strip dropped to 30.8%, compared with 33.9% in the first quarter of 2010.
The unemployment rate among refugees dropped from 36.2% to 30.6%.

The percentage of construction workers rose from 4% to 5%. Activity in the construction sector accounted for 13.3% of the total economic activity in the Gaza Strip, as compared with 3.5% in the first quarter of 2010 (data courtesy of the Centre for Policy Research’s Department for Economic Affairs).