Before the current Israeli air strike on Gaza, the Palestinian territory was already plagued by economic woes. Anchor Marco Werman speaks with Sami Abdel-Shafi, a Palestinian-American businessman living in Gaza, who says much of Gaza's economy is dead.
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MARCO: Israel says its military operation in Gaza is aimed at stopping Hamas militants from launching rockets into Israel. One significant side effect is to bring most business in Gaza to a halt, not that there was much business there in the first place. Israel has all but sealed Gaza off from the outside world since June of 2007. That's when Hamas took control of the territory by force. Sami Abdel-Shafi is a Palestinian-American management consultant living in Gaza.
SAMI: The private sector closed down more than a year ago. The few companies which remained operating, those in the modest financial business if you will, those small factories which manufactured simple food products: biscuits, juice and so on, they have all closed down. And that has resulted in the layoff of about 80,000 workers just from the private sector. And when you combine that with the newly found policy of the State of Israel of preventing Palestinian laborers from working in Israel you end up with massive unemployment that's reaching up to 40, 50 percent levels.
MARCO: Remind us what led to those businesses starting to shut down over a year ago.
SAMI: Essentially it is a consequence of the policy that was imposed on the Gaza Strip making it a humanitarian case, meaning that only basic goods that are necessary for the sustainability of human requirements, very, very basic goods, those were the only types of goods admitted into the Gaza Strip. This meant that the raw materials that carpenters need, that manufacturers need, for the simple things they use to produce and manufacture--clothing shops. All kinds of small businesses, they were all disabled and they were forced to close down simply because there is no more raw material that they could produce. But then the second challenge, or the one before it actually that came to reality, was even if they produced they were unable to export what they produce. Take the example of the agricultural area also. We have had the season of strawberries and carnations, which used to be exported to many countries in Europe. They were transferred to be animal feed, because they could not be exported.
MARCO: Are there any types of businesses functioning in the Gaza Strip?
SAMI: You can comfortably say there are none with the exception of small and modest retail
stores. Those which sell milk and food products, bakeries, things like that, and a few restaurants and cafes here and there. That's all.
MARCO: Are there any banks?
SAMI: There are banks. There are Palestinian and Arab banks in the Gaza Strip, but these banks have been virtually disabled because of a shortage in cash. When you lose your ability to dispense cash to pay for salaries and so on, then a major--a major part of the banking cycle or the transaction between banks and people is completely disabled. So, there is a great threat that the banking sector in Gaza will be demolished.
MARCO: It sounds like a really dire situation. I mean, as somebody who formulates plans for economic recovery can you imagine a plan for economic recovery after this current deficit?
SAMI: There is no plan that will ever succeed in the Gaza Strip with the current restrictions imposed on it, making it impossible for people and goods to move in and out of the Gaza Strip. No economic plan would be enabled without this very basic, fundamental prerequisite of freedom of movement of goods, people, and funds for that matter.
MARCO: What additional impact have the bombings caused on the economy of Gaza?
SAMI: They have not caused a direct impact on the economy of Gaza, because the economy is already dead. But the effect it has caused is to introduce people to a new sense, a constant sense of mortal fear. These feelings when tripled and quadrupled in peoples' minds and souls, they end up killing their true hope and a peaceful future, and that is very dangerous.
MARCO: You said that the economy right now in Gaza is dead. I'm curious to know what you're actually doing to help the situation, how you're passing your time?
SAMI: Uh, I am very busy trying to formulate projects and proposals and studies to make obvious the effect of politics on economics; the effect of the economy and the health of the economy or lack thereof on peoples' inclinations and sentiments. What we are finding so far is that people have got to be given economic opportunity. They have got to be given an opportunity to work, to receive proper education and proper healthcare. And in the absence of all of this, people will be forced into a sense of desperation and loss of hope.
MARCO: Sami Abdel-Shafi is a Palestinian-American management consultant and a businessman in Gaza. Thank you very much.
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