Prison camps can have quite sophisticated economies. Here’s a fascinating analysis of Hamas rule in MERIP, focusing especially on economic strategy in blockaded Gaza.
And despite -- if not because of -- the departure of Palestine’s traditional donors, Gaza’s government has introduced the measures they long advocated, heavily pruning the government wage bill, enforcing tax collection, and introducing a new system of license payments and levies on fuel and cigarettes entering the tunnels.
Over time, internal stability coupled with the new trade routes triggered an economic rebirth of sorts. The tunnels absorbed about a fifth of the 100,000 workers who had once labored in Israel, and brought in the raw materials and spare parts for factories crippled by Israeli bombardments to restart production. Gaza’s large flour mill is producing two thirds of its pre-siege average of 6,000 tons per day. A plastics factory has even expanded its work force, thanks to inputs arriving from Egypt. The World Bank cites a rate of 29 percent unemployment in Gaza, significantly above the West Bank’s 19 percent. But the figure takes no account of the tunnel enterprise, Gaza’s largest private-sector employer, which the World Bank considers black-market activity despite Hamas’ efforts to formalize the supply lines.
Via. The substance here seems to be that Hamas have used the proceeds from smuggling to get out from under the donor economy problem you see in places like Timor Leste. And check out the Israeli countermeasures:
On the evidence, many of these measures are designed more to tweak Hamas’ nose than to meet Gaza’s needs. The day after declaring the siege lifted, Israel lowered its drawbridge to allow in 1,100 gallons of oil, a commodity that already arrives in much ampler and cheaper quantities via Egypt and from which Hamas derives tax. It has lifted its ban, too, on gravel, threatening Gaza’s local production that Hamas also oversees. Insecticides, too, are now permitted, just as the Agriculture Ministry is encouraging farmers to grow organic.
This was presented as a liberalization of the blockade after the Israeli assault on the aid flotilla. Anyway, read the whole thing. The author, who covers Palestinian affairs for the Economist, also believes that Netanyahu would prefer a deal of some sort with Hamas than with the PA.
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