An End to Gaza's (Literally) Underground Economy

RAFAH CITY, Gaza -- After a three-year absence from the store shelves of Gaza, a popular Israeli beverage called Tapuzina reappeared recently, only to disappear again in less than an hour. Eager residents, it turned out, had called each other excitedly and rushed to the supermarket. Some got the word but showed up too late. The drink was gone.
Tapuzina is one among many Hebrew brand names that returned to Gaza's stores after Israel eased its economic siege of the territory in June, following its deadly raid on the Turkish flotilla. Gazans have flocked to buy the new goods, which they say are higher-quality and cheaper than what was previously available--contraband ferried through tunnels from Egypt.

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But at the Egyptian border, in the heart of Gaza's tunnel industry, there's little if any rejoicing at the blockade's dismantlement. As Israeli consumer goods saturate Gaza's markets, the tunnels have lost their clientele. Smugglers understand that their days are numbered, but there's nothing to replace the jobs the industry provided.

"Work has run dry. Every day is getting worse and worse. It's the end of the tunnel period," says Abu Mohammad, a tunnel owner who has made millions from the industry. "It's not just me suffering. It's everyone in this business. ... No one knows what will happen to us."
Once the lifeline of the coastal enclave's economy, tunnels were set up as a workaround to the embargo Israel imposed after the Islamist group Hamas seized control of Gaza in 2007. At the industry's zenith in 2008 and 2009, approximately a thousand subterranean passageways snaked beneath the border to Egypt, transporting everything from potato chips to cars to weapons.
The resilient industry survived Israeli bombings, Egyptian gassing, and flooding. Days after the end of Israel's 22-day offensive in January 2009, activity in the tunnel zone was frenzied--generators hummed, pulleys screeched and loading trucks banged. Most recently, smugglers drilled through the steel subterranean wall Egypt began to construct last December.
Today, though, the tunnel district is eerily silent. Market traders have either bought Israeli or stalled orders in anticipation of new goods from the Jewish state. An estimated 10 percent of the tunnels are still operating, but even those work sporadically.
Most tunnels are concentrated about half a mile from the Egyptian border, in an area five miles long and less than two miles wide. They open up in neat rows, shaded by white and black plastic tents.
Abu Saber's tunnel is at the front line, closest to the Egyptian border. Rolls of smuggled iron sheet are stacked neatly at the passageway's entrance. The haul is Saber's first shipment in 10 days.
The sandy floor of his tunnel slopes downward, easing into the ground. Buttressed inside by iron walls, the tunnel is about five feet wide and high enough to walk only slightly hunched. Inside, it's muggy and dank, pungent with the smell of earth and human sweat.
Before the blockade was eased, Saber's tunnel, like many others, operated 24 hours a day, seven days a week and employed 10-12 people for each 12-hour shift, carting everything from chocolate to refrigerators. Now, Saber says, he's barely making enough hauling iron, steel, and ceramics--products that remain embargoed. And even profits on those have dropped dramatically.
"Before one ton of iron sold for $400 [U.S.], now it goes for between $150 and $200. These prices are not good enough for labor and expenses," Abu Saber laments.
Tunnel proprietorship costs. Owners say they spent between $150,000 and $500,000 to construct a tunnel and then another $2,600 to the local municipality for a license. Each month, $300 goes to electricity and water. They pay labor about $25 per shift. Maintenance adds up to between $2,000 and $3,000 a month. There are tunnel courts where laborers can take their employers if they don't pay salaries.
"The municipality treats the tunnels as a priority," says Issa El Nashar, mayor of Rafah City. "Like any other industry, it needs services and it needs facilities." The municipality provides power and water to the tunnels. Meanwhile, Hamas taxes cigarettes and fuel.

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Sarah A. Topol is a Cairo-based journalist. She has reported from Bahrain, Egypt, Israel and Palestine, Libya, Pakistan, the United Arab Emirates, and Yemen. Her writing has appeared in Foreign Policy, GQ, the New Republic, Newsweek, and Slate, among others.

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