Easing of Gaza Blockade Leaves Many Smugglers Idle

RAFAH, Gaza Strip -- Israel's easing of its Gaza blockade has accomplished something Israeli bombing raids and an underground steel wall could not: It has devastated the Hamas-ruled territory's once thriving smuggling industry.

Now that most consumer goods can again reach Gaza through Israel -- after three years of tight border closures -- many of the hundreds of smuggling tunnels that once served as the Palestinian territory's lifeline have simply shut down.

Only a few dozen are still active, compared to a total of about 400, a Hamas government official said. And an Associated Press spot check in one former smuggling hot spot found only one in four tunnels working.

The sharp decline is not believed to have affected a steady influx of weapons and other contraband through special Hamas-controlled tunnels, seen as crucial to the militants' continued hold on power. The Iranian-backed group seized Gaza by force in June 2007.

However, when it comes to consumer goods, Gaza merchants prefer to import legally through land crossings with Israel. Those shipments tend to be cheaper and more predictable than the illicit trade, which is subject to Egyptian crackdowns, Israeli attacks and treacherous collapses.

Israel eased the closure in June in an attempt to deflect mounting international criticism following its deadly raid of a Gaza-bound international flotilla.

Palestinian smugglers have had to scale back, limiting themselves to goods still restricted by Israel on security grounds, such as construction materials like cement and steel, and goods that are significantly cheaper in Egypt.

"We are running out of business these days," complained smuggler Saber Salem, 36, who used to operate three tunnels along the Gaza-Egypt border, with five business partners and 40 workers. Now, he runs one tunnel with 15 employees.

Salem's most recent haul was olive oil smuggled in from Egypt -- which, at $30 a gallon, was nearly half the price of oil brought in from Israel.

At its height, the six miles of tunnels along the Gaza-Egypt border were a bustle of activity, alive with the hum of generators and rumble of trucks making their way for pickup. Tents marked tunnel entrances every few yards.

On a recent evening last week, there was noticeably less activity. Only a few vans and trucks were parked near tunnel entrances waiting to be loaded. The buzz of unmanned Israeli aircraft could be heard overhead, and from time to time, Egyptian border guards trained spotlights on the area from nearby watchtowers.

Smuggling is a Gaza tradition, established after Israel captured the Palestinian territory from Egypt in the 1967 Mideast War. Over the next 38 years of Israeli control, it was largely limited to weapons and other contraband.

The underground trade intensified after Israel withdrew from Gaza in 2005 and reached unprecedented levels after Israel clamped a full closure on the territory following the Hamas takeover.

The closure, which permitted only minimal amounts of food and medicine into Gaza, failed to weaken Hamas. Over the summer, Israel eased the blockade following its heavily criticized sea raid in which Israeli forces killed nine Turkish activists.

The impact was immediate.

Issa Nashar, the Hamas mayor of Rafah, the town closest to the tunnels, said only several dozen of about 400 registered passageways are still active. An AP spot check in the area around Salah Edine Gate, once a passenger crossing between Egypt and Gaza, found only 11 out of 40 tunnels were still operating.

Many of the thousands of young men who used to work in the tunnels are now idle.

Khalil Saleh said that when demand was at its peak, he would earn $100 a day, several times the average for unskilled workers in Gaza. Now the 19-year-old makes just half that amount -- when he can find work.

"The golden era is over," he said as he carried two jerrycans of olive oil out of Salem's tunnel. "This is my first work day in the past two weeks."

At its busiest, the tunnel industry was a major source of employment in Gaza's battered economy. The Hamas government also benefited by levying taxes and other fees on smugglers.

While the easing of the blockade has spurred modest economic growth in Gaza, economists say real recovery is unlikely because continued Israeli restrictions suppress Gaza's key industries -- local construction and the export of textiles, furniture and agricultural products.

Israel still restricts cement and steel imports for fear Hamas could divert them to build fortifications and rockets. Exports are limited to seasonal shipments of strawberries and cut flowers because Israel fears militants could try to smuggle out bombs.

Some of the tunnel operators, meanwhile, have tried to find new markets by smuggling in the opposite direction -- from Gaza to Egypt. But it's risky.

Salem said he recently shipped scrap metal to Egypt, but that Egyptian border police discovered and blew up his tunnel exit on the Egyptian side after two shipments.

He said other tunnel operators have sent chicken and eggs to Egypt, but he doesn't know if they plan to continue.

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

In the end, the laws of supply and demand have proved more effective than years of Israeli air raids or the underground steel wall Egypt built along much of the 12-mile (20-kilometer) border.

Salem said he now makes only about $15,000 a month, a fraction of the up to $30,000 a day he earned before.

In the meantime, Salem and his remaining fellow smugglers try to fill the gaps in the market. This includes exotic pets such as monkeys and baby crocodiles, but also fuel, cement and steel for construction.

For the upcoming Muslim holiday of Eid al-Adha, or the "Feast of Sacrifice," smugglers have started bringing in sheep and cows for slaughter, to supplement what's coming in from Israel, where bottlenecks at the only cargo crossing mean supply hasn't kept up with demand. Last week, smugglers hoisted calves up by ropes through a tunnel shaft.

Saleh, the tunnel worker, was trying to be philosophical about the downturn. "We were the lords of Gaza for three years, but as people say, 'Nothing lasts forever,"' he said.