Monday, January 23, 2012

  • Monday, January 23, 2012
  • Elder of Ziyon
I had missed this important article published by Ehud Yaari and Eyal Ofer earlier this month:

Since Israel's August 2005 withdrawal from the Gaza Strip, Hamas has evolved from a relatively small movement into a well-funded conglomerate. Instead of being crippled by sanctions and siege, the organization has found ways to surmount early difficulties -- such as frequent payroll delays -- and establish an effective system of governance, ever tightening its grip over its fiefdom. As a result, Hamas has been able to empower loyalists while leaving the main burden of responsibility for Gaza's 1.6 million residents to others. Unfortunately, both the Ramallah-based Palestinian Authority (PA) and international donors have tolerated this situation, effectively contributing, if indirectly, to Hamas coffers.

The IMF estimated Gaza's 2009 gross domestic product (GDP) growth at 12 percent, an impressive number. According to a September 2010 IMF report, the total Gazan and West Bank GDP was $7 billion, while the gap in per capita income between the two areas was 48 percent; this data, combined with other relevant statistics, implies that Gaza's per capita GDP was around $1,400, much of which derives from payments by the PA. Transfers and remittances added 50 percent more income, implying that average total per capita income was, in fact, $2,100. Yet much of this income does not represent productive economic activities, and unemployment remains high -- probably around a third of the workforce.

One must also take into account the considerable trade conducted via the more than 800 tunnels into Egypt. Based on fragmentary evidence, this trade likely peaked at around $600-850 million per year. ...

Where does all this cash come from? ..The cash inflow seems to come primarily through banks. According to Palestinian banking officials, an average of $2 billion per year has been transferred into Gaza via the Palestinian banking system since Hamas's June 2007 military takeover. The PA alone wires an estimated $1.2 billion per year into Gaza banks, much of it as pensions and salaries for the 77,000 employees kept on the payroll even though they are not working. In fact, this estimate may be conservative; according to PA prime minister Salam Fayad, 54 percent of the PA's $3.17 billion 2010 budget went to Gaza. Most of that figure appears to be salaries, although it also covers what the PA pays directly for electricity, fuel, and water provided to Gaza by Israeli firms.

In addition, the UN Relief and Works Agency annually transfers about $200 million in cash to Gaza, along with $250 million per year worth of goods, grains, and fuel. Cash is also transferred into Gaza by the 160 nongovernmental organizations operating there, by international organizations such as the World Bank, and by foreign government aid organizations, although much of what they spend arrives in the form of goods shipped via Israel.

Hamas likely raises as much as $250 million annually via taxes. ... Hamas also regulates many types of businesses -- from street vendors to Gaza's twenty money-changing companies -- requiring them to pay license fees. In addition, taxes are collected on "luxury" goods coming from Israel, and even on motorcycles and carts.

Hamas also takes a hefty cut from the Egyptian tunnel trade, imposing high "customs" duties and a daily fee on local tunnel contractors.

...Hamas is also exploiting its control over various Gaza resources, such as leasing government-owned heavy machinery to private contractors for a daily fee. This is one of many ways the group has been able to indirectly benefit from the international reconstruction funds flowing into Gaza.

In 2005, Hamas was a modestly sized organization of 4,000-7,000 military personnel, with a small charity and education network and a skeletal party bureaucracy. From 2006 to 2010, however, the funds at the group's disposal reportedly grew from $40 million to $540 million. At the same time, Hamas has gained full control over all government ministries and municipal councils in Gaza, as well as many civilian agencies. It also holds a monopoly of power over every security and intelligence service in the territory, such as the 10,000-strong "blue" police. In total, Hamas pays salaries to at least 35,000 employees, among them many of the 20,000-plus armed personnel. Given this apparent payroll and an estimated average monthly salary of NIS 1,500 ($425), the group may be spending -- according to Prime Minister Ismail Haniyah -- as much as $300 million per year on salaries, a sum greater than the entire PA payroll. Hamas also claims that it allocates $30 million annually to its activities in the West Bank, without disclosing the methods by which funds arrive there.

...In addition to its own direct spending, Hamas has been able to tap into financial resources transferred by the PA and aid agencies, ensuring payments to supporters who have replaced Fatah loyalists in government jobs. Lists used by donors to screen for terrorists include very few Hamas operatives; even if this problem were addressed, the screening of PA employees is largely done by Hamas sympathizers. In total, thousands of Hamas members, including many military personnel with fake civilian positions, are paid by outside donors.

The movement has also recently turned to purchasing all sorts of businesses and initiating new ventures, such as the Islamic Bank, the al-Multazim insurance firm, housing projects, hotels, a shopping mall, resorts, agricultural farms, and a fish hatchery. In fact, Hamas's economic mini-empire is fast becoming the main player in Gaza's private sector. The group often forces businesses to close down in order to eliminate competition. It also coerces owners into selling items for cheap or "contributing" to Hamas either in cash or in kind (e.g., building materials). Frequently, new Hamas businesses are registered under the names of straw owners or individuals from Hamas cadres. The group has also taken over all the land belonging to the former Israeli settlement of Gush Katif, along with parts of the Gaza beachfront.

Soon after its 2006 electoral victory in Gaza, Hamas faced great financial difficulties, leading the group to smuggle millions of dollars in cash through Egypt. Today, however, Hamas has managed to develop local sources of steadily growing income, mainly by exploiting the huge aid sums transferred by the PA and international donors to sustain the general population. No effective mechanism is in place to prevent the group from taking advantage of the constant cash flow into Gaza; as a result, a significant part of the money intended to help alleviate the hardship of the region's inhabitants has gone to waste. More rigorous measures are needed to restrict Hamas's ability to siphon off such funding for its own purposes.

Economic sanctions against Hamas have failed, badly.

And this is a major reason why there will never be real unity between Hamas and Fatah - Hamas has too much too lose.

(h/t Yoel)

EoZTV Podcast

Podcast URL

Subscribe in podnovaSubscribe with FeedlyAdd to netvibes
addtomyyahoo4Subscribe with SubToMe

search eoz

Loading...

comments

Speaking

follow me

Follow by Email

Contact

Elder: elder -at- elderofziyon dot com
Mrs. Elder: mrs.elder -at- elderofziyon.com


translate

E-Book

For $18 donation








Sample Text

EoZ's Most Popular Posts Ever

Hasbys!

Elder of Ziyon - حـكـيـم صـهـيـون

Elder of Ziyon - حـكـيـم صـهـيـون
This blog may be a labor of love for me, but it takes a lot of effort, time and money. For over 11 years and over 23,000 articles I have been providing accurate, original news that would have remained unnoticed. I've written hundreds of scoops and sometimes my reporting ends up making a real difference. I appreciate any donations you can give to keep this blog going.

Donate!

Monthly subscription:
Payment options

One time donation:

subscribe via email

Follow EoZ on Twitter!

Tweets

Compliments

The Jerusalem Report:"A seemingly indefatigable one-man operation, armed only with a computer, chutzpa and stamina."

Algemeiner: "Fiercely intelligent and erudite"

Omri: "Elder is one of the best established and most respected members of the jblogosphere..."
Atheist Jew:"Elder of Ziyon probably had the greatest impression on me..."
Soccer Dad: "He undertakes the important task of making sure that his readers learn from history."
AbbaGav: "A truly exceptional blog..."
Judeopundit: "[A] venerable blog-pioneer and beloved patriarchal figure...his blog is indispensable."
Oleh Musings: "The most comprehensive Zionist blog I have seen."
Carl in Jerusalem: "...probably the most under-recognized blog in the JBlogsphere as far as I am concerned."
Aussie Dave: "King of the auto-translation."
The Israel Situation:The Elder manages to write so many great, investigative posts that I am often looking to him for important news on the PalArab (his term for Palestinian Arab) side of things."
Tikun Olam: "Either you are carelessly ignorant or a willful liar and distorter of the truth. Either way, it makes you one mean SOB."
Mondoweiss commenter: "For virulent pro-Zionism (and plain straightforward lies of course) there is nothing much to beat it."
Didi Remez: "Leading wingnut"

Interesting Blogs

Categories

Abbas liar Academic fraud administrivia al-Qaeda algeria American Jews Amnesty analysis anti-semitism apartheid arab refugees Arafat archaeology art ASHREI B'tselem bahrain bbc BDS BDSFail Bedouin Beitunia beoz book review breaking the silence Cardozo Chanukah Christians conspiracy theories Cyprus Daphne Anson Davis report DCI-P double standards Egypt Elder gets results ElderToons Electronic Intifada EoZNews eoztv Erekat EU Euro-Mid Observer Fake Civilians 2014 Fatah featured Features fisking flotilla Forest Rain free gaza freedom of press palestinian style future martyr Gary Spedding gaza Gaza Platform George Galloway George Soros gideon levy gilad shalit gisha Goldstone Report Good news Grapel Guardian gunness Haaretz hamas Hamas war crimes hasbara Hasby 2014 Hasby 2016 Hebron helen thomas hezbollah history Hizballah Holocaust denial honor killing HRW Human Rights Humanitarian crisis humor Hypocrisy ICRC Ilan Pappe impossible peace incitement Indonesia international law intransigence iran Iraq Islamic Judeophobia Islamism Israel Loves America Israeli culture Israeli high-tech J Street jabalya jeremy bowen Jerusalem jewish fiction Jewish Voice for Peace jihad jimmy carter John Kerry jokes jonathan cook Jordan Juan Cole Judea-Samaria Kairos Karl Vick ken roth khalid amayreh Khaybar Lebanon leftists Linkdump lumish mahmoud zahar Malaysia max blumenthal McGraw-Hill media bias Methodist Miftah Mohammed Assaf Mondoweiss moonbats Morocco music Muslim Brotherhood Nakba Natural gas Nazi News nftp NGO NIF norpac NYT Occupation offbeat Omar Barghouti Opinion oxfam PA corruption PalArab lies Palestine Papers pallywood pchr PCUSA Peter Beinart Petra MB poll Poster Preoccupied Prisoners propaganda Proud to be Zionist purimshpiel Qaradawi Qassam calendar Rafah Ray Hanania real liberals reference Richard Falk rogel alpher roger cohen roger waters Saudi Arabia saudi vice self-death self-death palestinians sex crimes SFSU shechita sheikh tamimi Shujaiyeh SodaStream South Africa Speech stamps Syria Tarabin Temple Mount Terrorism This is Zionism Thomas Friedman Tunisia Turkey UCI UK UN UNDP unesco unhrc United Arab Emirates Unity unrwa UNRWA hate unrwa reports UNRWA-USA Varda Vic Rosenthal Washington wikileaks work accident X-washing Yemen zahran zionist attack zoo Zvi

Blog Archive