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Gaza’s Reconstruction Prospects

Author: Esther Pan
September 29, 2005
This publication is now archived.

What progress has been made on reconstruction in the Gaza Strip?

Plans for reconstruction took a back seat as violence flared again between Palestinian militants and the Israel Defense Forces (IDF). After homemade rockets exploded during a September 23 Hamas rally, killing twenty-one people, Palestinian militants blamed Israel and fired dozens of rockets at it. The IDF immediately responded with heavy air strikes and the arrests of several hundred people. The strikes forced Hamas to unilaterally declare a halt to rocket attacks from Gaza on September 26; Israel continues to attack targets within Gaza. Experts say the renewed fighting shows the difficulties facing efforts to rebuild the damaged region. “There’s a will in the international community, the United States, and the Palestinian Authority (PA) to promote reconstruction in Gaza,” says Philip Wilcox, president of the Foundation for Middle East Peace and a former U.S. diplomat to the Middle East. “But it won’t happen unless there’s a level of security that can enable reconstruction to take place.”

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What security concerns are there now that the Israelis have left?

Gaza has been flooded with militants from Hamas and Islamic Jihad, who claim their armed resistance drove out the Israelis. Officials fear the militants will use Gaza as a base to stockpile weapons and fighters and launch attacks against Israel. To counteract this, Israel has placed strict controls on border crossings between Gaza and Israel and tightened customs regulations on goods traveling between Gaza, Egypt, and Israel. It also closed an Israeli customs terminal at Rafah on the Gaza-Egypt border, forcing goods to travel through the Kerem Shalom border point within Israel.

Experts say the worries are justified because Gaza is awash in weapons. PA officials say militant groups have twice as many guns as the PA security forces. Militants roam the streets, and armed gangs routinely carry out kidnappings and assassinations, including the brazen September 7 murder of Moussa Arafat, a former Gaza security chief and cousin of late PA President Yasir Arafat. Palestinian police chief Ala Husni said September 29 that public displays of weaponry would be banned in Gaza. Since the Israelis had left, he said, there was no more need for citizens to openly bear arms. “Any weapon now in the street is a criminal weapon,” he said. Husni said Hamas and other factions accepted the ban.

What are the economic conditions for Palestinians living in Gaza?

The Palestinian economy is in bad shape, wracked by corruption, violence, and security restrictions. Per capita income in the Gaza Strip is about $700 per year, compared with Israeli per capita income of $16,000 per year, according to the Palestinian Economic Council for Reconstruction and Development. Former World Bank President James Wolfensohn, the envoy to the disengagement process from the Quartet–the United Nations, United States, European Union (EU), and Russia—has worked with PA leaders to develop new social safety-net programs, job-creation initiatives, and a three-year plan to improve the Palestinian economy.

Does Gaza have any industry?

Not much, experts say. It is a small, crowded, resource-poor area, whose 1.3 million residents live on a piece of land six miles wide by twenty-six miles long—one of the highest population densities in the world. It has a highly educated population, but also strict limits on their movement and little access to markets in Egypt and Israel. The unemployment rate in Gaza and the West Bank is over 25 percent, and some 62 percent of families in the Palestinian territories live below the poverty line.

More than 3,000 Gaza greenhouses were purchased from Jewish settlers with $14 million in private donations—including $500,000 from Wolfensohn himself— so they could help boost Palestinian-run agriculture. Some 4,000 Palestinians work in the greenhouses, tending the herbs, lettuce, tomatoes, cucumbers, and flowers that Israeli settlers grew for the lucrative export market. But a frenzy of looting after Israeli troops pulled out left about 30 percent of the greenhouses damaged, PA officials said.

What kind of housing will be needed?

High-rises that can accommodate Palestinians’ large families, officials say. Gaza’s population is expected to double by 2020. PA officials said in August the Netzarim settlement south of Gaza will be used to build a port, offering Palestinians much-needed access to the sea. Some 3,000 residential units will be built on land nearby. PA officials have presented plans for over forty reconstruction projects to Wolfensohn, including roads, schools, hospitals, and other infrastructure. The construction is estimated to cost several hundred million dollars in international donor fund. Funds are available, experts say, but international donors are waiting for PA reforms to ensure the funds are not stolen or misappropriated, as donor funds have been in the past.

Which international donors have offered money to the PA?

The EU, France, Germany, Japan, and the U.S. Agency for International Development (USAID), among others, are participating in the rebuilding of Gaza. In early July, the leaders of the world's richest countries pledged $3 billion for Palestinian development at the Group of Eight summit in Scotland. British Chancellor of the Exchequer Gordon Brown will visit the Middle East in October to highlight Palestinian redevelopment efforts.

Who is in charge of the process on each side?

For the Israelis, Shimon Peres, the dovish Labor Party leader and deputy prime minister in Sharon’s current coalition government. For the Palestinians, Mohammed Dahlan, a former security chief and current civil affairs minister in the Abbas government. Both men work closely with Wolfensohn, as well as Lieutenant General William Ward, the U.S. security envoy to the Middle East.

What is the status of Fatah?

Fatah, the PA ruling party long led by Yasir Arafat, has been plagued with infighting between Arafat’s old guard and a younger group of leaders who want reforms to happen more quickly. Fatah has also been hurt by allegations of serious crime and corruption among its members, although experts say Abbas is taking steps to address this charge. “The popular perception of corruption in Fatah was correct in the past, but they’ve made a lot of progress in the last two years,” Wilcox says. Experts say Fatah will mount a strong campaign in the next months to convince voters it is the best party to lead the PA, in the face of strong competition from Hamas.

How strong is Hamas?

Since the second intifada began in 2000, Hamas has steadily gained support among Palestinians for its suicide attacks against Israel (which many Palestinians credit with driving IDF troops out of Gaza), its network of social services—including hospitals and schools—and its reputation for honesty. Fatah leaders saw Hamas as a strong enough threat to postpone local elections in Gaza; some 150,000 West Bank voters went to the polls September 29 in what was seen as a test of each party’s strength before PA parliamentary elections scheduled for January 25, 2006. Hamas, which opinion polls say has the support of about 30 percent of Palestinians, was very popular coming out of the disengagement, but it lost some credibility after the rocket incident, with many Palestinians blaming Hamas for provoking renewed attacks from the IDF.

What is the next step?

Abbas will meet U.S. President George Bush October 20 to discuss plans for developing the PA now that Israeli soldiers and settlers have left. Experts say Abbas and his party are under pressure to show Palestinians they can bring concrete improvements to the PA ahead of the parliamentary elections.

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