This summer’s war between Israel and Hamas, like the previous rounds -- Operation Cast Lead in 2008-2009 and Operation Pillar of Cloud in 2012 -- exacted a terrible cost not only in human lives (more than 2,100 Palestinians and 73 Israelis[1]) but also in the wholesale destruction of Gaza’s infrastructure.  The Palestinian Authority estimates reconstruction and rehabilitation costs of the recent conflict to exceed $4 billion, more than two times Gaza’s GNP.[2]

Read more than 50 nations are expected to convene in Cairo on October 12 for a one-day pledging conference to mobilize international support for this reconstruction and economic rehabilitation. Norway and Egypt are co-sponsors of this latest effort to rebuild Gaza, as they were at a similar meeting convened in Sharm el Sheikh after Israel and Hamas fought a three-week battle that ended in mid-January 2009. While there are some indications that the outcome of this conference could prove more favorable to Gaza’s economic well being, most signs point to a continuation of the status quo.

As in Sharm el Sheikh, the meeting in Cairo can be expected to result in promises of more money than will actually be delivered. In 2009, donor pledges fell far short of the $1.3 billion reconstruction price tag, in part because of Israel’s continuing restrictions on the transfer of reconstruction materials to Gaza. Those restrictions remain.

Of course, money alone will not solve Gaza’s problems. Gaza -- and more broadly Palestine as a whole -- must be enabled to manufacture and trade across open borders governed by internationally accepted standards of security and transparency. As a recent report by the IMF explains, “The experience after the 2008/09 conflict indicates that without a lifting or at least easing of the blockade of Gaza, especially allowing the entry of construction materials, rebuilding efforts are likely to be unsuccessful.”[3]

Ever more stringent restrictions on the movement of people and goods to Gaza from Israel and Egypt have been a central feature of Gaza’s life since the first Gulf War in 1991. After Hamas’s ouster of PLO forces in June 2007, Gaza was placed under a draconian Israel-imposed quarantine. Gaza’s borders were all but closed to regular trade, and commercial imports and exports were, for all practical purposes, prohibited. As a result, Gaza moved from an economic system based on the traditional elements of trading and producing to one based on humanitarian assistance provided by an increasingly dispirited international community.

This system succeeded in engineering Gaza’s, and as a consequence, Palestine’s endemic dependence upon declining international handouts, but it failed to weaken either Hamas’s or Israel’s willingness to wage periodic wars that have done little more than to regularly wreak tremendous destruction on Gaza’s long-suffering population of 1.8 million and feed Israel’s chronic sense of insecurity.

Israel's chief of staff Lt. Gen. Benjamin Ganz noted in a recent Haaretz interview that Gaza must be permitted to restore and to develop a trading and manufacturing economy. Israel, says the army chief who planned and executed the latest round of destruction, that, in the words of Prime Minister Benjamin Netanyahu, “pulverized” the Strip,[4] must now dispense with its policy of engineered deprivation and instead embrace a more liberal trade regime in order to create “an economic anchor that will consolidate the military achievements.”[5]

“We have to act rationally,” explained Ganz. “The Strip must be opened to goods -- there are 1.8 million people there, stuck between Israel, Egypt, and the sea.”

Palestinians across the political spectrum, including Hamas, agree. Hamas fought this summer in large measure in order to end the economic blockade, an objective that was widely supported. Hamas leaders have raised no objections to the report prepared for the Cairo conference by the Palestinian Authority, now formally governed by technocrats, that urges Israel to lift its blockade on Gaza.

"Free movement of people and goods will catalyze Gaza, catapulting it from its current crisis into socio-economic sustainability,” the report notes. “Freedom of access must be guaranteed. The borders must be opened. Trade must flow. People must travel."[6]

Although Israel will not be at the Cairo meeting, it holds the keys to Gaza’s future. In informal, unofficial internal discussions, Israelis are considering new options for modifying, if not ending, the siege. At one such recent meeting, according to one participant, the options for using Egypt’s Port Said and the Israeli port of Ashdod as maritime trade gateways for Gaza were discussed.[7]

Yet despite these discussions and Ganz’s sensible remarks -- and a number of minor, one-off, relaxations of the border regime in the run-up to the conference, including limited visits by Gazans to Jerusalem during Eid -- they remain a minority view in the Netanyahu government, which continues to favor keeping Gaza's economy on a destabilizing trajectory to the bottom.

A depressing return to business as usual -- that is, an inadequate effort to rebuild Gaza and the retention of the crushing humanitarian model of aid and development -- remains the default option for those attending in Cairo. Distracted by an array of even more pressing crises throughout the region, there appears to be little energy among participants to summon the political will to challenge the destabilizing views of the Netanyahu government and the shortcomings of Palestine's political class in order to put Gaza, and as a consequence the prospects for a sovereign independent Palestinian state, on more solid economic footing.

Most of those speaking in Cairo will warn of an inevitable resumption of armed conflict should Gaza’s economy remain stuck in an endless loop of deprivation and misery. As Israel’s own chief of staff acknowledges, the failure to create an environment where Palestinians and Israelis alike have a stake in success all but guarantees another even more deadly and destructive round.[8]




[1] See “Gaza Crisis: Toll of Operations in Gaza,” BBC, September 1, 2014, .

[2] Government of the State of Palestine, The National Early Recovery and Reconstruction Plan for Gaza, October 1, 2014, .  

[3] International Monetary Fund, “West Bank and Gaza: Report to the Ad Hoc Liaison Committee,” September 12, 2014, .

[4] Itamar Sharon, “Netanyahu: I Didn’t Want an Israeli Fallujah in Gaza,” The Times of Israel, August 30, 2014, .

[5] Amos Harel, “Outgoing IDF Chief Ganz: Now is the Time to Offer Gazans Hope,” Haaretz, October 3, 2014, .

[6] Government of the State of Palestine, The National Early Recovery and Reconstruction Plan for Gaza.

[7] Author’s discussions with informed, anonymous Israeli source.

[8] Harel, “Outgoing IDF Chief Ganz: Now is the Time to Offer Gazans Hope.”