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. Much attention has already been devoted to the goods smuggled into Gaza, such as fuel and cement. Less well understood is the fact that, in exchange for these goods, cash has been steadily exported out of Gaza through the tunnels, at a rate of roughly $750 million per year. Cash is also flowing out of Gaza -- through the tunnels and via bank transfers -- to safe havens in Persian Gulf countries and Europe. The new wealthy class -- many associated with Hamas -- as well as established capital owners are concerned about keeping their money inside Gaza, preferring to move it abroad. And even with huge sums flowing out of the territory, there is still more cash than opportunities to invest it. In February 2009, for example, Gaza banks actually turned to Israels Central Bank with an odd request: to deposit excess cash reserves in Israel.
Posted on: Thu, 24 Jul 2014 09:18:03 +0000