Tuesday, September 18, 2007

Tough Times In Gaza

.....One reason is Hamas’s near-monopoly on guns and ammunition, which is destroying the less salubrious arms-smuggling business of Muhammad, 37, who lives in Rafah. His father dug one of the first tunnels between Gaza and Egypt in 1984, Muhammad said proudly — 50 meters, to smuggle gold and spare parts.

Now his son, who agreed to talk if his last name is not printed, digs tunnels a kilometer long to escape detection. Such a tunnel — one meter square and 12 meters deep to hit the hard mud near the water table, takes six months and costs about $40,000. At the Egyptian end, the tunnel branches in numerous directions, to allow various “eyes,” or openings.

When the shipment is in place above ground, diggers quickly break the surface. Six workers take 30 minutes to pull the goods down, moving cartons to storage rooms previously built on either side of the tunnel near the eye. Then the Egyptian partner covers the eye and disappears, and the cartons are winched back to Gaza.

But the new rule of Hamas has been a disaster for Muhammad. Hamas has banned the carrying of weapons by anyone except its own forces and banned the firing of weapons, even at marriages and funerals. With Fatah defeated and dispersed, and Fatah’s large stock of ammunition and guns captured by Hamas, the arms market for people like him, Muhammad said, has collapsed like a weak tunnel.

The price of the best AK-47 rifles, made either in Russia or former Yugoslavia, has fallen from $2,200 before June to $500 now, he said, roughly the price paid for them in Egypt. The last shipment he knows about was bought and stored by a Gazan arms dealer as an investment, “hoping the situation will get bad again,” Muhammad said, laughing.

Chinese or Czech versions were $1,400, and now no one wants them.

An AK-47 bullet, before June, cost $8.80 — “the price of eight shwarma” sandwiches, he said, “enough to feed a family.” His profit was $6.58. Even before the Hamas election, in 2005, the price was between $3.45 and $4.40. Now a bullet costs $1.21.

In Egypt, the same bullet costs 73 cents, 40 percent less. But with the expense of tunneling and bribing, Muhammad said, the current profit on a bullet is less than 5 cents.

A rocket-propelled grenade launcher with six grenades cost $900 in Egypt and could be sold in Gaza for $6,000. Now, the price is $1,000, but no one is buying.

Before, a shipment of 300 AK’s, 500,000 bullets and 50 rocket-propelled grenades “was easy, light and quick, and made a profit of $500,000,” Muhammad said. “If you lost a tunnel, okay. But not now.”

Hamas is working with the Egyptians to destroy unauthorized tunnels, Muhammad said, while the Egyptians, under pressure from the United States and Israel, have recently changed all the security officers along the border, many of whom had been bought by smugglers. Egypt, he said, is clearing 300 meters of houses from the Egyptian side of Rafah, a city cut in two by the border.

When Israel cleared Palestinian houses in Rafah to stop smuggling tunnels, there was an international uproar and many demonstrations. Will there be demonstrations in Egypt? Muhammad roared with laughter.

“Hamas wants to control any arms or explosives that come into Gaza now, it’s very simple,” he said. “Hamas is cracking down, because they’re afraid we’ll sell to Fatah.”

Muhammad works with 10 partners and 12 workers. Extra diggers are paid $100 a day. The 12 workers get half the profit; the partners the other half.

“But there’s no business at all now,” Muhammad said, except in one commodity: nitrate, prized both for explosives and fertilizer. Hamas is trying to control nitrate imports, too, while taking a cut for allowing the business.

“Fatah demanded bribes,” he said. “Hamas doesn’t ask for money, but for nitrate,” taking a third of a shipment. Hamas then sells small amounts to other militant groups, like Islamic Jihad, Muhammad said.

Hamas says it refuses to stop other groups from carrying out “resistance” against Israel and the Israeli occupation, largely through Qassam rocket fire. “But Hamas tells us not to sell to Islamic Jihad,” Muhammad said. “They try to keep them on a quota to have more control over them.”

Israeli intelligence has testified to parliament that Hamas has smuggled 40 tons of explosives into Gaza since June and is building defensive fortifications underground, like Hezbollah. It is people like Muhammad who do the work.

Nitrate, while much less profitable than rifles and bullets in the bad old days, is still valuable, and easily available in Egypt. A ton is 20 bags, and the maximum he can take through a tunnel, he said, is four tons.

The profit from four tons of nitrate is $60,000. But now Hamas takes a third for free, leaving $40,000 in profit, or $2,000 for each partner. That’s better than the current dead market. “So we’re thinking about digging a tunnel now just for nitrate,” he said. “That’s the plan, anyway.”