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<div class="header reader-header reader-show-element" dir="ltr"> <font
size="-2"><a class="domain reader-domain"
href="https://www.counterpunch.org/2018/10/02/everyone-washes-their-hands-as-gazas-economy-goes-into-freefall/">https://www.counterpunch.org/2018/10/02/everyone-washes-their-hands-as-gazas-economy-goes-into-freefall/</a></font>
<h1 class="reader-title">Everyone Washes Their Hands as Gaza’s
Economy Goes into Freefall</h1>
<span class="post_author_intro">by</span> <span
class="post_author" itemprop="author"><a
href="https://www.counterpunch.org/author/jonathan-cook/"
rel="nofollow">Jonathan Cook</a> - October 2, 2018</span></div>
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<p>The moment long feared is fast approaching in Gaza,
according to a new report by the World Bank. After a
decade-long Israeli blockade and a series of large-scale
military assaults, the economy of the tiny coastal
enclave is in “freefall”.</p>
<p>At a meeting of international donors in New York on
Thursday, coinciding with the annual meeting of the
United Nations General Assembly, the World Bank painted
an alarming picture of Gaza’s crisis. Unemployment now
stands at close to 70 per cent and the economy is
contracting at an ever faster rate.</p>
<p>While the West Bank’s plight is not yet as severe, it
is not far behind, countries attending the Ad Hoc
Liaison Committee were told. Gaza’s collapse could bring
down the entire Palestinian banking sector.</p>
<p>In response, Europe hurriedly put together a €40
million aid package, but that will chiefly address
Gaza’s separate humanitarian crisis – not the economic
one – by improving supplies of electricity and potable
water.</p>
<p>No one doubts the inevitable fallout from the economic
and humanitarian crises gripping Gaza. The four parties
to the Quartet charged with overseeing negotiations
between Israel and the Palestinians – the United States,
Russia, the European Union and the UN – issued a
statement warning that it was vital to prevent what they
termed “further escalation” in Gaza.</p>
<p>The Israeli military shares these concerns. It has
reported growing unrest among the enclave’s two million
inhabitants and believes Hamas will be forced into a
confrontation to break out of the straightjacket imposed
by the blockade.</p>
<p>In recent weeks, mass protests along Gaza’s perimeter
fence have been revived and expanded after a summer
lull. On Friday, seven Palestinian demonstrators,
including two children, were killed by Israeli sniper
fire. Hundreds more were wounded.</p>
<p>Nonetheless, the political will to remedy the situation
looks as atrophied as ever. No one is prepared to take
meaningful responsibility for the time-bomb that is
Gaza.</p>
<p>In fact, the main parties that could make a difference
appear intent on allowing the deterioration to continue.</p>
<p>Israeli Prime Minister Benjamin Netanyahu has ignored
repeated warnings of a threatened explosion in Gaza from
his own military.</p>
<p>Instead, Israel is upholding the blockade as tightly as
ever, preventing the flow of goods in and out of the
enclave. Fishing is limited to three miles off the coast
rather than the 20-mile zone agreed in the Oslo accords.
Hundreds of companies are reported to have folded over
the summer.</p>
<p>Intensifying the enclave’s troubles is the Trump
administration’s recent decision to cut aid to the
Palestinians, including to the United Nation’s refugee
agency, UNRWA. It plays a critical role in Gaza,
providing food, education and health services to nearly
two-thirds of the population.</p>
<p>The food budget is due to run out in December, and the
schools budget by the end of this month. Hundreds of
thousands of hungry children with nowhere to spend their
days can only fuel the protests – and the deaths.</p>
<p>The Palestinian Authority of Mahmoud Abbas,
headquartered in the West Bank, has no incentive to
help. Gaza’s slowly unfolding catastrophe is his
leverage to make Hamas submit to his rule. That is why
the Palestinian Authority has cut transfers to Gaza by
$30 million a month.</p>
<p>But even if Abbas wished to help, he largely lacks the
means. The US cuts were imposed primarily to punish him
for refusing to play ball with US President Donald
Trump’s supposed “deal of the century” peace plan.</p>
<p>Israel, the World Bank notes, has added to Abbas’s
difficulties by refusing to transfer taxes and customs
duties it collects on the PA’s behalf.</p>
<p>And the final implicated party, Egypt, is reticent to
loosen its own chokehold on its short border with Gaza.
President Abdel Fattah El Sisi opposes giving any
succour either to his domestic Islamist opponents or to
Hamas.</p>
<p>The impasse is possible only because none of the
parties is prepared to make a priority of Gaza’s
welfare.</p>
<p>That was starkly illustrated earlier in the summer when
Cairo, supported by the UN, opened a back channel
between Israel and Hamas in the hope of ending their
mounting friction.</p>
<p>Hamas wanted the blockade lifted to reverse Gaza’s
economic decline, while Israel wanted an end to the
weekly protests and the damaging images of snipers
killing unarmed demonstrators.</p>
<p>In addition, Netanyahu has an interest in keeping Hamas
in power in Gaza, if barely, as a way to cement the
geographic split with the West Bank and an ideological
one with Abbas.</p>
<p>The talks, however, collapsed quietly in early
September after Abbas objected to the Egyptians. He
insisted that the Palestinian Authority be the only
address for discussions of Gaza’s future. So, Cairo is
yet again channelling its energies into a futile attempt
at reconciling Abbas and Hamas.</p>
<p>At the UN General Assembly, Trump promised his peace
plan would be unveiled in the next two to three months,
and made explicit for the first time his support for a
two-state solution, saying it would “work best”.</p>
<p>Netanyahu vaguely concurred, while pointing out:
“Everyone defines the term ‘state’ differently.” His
definition, he added, required that not one of the
illegal Jewish settlements in the West Bank be removed
and that any future Palestinian state be under complete
Israeli security control.</p>
<p>Abbas is widely reported to have conceded over the
summer that a Palestinian state – should it ever come
into being – would be demilitarised. In other words, it
would not be recognisable as a sovereign state.</p>
<p>Hamas has made notable compromises to its original
doctrine of military resistance to secure all of
historic Palestine. But it is hard to imagine it
agreeing to peace on those terms. This makes a
reconciliation between Hamas and Abbas currently
inconceivable – and respite for the people of Gaza as
far off as ever.</p>
<p><em>A version of this article first appeared in the
National, Abu Dhabi.</em></p>
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