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Gaza's tunnel trade cash crisis

Wednesday, October 09, 2013 - 01:46

Oct. 9 - Thousands of civil servants in Gaza may not be paid in full thanks to the crisis in Eygpt. Hamas says its all because a network of tunnels used to smuggle goods into the Islamist-run enclave are being destroyed. Hayley Platt reports.

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It's not the first time there's been a cash crisis in Gaza - but this one's being blamed on Egypt not Israel. Tunnels which are used to smuggle everything from food and fuel to weapons are being destroyed by the Egyptians. They say Hamas is aiding Muslim militants in the Sinai desert via the tunnels. But their actions have left civil servants in the blockaded enclave facing the prospect of reduced salaries this month. (SOUNDBITE) (Arabic) ABU MOHAMMED, CIVIL SERVANT, SAYING: "Egypt has shut down 90 percent of the tunnels. A carton of milk - which I could never afford anyway - has gone up 20%. And there is a fuel crisis too" Hamas collects taxes on each item brought through the tunnels. It says they account for 40% of its income. But some economists inside Gaza argue it's more like 70%. It's certainly a big market - until recently 1 million litres of fuel and 3,000 tonnes of cement had been coming into Gaza via the tunnels every day. Hamas' Economy Minister Ala Al-Rafati says they're essential. (SOUNDBITE) (Arabic) ALA AL-RAFATI, HAMAS APPOINTED MINISTER OF ECONOMY, SAYING: "This situation has brought about the losses that the Palestinian economy is suffering. We estimate these losses have reached more than 460 million dollars." Last month Hamas was only able to pay around three-quarters of its $25 million payroll. This month it hopes to make a special 280 dollar payment to its 50,000 staff ahead of the Eid holiday. But they may not get much more. Hamas' decision to turn against Syria's President over the civil war there hasn't helped either. He's an ally of Iran, which reportedly used to give Hamas quarter of a million dollars a year.

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Gaza's tunnel trade cash crisis

Wednesday, October 09, 2013 - 01:46