By Adam Hanieh
JERUSALEM — Head towards the Gaza coast, past the smiling billboards of Yasser Arafat, and you will soon find what would once have been considered a joke — Gaza's tourist area. Here you can sip fruit cocktails and watch the sunset from one of the many hotels where construction costs have run into the millions.
Around the corner, in the exclusive Rimal area, is Arafat's guest house. Nearby is his deputy Abu Mazen's new $2 million mansion, complete with wood panelling, a rarity here. The only thing out of place is the graffiti, scrawled in Arabic: "This is your reward for selling Palestine".
A 10-minute taxi ride presents a different reality: the open sewers of the refugee camps. A walk down the main street of Gaza brings young children handing out prayers — the "respectable" way to beg. Around 12% of boys between the ages of 12 and 16 work full time in Gaza.
Since the Oslo agreement was signed in 1992, per capita GNP in the occupied territories has declined by close to 40%. The unemployment rate in mid-1996 had increased by 60% from 1995 levels, while wages fell by 16%. Nearly 42% of families in Gaza have been forced to sell property to buy food.
Last month the murder and robbery of a popular Gaza money changer provoked a three-day strike in a city unaccustomed to economic crimes of violence.
"The only thing Oslo has brought is an increasing gap between rich and poor. There is no middle class any more", said one Gazan resident who works around the corner from the scene of the shooting.
A strong impetus for the Oslo accords was the supposed economic benefits that would follow for Palestinians, Israelis and the Arab world. Since the 1967 Israeli occupation of the West Bank and Gaza, their economies have been closely tied to Israel's. The vast majority of Palestinian imports come from Israel, while it is also the destination for most Palestinian exports.
The 1994 Paris economic accords, signed by the Palestine Liberation Organisation and Israel, spelled out the economic relationship. The accords gave the Israelis the right to control the exports and imports of Palestinian goods.
According to a director of a leading agricultural NGO in Gaza, this has brought "the ridiculous situation where Palestinian farmers have been forced to uproot fruit and vegetable crops, which they previously exported to Israel, and replace them with sunflowers. You can't feed yourself with sunflowers."
Investment
The almost complete lifting of the Arab boycott of the Israeli economy has prompted more Israeli investment in other Arab countries — ironically at the expense of the Palestinians.
A feature of Israeli-Palestinian economic agreements has been the establishment of industrial parks (resembling the free trade zones of Taiwan and Mexico) sponsored by Israeli, Palestinian and US capital, designed to overcome the security problems of Palestinian workers in Israel.
Over the last few years Palestinian access to jobs in Israel has been sharply curtailed (from 116,000 in 1992 to 29,500 in 1995). This has particularly affected the Gaza Strip.
A number of the industrial parks, built with the enthusiastic backing of the World Bank, have yet to begin functioning because Israeli businesses still prefer to invest elsewhere. Wages of skilled garment workers in Jordan, for example, are $120-150 a month compared to $450 a month in Gaza.
Israeli companies, acting as agents for Marks and Spencer, have relocated from Gaza to Egypt, where Israeli merchants earn $8 for every dollar flowing to Egyptian merchants.
Israeli companies also dominate the industries of the occupied territories. Some 1600 firms make up the textile and garment industry, the largest industry in the West Bank and Gaza Strip. Of these, 80-90% are subcontractors to Israeli companies. The Palestinian capitalist class, acting as agents for the Israeli bourgeoisie, is making its profits in conjunction with Israeli capitalists.
Monopolies
Although this is not a new feature of the Palestinian economy, it has increased since Oslo. Monopolies, operated by ministers and senior figures within the Palestinian Authority, control 27 basic commodities, including steel, cement, petrol and meat.
The largest is petrol, headed by Arafat's senior economic adviser, Mohammed Rashid. Rashid has signed a deal with the Israeli company Dor to supply all the petrol in the West Bank and Gaza Strip.
Dor supplies the fuel to Rashid, who then sells it at exorbitant prices to service stations, which purchase from Rashid for fear of the Palestinian security forces. One of Dor's managers is Shmuel Goren, Israel's chief military coordinator for the territories during the intifada years.
Rashid also controls the cement monopoly allied to the Israeli company Nesher. Eighteen per cent of Nesher's revenue comes from the West Bank and Gaza Strip.
Rashid's company office is located with the offices of the construction company owned by the brother of Jamil Tarifi. Tarifi is minister for civil affairs in the Palestinian Authority (PA). He is also known as the "minister for settlements" because some of his dealings involve settlement construction.
Nabil Sh'ath, minister for international planning, owns an Egyptian computer company that supplies most of the PA's computers. The company, Team International, has signed a half-million dollar contract to install a network for the PA.
The head of preventive security in Gaza, Mohammed Dahlan, runs the gravel monopoly. The August issue of People's Rights, published by a Palestinian NGO, exposed the collaboration between the head of preventive security in the West Bank, Jibril Rajoub, and Israeli stone companies, which prefer the area's relative lack of regulations.
Some 80% of Israeli stone comes from the West Bank. In July, Rajoub was involved in seizing land from Palestinians near Hebron for quarries. Residents claim that one of the landowners had his thumb chopped off by Palestinian security forces to get his "agreement" to the land seizure.
A May report into waste and mismanagement found $326 million had been misused by the PA. However, it failed to investigate the activities of Al-Bahar, the largest company under suspicion.
Al-Bahar is run by Hashem Hussein Abu Nideh, director general of the financial affairs department of Arafat and his wife Suha. Despite being an unregistered company, Al-Bahar uses the letterhead of the PA. Seventeen dollars of every $74 ton of cement sold in Gaza by Al-Bahar goes to Arafat's bank account.
Demoralisation
Because of such corruption, the Palestinian leadership is now widely held in contempt. Indeed, many believe this was the reason for the investigation into waste (initiated by Arafat and carried out by a relative from his office).
The lack of an effective opposition force has turned anger into demoralisation and despair. Samir, a former activist who left the Popular Front for the Liberation of Palestine last year and is now attempting to set up a youth centre in Gaza, told me, "Our leading activists of the intifada years have been integrated into the security apparatus of the Palestinian Authority, have been imprisoned or have retreated from political life. You can't get a job or a house here if you openly criticise the authority."
A student leader from the intifada years at Bir Zeit University commented: "The attitude of our people has changed since Oslo. Before we struggled together as a people. Now people are only concerned about money. This is clear from the recent protests in Hebron. The attitude of people outside Hebron towards these protests is often one of disdain or cynicism."
Even middle ranking cadre loyal to Arafat are disillusioned. Mohammed is a three-star army officer who has spent 30 years of his life with the PLO. He fought in Lebanon and trained in China, Libya and Yemen. In 1994 he returned to Gaza with his wife and four children.
Today he lives in a squalid two-bedroom house near the Khan Younis refugee camp. When asked what he thought of life as a returnee, he could only manage a wry smile and the words: "Forget Palestine. Just forget."
Palestinian politics is in transition. According to Samir, "Many people believe that Oslo was, in essence, a means to dissolve the 1967 borders in favour of the Israeli state. What remains to be seen is when a new Palestinian opposition will emerge that will reject the current course of normalisation with the Israeli bourgeoisie. For the sake of Palestine, I hope this is soon."