Destruction of tunnels end good times for Palestinian entrepreneurs

The destruction of the 1,200 tunnels into the besieged Gaza Strip ends a covert industry that provided Palestinians with everything from bags of cement to Kentucky Fried Chicken.

A Hamas policeman stands guard in an area of the tunnels that used to buzz with the sound of activity in the southern Gazan town of Rafah on February 18. Egypt destroyed the roughly 1,200 tunnels thatShow more

RAFAH, GAZA STRIP // There was a time when Abu Mohammed reaped almost unimaginable riches from a tunnel industry that spurred an unprecedented boom in this once sleepy border town.

More than a million dollars in cash passed through his hands in recent years, he said, from his business of hauling in construction material from Egypt to circumvent the Israeli blockade of Gaza.

Unlike dozens of tunnel operators in Rafah, who spent their sudden influx of cash on villas and flashy cars, Abu Mohammed played the long game. Dreaming of more bounty, he invested his earnings in building more tunnels.

But, after Egypt destroyed the 1,200 tunnels that bring Gazans everything from medicine, concrete and weapons to buckets of Kentucky Fried Chicken, those dreams have come crashing down.

Like many here, he faces ruin.

“I got greedy. That was my problem,” said Abu Mohammed, 30, a father of two whose five tunnels were blown up or bulldozed by the Egyptian military over the past eight months.

That left him with no way to pay back the US$80,000 (Dh294,000) in loans that he took out to construct more tunnels.

He now lives at his parents’ home in Rafah with wife and children.

“I didn’t buy a home or a fancy car like the others. I invested all of my money in the tunnels, and because of this, I lost everything,” said Abu Mohammed, who requested that his real name not be revealed because he feared retribution from Egyptian authorities.

Rafah faces the same grim conditions as the rest of Gaza, which suffers from near-constant war with Israel, grinding poverty and, according to the Palestinian Central Bureau of Statistics figures, nearly 39 per cent unemployment.

Yet the city’s tunnel industry also employed thousands of people who helped buoy not only the city’s businesses and nightlife but also the territory’s 1.8 million residents.

Now, once busy restaurants are empty, real estate prices have collapsed and scores of businesses have shuttered.

“We’ve sold only one car in the last eight months,” said Mohammed Arjeh, 25, a salesman at the Rafah Showroom.

A year ago, they were selling four Hyundai Sonatas every month, he said.

For years, tunnels had been a fixture for Rafah’s more than 70,000 residents. Spanning as long as 700 metres, they brought in an estimated $700 million in contraband from Egypt when Israel still directly controlled Gaza.

Israel withdrew in 2005 and then two years later, the territory was taken over by Hamas, which Israel, the United States and Europe classify as a terrorist group. In response, Israel imposed a blockade that severely restricted the movement of goods and people in and out of Gaza.

That closure was a boon to Rafah’s tunnel industry, which Hamas effectively legalised, and taxed, to help keep Gaza’s economy afloat. According to some estimates, the tunnels supplied as much as three-quarters of all goods in the territory. They also provided militants with the means to procure foreign-supplied rockets to strike Israel.

Residents say that subterranean windfall transformed Rafah from an agricultural backwater into a bustling city.

“I would walk to my parents’ house and see new cars being sold down the street and new restaurants and I thought: what I wouldn’t give to drive in a new car!” said Sabarin Framoui, 30, a mother of six who has lived in the city her entire life. “I couldn’t even afford the one shekel it would cost to take a shared taxi at the time.”

Farmers sold off land to pay the tens of thousands of dollars required to build and operate a tunnel, she said, while street vendors who sold felafel opened large restaurants to feed the droves of workers who came from across Gaza to man the tunnels.

She recalled how the new-found wealth drove wedges between residents, with the nouveau riche becoming “snobs, like city people, not villagers like us”.

Still, her family could get by with the $5 a day her husband earned from loading bags of concrete from the tunnels onto lorries for shipment across territory.

After the Egyptian military removed Mohammed Morsi, an Islamist and member of the Muslim Brotherhood, as president in July, Cairo’s interim government almost immediately began destroying tunnels. The Egyptian government accuses Hamas, ideological cousins of the Brotherhood, of fuelling unrest in North Sinai since Mr Morsi’s removal.

The destruction of the tunnels has caused severe shortages in cooking and transportation fuels, exacerbated already chronic electricity shortages and has forced Gazans to rely on far more expensive goods, such as fuel, food and building material, brought in from Israel, which has eased some restrictions in recent years. Now that tunnel work is no longer available, Mrs Framoui and her husband struggle to feed their children. “We’re desperate,” she said.

With a major source of revenue lost, Hamas tax collectors have turned to threats, businessmen say, and have begun asking for seemingly arbitrary sums of money.

“When we see the tax men, we close our doors and run away,” said Khaled Abu Samhadana, 22, who works at a small repair shop for refrigerators and air conditioners on Palestine Bank Street.

Maneer Aashar, 34, and his brothers bought land in Rafah six years ago and began building three villas with two swimming pools using the money from their tunnels, which they used to bring vehicles into Gaza.

Last week, only one of the terracotta mansions stood complete. One of the pools is filled with green sludge.

“Business is very bad these days,” he said.

Others in Rafah pulled out of the tunnel business at the right time. Emad Al Sha’r, 44, who said his wealth surpassed $500,000, is comfortable on his ranch with a horse and orange groves. He co-owned four tunnels and had another all for himself that brought in construction material.

“The people who lost everything, they just didn’t know how the read the political situation,” he said.

For Gazans like Abu Mohammed, the days of living the good life have returned to dreaming about a better one.

“Before the tunnels, all we had in Rafah was the beach and coffee shops for fun. It was boring,” he said.

“After the tunnels, all we have is the beach and the coffee shops. There’s nothing fancy for us anymore. The tunnels are a curse.”