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Report: 13-fold increase in Hamas budget since 2005

April 23, 2011 11:58 A.M. (Updated: April 24, 2011 9:49 A.M.)
TEL AVIV, Israel (Ma'an) -- The budget of the Hamas movement is 13 times bigger since Israeli forces unilaterally withdrew from the Gaza Strip in 2005, according to the Israeli newspaper Maariv.

The Hebrew-language daily reported Friday that the Islamist party's annual budget has grown from $40 million to $540 million over the six-year period, despite Israel's illegal siege imposed in 2007.

According to Maariv, the revenue comes from taxes on tunnel operators, the Palestinian Authority and bribes from businessmen.

Taxes collected from tunnel operators bringing in goods from Egypt accounted for 14 percent of Hamas' income, the report said.

Maariv reported that Palestinian banks transferred $1.8 billion to Gaza each year. Most of that was from the PA, which channeled $1.1 billion annually into the coastal enclave.

The newspaper said the PA spent $500 million each year to cover 77,000 civil servants' salaries and pensions in Gaza. The PA also paid for public sector institutions including the Ministry of Health and for fuel and domestic gas bought from Israel, Maariv reported.

Additionally Hamas allowed businessmen to work freely in the Gaza Strip in exchange for a percentage of their profits, the report said.

The newspaper said Hamas had consolidated its control of the territory, paying the salaries of 40,000 Gaza residents including 21,000 militants and 11,000 police officers. Maariv said statements by Gaza premier Ismail Haniyeh revealed that his government spent $250 million on salaries each year.

The party also controlled all municipal councils and ministries, allowing it to minimize expenses and direct more money to its own budget, the newspaper said.

Maariv reported that Hamas spent $30 million in East Jerusalem and the West Bank each year, but said it was not clear how the movement transferred the money to PA-controlled territory.

The newspaper also accused the Islamist movement of using international aid "creatively."

A clear assessment of the economic situation was unattainable as it was difficult to assess Hamas' income from around 400 smuggling tunnels, Maariv noted.

Meanwhile most official reports discuss the West Bank and Gaza together, and cover only official transactions, the newspaper said.

Maariv reported that Hamas retained some of its budget in the Gaza Strip to pay salaries, but most funds were kept in banks in Iran and Europe.

The newspaper cited a report by the International Monetary Fund which said Gross Domestic Product rose by 15 percent in Gaza in 2010.

However, the IMF report warned against misreading the apparent growth in Gaza.

"While Gaza's growth in 2010 may appear impressive, much of it represents a 'catch-up' of real GDP following its contraction by a cumulative 30 percent during 2006–09 due to the blockade.

"In 2010, even following the surge in output, Gaza's real GDP was 20 percent below its 2005 level."

The growth would not be sustained unless Israel eased its blockade on the coastal enclave and lifted the ban on exports, the IMF report added.

The IMF also noted especially bleak employment prospects for youth in Gaza, where rates of youth unemployment stood at 53 percent.
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