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Gaza economy loses $230 million due to tunnel closures

July 23, 2013 1:41 P.M. (Updated: Aug. 14, 2013 1:55 P.M.)
GAZA CITY (Ma'an) -- The economy of the Gaza Strip lost an estimated $230 million in June due to the closure of smuggling tunnels by Egyptian authorities, Gaza's minister of economy said Tuesday.

Over 20,000 people have lost their jobs in the construction industry as a result of shortages in raw materials which usually arrive through the network of smuggling tunnels under the Gaza-Egypt border, minister of economy Alaa Rafati told Ma'an.

"The siege Israel imposed on Gaza is still in effect, though it was loosened at a certain point thanks to the tunnels," Rafati said.

Nearly 90 percent of projects funded by Qatar and Turkey have been suspended due to a lack of supplies to Gaza since June 15.

Supplies allowed through by Israel via the Kerem Shalom crossing only cover around 30 percent of the population's needs, Rafati said.

"We don't oppose closing the tunnels, but an alternative must be found first, which is opening the Rafah crossing for the entry of goods."

Egypt has destroyed dozens of tunnels since last August following the killing of 16 Egyptian soldiers in a militant attack near the Gaza fence.

Political unrest in the country and security measures in the Sinai peninsula have also caused a large slowdown in the tunnel trade, which has severely damaged Gaza's construction industry.

Egypt abruptly closed the Rafah terminal for five days in June after a rise in militant attacks in Sinai following the army's ouster of Islamist President Mohamed Mursi. It partially reopened the border on June 10.

At one stage an estimated 2,500-3,000 tunnels snaked their way under the desert fence but the network has shrunk markedly since 2010, when Israel eased some of the limits they imposed on imports into the coastal enclave.
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