OVER 200 GAZA BUSINESSMEN LAMENT DELAYS AT KARNI

C O N F I D E N T I A L TEL AVIV 002164

SIPDIS

NEA FOR SATTERFIELD

E.O. 12958: DECL: 04/12/2006
TAGS: KWBG ECON GZ IS PTER ISRAELI PALESTINIAN AFFAIRS GAZA DISENGAGEMENT
SUBJECT: OVER 200 GAZA BUSINESSMEN LAMENT DELAYS AT KARNI
CROSSING AND URGE "ACTIVISTS" NOT TO TARGET COMMERCIAL
FACILITIES


Classified By: Economic Counselor Ted Mann per 1.4 b and d


1. (C) Embassy sources reported that over 200 Gazan
businessmen attended a Chambers of Commerce meeting on April
13 in Gaza City. They attributed the large turnout to the
seriousness of the problems facing businessmen caused by
delays at Karni crossing. (Karni is the only commercial
crossing serving the Gaza Strip). Although Karni is
technically open, businessmen report that processing has been
at a snail's pace for more than two weeks. According to one
source, trucks are waiting at the crossing for over seven
days to make a delivery as opposed to the customary 24-48
hours. These delays have caused transportation costs to
increase seven fold from an average of USD 230 per truckload
to USD 1590. Mohammed Yazeji, Seven-Up distributor, reported
that his inability to receive inputs for over ten days has
forced him to send 80 laborers "on vacation." Yazeji
reported that many Gazan businessmen were facing similar
circumstances.


2. (C) Yazeji reported that businessmen were running out of
ideas. He said businessmen had already written to PA
Minister of National Economy Maher el Masri; appealed to Gaza
security head Mohammed Dahlan; and sent emissaries to "all
the groups" asking them not to "make actions" near commercial
crossings/interests -- all to no avail. According to Yazeji,
at the April 13 Chambers of Commerce meeting, businessmen
decided to use the press to appeal to the GOI to restore full
operations at Karni crossing and to tell the international
community that Karni should be closed altogether if the GOI
planned to only allow it to continue operating in drips and
drabs. Yazeji acknowledged that a complete closure would not
help the cause, but said the private sector was grasping for
ways to sensitize the international community to its plight.


3. (C) Comment: Time and time again, the Palestinian
private sector has borne the brunt of terrorist acts and the
resulting Israeli security crackdown and closure. The GOI
all but froze activity at Karni after terrorists stowed away
in an empty container transiting the crossing and carried out
the March 14 bombing at Ashdod port which killed ten
Israelis. The relief/donor community reacted quickly to this
closure, issued international press releases, mobilized the
UN and saw access for its humanitarian goods restored
relatively quickly. Normal operations were not/not, however,
restored for the private sector. With no lobbying ability
comparable to that of the international relief community and
an apparent inability to dissuade militants from targeting
commercial facilities/infrastructure, the private sector is
truly caught in the middle. A significant infrastructure
upgrade that would improve security and still allow for the
expeditious processing of goods is perhaps the most practical
solution in the near term. While such an upgrade has been
discussed, no decisions have been taken by Israel, the
Palestinians, or the donor community on what such an upgrade
would entail and how it would be financed.

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