GAZA CITY: Three out of four factories in Gaza have closed because they can't import or export.
Legitimate businesses have been replaced by a Hamas-controlled black market economy. Millions of gallons of sewage are pumped into the sea every day because a lack of spare parts holds up infrastructure repairs.
Three years after Israel and Egypt sealed Gaza in hopes of squeezing the territory's Hamas rulers, those suffering most are ordinary Gazans. They include tens of thousands who lost their jobs, among them 49-year-year old Mohammed Maadi whose family of 15 scrapes by on UN rations and whose teenage sons risk their lives digging smuggling tunnels to help put food on the table.
Even if the blockade were to be lifted soon — as many demanded after last week's deadly Israeli raid on a blockade-busting flotilla — recovery could take years.
Production lines have fallen into disrepair. Entrepreneurs have moved investments abroad. Men forced into idleness have lost their place in society.
Gaza was "working poor" before, but economists say the blockade closed off any chance of development. "We have been transformed from a productive society into one dependent on handouts," said economist Mohsin Abu Ramadan.
Israel says economic sanctions are a legitimate tool against Hamas, branded a terror group by the West. Hamas critics say Gaza's borders could be opened if Hamas renounce violence and recognize Israel.
Instead, Hamas has clung to its hard-line positions, and the standoff seemed intractable — until last week, when Israel's sea raid trained world attention on Gaza's plight.
US President Barack Obama said this week that Gaza's situation is unsustainable and that everything except weapons should be let in. For now, Israel only allows in a few dozen types of goods, such as potato chips, frozen meats and medicines, but bans raw materials, including construction supplies, and virtually all exports.
As a result, more than 70 percent of Gaza's 3,900 factories are closed or operating at minimal capacity.
Eighty percent of Gazans receive humanitarian aid, up from 63 percent in 2006, the UN says.
Some 300,000 have no income at all, a threefold increase over the course of a year.
Delays in bringing in spare parts have held up repairs of a dilapidated, overburdened infrastructure. Electricity is cut for hours a day in rolling blackouts, and millions of gallons of untreated or partially treated sewage have to be pumped into the Mediterranean every day.
Gaza's health service is overwhelmed and advanced care, including cancer treatment, is not available, forcing thousands every year to seek treatment abroad, including in Israel.
Israel issues special permits for patients, but some are turned down and others face delays. Newborn Mohammed Hajaj died of congenital heart disease on March 5, two days after his appointment with a Jerusalem specialist and two days before his Israeli entry permit arrived, said Mohammed Daher of the World Health Organization.
Israel allows in medical equipment, but delivery is slow, said Chris Gunness, a spokesman for Gaza's main UN aid agency. Hundreds of items, including CT scanners, X-ray machines and spare parts for lab equipment have been waiting to get into Gaza for up to a year, he said.
Almost every household seems to have been touched by the blockade.
Maadi, the jobless father of 13, said Israel stripped him of his work permit in January 2006 when Hamas won parliamentary elections in the West Bank and Gaza. Hamas' ascent to power — starting with that election victory and continuing with the capture of an Israeli soldier by Gaza fighters later that year — marked the start of increasingly tighter restrictions, leading to a full closure after the group seized the territory in 2007.
Maadi was one of tens of thousands of Gazan day laborers in Israel used to make $40 a day as a construction worker, enough to provide for his family. Now the Maadis barely survive on UN food rations of flour, rice, oil, sugar and powdered milk, supplemented by occasional gifts from relatives.
Maadi's wife, Hannan, 44, said she is worried her children aren't getting enough nutrients. Four are anemic, she said, listing each child's hemoglobin level.
In a bid to help the family, two of the Maadi boys, 18-year-old Mahmoud and 19-year-old Hussam, briefly worked in the smuggling tunnels under the border with Egypt. Hussam was terrified, but overcame his fear of his damp, dark work place because he and his brother each made $25 a day.
A month into the job, Hussam's tunnel collapsed, burying him to his neck before he was rescued. The Maadis told their sons to quit, saying the money wasn't worth the risk of losing them. Dozens have died in tunnel collapses, and Israel also bombs the tunnels from time to time.
Gaza's unemployment was around 39 percent at the end of 2009, but dropped by about five percentage points in the first quarter of 2010, apparently because Hamas hired thousands more civil servants.
