Gaza- “For the first time since the beginning of the war, I am buying a plate of eggs,” says Muhammad Abu Hamid, indicating that the prices of goods and commodities in the Gaza Strip markets have fallen significantly, but they have not reached the normal situation they were in before the outbreak of the Israeli war following the “Al-Aqsa Flood” operation in October 7, 2023.
The price of a plate of eggs (30 eggs) decreased from 120 shekels (one dollar equals 3.7 shekels) to 25 shekels, a few days after the ceasefire agreement between the Islamic Resistance Movement (Hamas) andIsraelThe State of Qatar announced it last Sunday, January 19.
Abu Hamid, an employee in the Hamas-run government in the Gaza Strip, told Al Jazeera Net that 800 shekels per month was not enough to meet the family’s basic needs in light of the extreme high prices.
Abu Hamid (50 years old) supports a family of five people, and lives in a tent in the Mawasi Khan Yunis area after being forcibly displaced from his home in the city of Rafah, south of the Gaza Strip. He was completely destroyed, as were most of the homes in this small city, which was subjected to the longest Israeli ground military operation that lasted. 8 months.
Low prices
Like the majority of Gazans who were exhausted by the war and lost their sources of livelihood, Abu Hamid’s primary dependence was on the aid provided by relief institutions.
Abu Hamid says that this aid was not completely sufficient, due to the restrictions imposed by the occupation authorities on the entry of aid trucks, following the invasion of Rafah and the occupation of the Rafah land crossing with Egypt on May 6 of last year.
From then until the ceasefire agreement was reached, the percentage of trucks entering did not exceed 5% of the humanitarian needs of about two million and 300 thousand Palestinians in the Gaza Strip, the majority of whom were plunged by the war below the poverty line, according to estimates by the United Nations Relief and Works Agency for Palestine Refugees (UNRWA).
The past few days following the agreement witnessed an influx of aid trucks from several ports, most notably the Kerem Shalom crossing, the only commercial crossing with the Gaza Strip, which is under full Israeli control and is located in the far southeast of the Gaza Strip.
According to local and international data, between 600 and about a thousand trucks of humanitarian aid entered the Gaza Strip on a daily basis during the past three days.
Abu Hamid says that this aid reduced prices, but not what they were before the outbreak of war.
The seller, Maher Al-Jourani, praises Abu Hamid’s speech, and tells Al Jazeera Net that prices have fallen significantly and unprecedentedly since the outbreak of war, and as a result the markets have witnessed recovery and active movement, and he believes that they will increase with the passage of time.
Banks and the liquidity crisis
Due to the collapse of the financial sector and the closure of banks and exchange companies, Abu Jihad has not received his monthly salary that he receives from the Palestinian Authority as a wounded man since he suffered an injury that prevents him from working during the Al-Aqsa Intifada in 2000.
Abu Jihad, who preferred not to mention his full name to Al Jazeera Net, hopes that the ceasefire agreement will contribute to the return of banks and exchange companies, so that he can receive his overdue financial dues and pay off his debts, which he accumulated during the war, in order to support his family of 4 individuals.
This collapse caused a liquidity crisis that limited the purchasing power of citizens, and was exploited by what the Gazans describe as “liquidity merchants,” who divided their money between employees and citizens by imposing a percentage that often reached 40% of the value of the amount to be spent.
Abu Jihad says that he received a money transfer of about a thousand dollars as assistance from a relative of his who lives outside Gaza, and he had to transfer it through the electronic banking application of one of the merchants, who disbursed it to him in exchange for a commission that reached 300 dollars. He added with a smile, “It was a lower percentage than the market because I resorted to him.” From a mutual friend.
Economic outlook
The expert specializing in economic affairs, Ahmed Abu Qamar, explains what happened in the markets after the ceasefire agreement, and tells Al Jazeera Net that what is more important than the introduction of aid trucks is that the citizen found himself in a state of calm, as he no longer felt fear that would require him to purchase goods that exceed his needs, such as the possibility of returning. Famine, and thus being satisfied with purchasing necessities in reasonable quantities.
He adds that the flow of aid and the state of reassurance among citizens contributed to reducing prices through the availability of quantities of goods and goods, and the beginning of the markets gradually returning to the state they were in before the outbreak of war.
In terms of numbers, Abu Qamar told Al Jazeera Net: Before the outbreak of the war, 350 to 400 trucks entered the Gaza Strip, and during the months of the war no more than 50 trucks entered the Gaza Strip only to the north and south of the Gaza Strip due to Israeli restrictions.
He continues, “The ceasefire agreement and the return of trucks to their pre-war levels, for example, is a breakthrough for the Gazans who have lived through the scourge of war, siege, and famine.”
Abu Qamar also attributed the drop in prices to merchants ceasing to have a monopoly following the influx of more goods and merchandise under the agreement.
However, Abu Qamar warned against the policy of dumping and studying the population’s need to ensure that prices do not collapse. He said that currently the northern Gaza Strip is witnessing a dumping of flour, which has led to the price of a bag weighing 25 kilograms falling to 5 shekels after it had reached more than two thousand shekels in previous months.
The economic expert warns that the dumping policy is sometimes intended by the occupation, such that markets are flooded with a certain type and other types are prohibited.
He also called for the urgent need to bring caravans, tents, batteries, solar energy, and kitchen utensils, and this requires donor institutions to know the needs of citizens.
Despite the change that has occurred in the markets – Abu Qamar adds – the economic situation in Gaza is not stable in light of talk about multiple stages of the ceasefire agreement.
As for commercial and financial life, the economic expert expected it to witness a recovery in the coming period, especially if the reconstruction process of the sector begins. The expert stressed the importance of providing qualified crossings for the entry of goods and materials without control by the occupation.
The recovery of commercial activity would directly lead to a decrease in unemployment rates, which rose to more than 90% during the war, and the revival of the construction, contracting, and infrastructure sectors, in addition to the return of local factories to work, according to Abu Qamar.
