The author of this report is anonymous for their safety.
RAFAH—Even if you’ve scraped together enough money to bribe your way out of war-torn Gaza before an expected final ground invasion by Israel, your problems aren’t over.
An acute cash shortage across the enclave means people cannot access the money in their own accounts to pay soaring prices for food and fuel, or to hand over large sums to secure their passage through the Rafah crossing and into the safe haven of Egypt.
Heba Ahmed, a 25-year-old resident of Gaza city, currently displaced in Rafah, found herself embroiled in a frustrating battle to get her hands on the cash she had saved to facilitate her evacuation from the Gaza Strip. After three days spent scouring exchange shops in Rafah, she managed to cobble together $8,100 in cash, a process that should have been swift and simple but turned into a grueling ordeal as all of Rafah awaits a feared invasion by Israeli ground forces.
“I received the money from friends outside Gaza through bank transfer but I have to pay it in cash to the coordination agent so he can process coordination with Egyptian authorities for my leave. It is a high cost, but it is the fastest, as it will take one week to leave,” she told The Daily Beast.
Meanwhile, Majdi Adham, a 45-year-old employee of an international humanitarian NGO, faced his own ordeal in accessing his hard-earned salary. Despite his efforts to withdraw his wage from the only ATM in central Rafah without incurring additional fees, he was thwarted, compelling him to resort to black-market channels where he was charged a hefty 10 percent fee just to access his own money.
“I have to send the money from my bank account to this shop owner’s account, so they discount 10 percent of the amount and give me the rest. I’m forced to seek this way to get the cash since two ATMs are operating in the whole of Rafah for only a few hours. That can’t be enough for the crowds of people to get their salaries,” Adham told The Daily Beast.
“It may be forbidden to accrue such interest under Islamic law, but I believe all war traders are exploiting this situation for their own gain. They are driven by greed.”
Adham explained that the percentage taken by black-market cash traders started at 2 percent but over the last two months has increased dramatically to reach 12 percent in some shops due to the liquidity shortage.
The plight of Ahmed and Adham is emblematic of a broader cash crisis gripping Gaza.
The Palestinian Monetary Authority (PMA), which takes the place of a the central bank in managing monetary affairs as Palestinians use the Israeli currency, has been hampered in its efforts to alleviate the crisis. Since the onset of the war, restrictions have prevented the PMA from sending new cash in shekels, dollars or Jordanian dinars into the Gaza Strip, further compounding the scarcity of funds.
A source at the PMA, who spoke on condition of anonymity, identified several factors contributing to this crisis, including the substantial outflow of dollars facilitated by travelers passing through the Rafah crossing or via transfer agents, which has drained liquidity from banks. Gaza City is also grappling with a disconnection between markets and customers due to movement restrictions imposed during the conflict, further exacerbating the scarcity of cash. The situation is compounded by the influx of displaced people from Gaza City, putting immense strain on already limited resources.
According to Palestinians inside Gaza City, none of the ATMs are operational, while only a handful operate in the south of Gaza, leaving residents with few viable options to access their funds. Employees of the Palestinian Authority, other international organizations, NGOs, traders, and ordinary citizens all find themselves caught in the same struggle for liquidity in an environment marked by uncertainty and scarcity.
Abdallah Solaiman, 31, a shop owner, says he is furious at the beleaguered authorities for their failure to take control over major traders who are manipulating exchange rates, food prices, and other commodities.
“There’s little oversight over the large traders who wield control over the prices,” he told The Daily Beast. “They belong to influential families acting like a mafia in Rafah, dictating exorbitant prices that only select consumers can afford. At times, we’ve even witnessed violence erupting as people scramble to purchase essentials like chicken that enter rarely through the Rafah crossing.”
Until recently, the Hamas police maintained some semblance of order in the Rafah market through their plainclothes officers. Following the assassination of the head of the Hamas emergency office in the north and east of Rafah, however, their presence has dwindled, allowing traders to once again monopolize prices and exclude the less affluent from accessing basic food items such as sugar, meat, and oil.
Last week The Daily Beast observed a massive demonstration in the Kherbet Al'das neighborhood in eastern Rafah triggered by the increased prices. On the same day, a family dispute closed the main sea road for few hours due to shooting and burning tires. Chaos is escalating in Gaza as local committees come under fire from the Israeli army as well.
In the past week, numerous Mukhtars—traditional clan leaders—were targeted and killed in Rafah, Nussierat, and Gaza City, supposedly for their involvement in the local committees organized by Hamas police to coordinate aid distribution.
Hassan Al-Mughni, head of the Supreme Tribal Committee in the Gaza Strip, told The Daily Beast that local leaders and heads of families cannot take full control of the entire enclave. “All Palestinian tribes refuse to serve as a substitute for the government. Tribes cannot govern a country or replace established government structures and laws. Our mission is to foster social reconciliation, preserve social cohesion, and bolster governmental efforts.”
As law enforcement and local government collapse after nearly six months of bombardment from Israel, there is no one left to monitor price gouging cartels or maintain law and order amid the rubble.
“The tribal committee model ruling Gaza is not viable, as many big families under this system are aligned with or supportive of various Palestinian factions,” Al-Mughni said. “The aid distribution isn’t fair and not satisfying the people needs. We can’t control the distribution or arrest those who sell the aid. Then, we find ourselves caught in the crossfire, facing Israeli attacks.”
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