Single cigarette costs $20 in Gaza as prices for basic goods spiral

Prices for basic goods in the Gaza Strip have spiralled after the closure of its border crossing with Egypt worsened wartime scarcity, sending the cost of a single cigarette as high as $20 and forcing families to sell jewellery and other possessions to buy food.

Vegetables, frozen meat, medication, petrol and cooking fuel have leapt in price to at least triple their prewar levels. Some items now cost dozens of times what they did before Israel’s war with Hamas began, according to information collected by the Financial Times over the past week from the few markets that are still operating in southern Gaza.

The outbreak of war in October sharply constrained the flow of goods into Gaza, but the situation worsened last month after Israel’s military launched an offensive into the southern Gazan city of Rafah, seizing a key border crossing with Egypt and targeting a network of smuggling tunnels.

A kilo of frozen chicken thighs, only available once or twice a week, has leapt to the equivalent in Israeli shekels of $20, more than 10 times its prewar price. Cooking gas, when available, costs $35 a kilo, up from $1.60; car batteries, used for charging phones and electric lamps, sell for more than $500 each; and a litre of petrol, when available, sells for $22.

Solar panels can only be bought on the black market. Shisha tobacco costs $50 for enough for a single pipe or $2,500 for a kilo, while the asking price for one Egyptian Karelia brand cigarette peaked at $140 earlier this year and is at present about $20.

These are ruinous prices even for the few who can afford them. Per capita income in Gaza before the war, when almost half the population was unemployed because of the Israeli blockade, was about $1,200 a year, according to the World Bank.

By February, 90 per cent of Gazans were unemployed, according to estimates by the Palestinian Central Bureau of Statistics, as the enclave’s GDP fell more than 80 per cent.

The conflict, forced displacement and unemployment have exhausted the savings of even middle-class Gazans, while most survive on scarce humanitarian aid. The few functioning cash machines have two-day queues.

Some families are being forced to leave their identification documents as security at shops as they run out of cash, “putting their own safety and future in jeopardy because they need those identification cards to register for aid in the future”, the UN said this month.

Ahmed Abdelhay, the 52-year-old patriarch of a large family displaced to Deir al Balah in central Gaza after the Israeli army destroyed their home in the north, was forced to sell two of his wife’s gold bracelets for $4,000.

That was barely enough to buy frozen chicken, canned food, firewood and summer clothes for the adults and children. He is preparing to sell the last of the family’s gold to buy more food.

“Staying alive is so expensive,” he said.

Prices in Gaza fluctuate depending on how many trucks of commercial goods enter. If trucks carrying fresh vegetables arrive, shopkeepers drop their prices for the day.

After Israel seized the Gaza side of the Rafah crossing last month, the Egyptian government halted the flow of aid into the besieged enclave in protest. It recently resumed supplies under pressure from Washington, but the Rafah border crossing itself remains closed.

Northern Gaza is “likely” to be in the grip of famine, and the “Israeli military offensive in Rafah [is] seriously disrupting food distribution channels and worsening access to food” in southern Gaza, the US-funded Famine Early Warning Systems Network said this week.

As of Friday morning, more than 1,000 trucks’ worth of aid was sitting on the Gazan side of two crossings from Israel awaiting dispersal.

Distribution has been hampered by the fighting, fuel scarcity and the breakdown of law and order. The backlog has cut the number of trucks able to enter the strip, according to Israeli military data.

“Things have become nastier as the situation grows increasingly desperate, the Bedouin clans are more ruthless than ever before [with the looting of convoys]. It’s still Mad Max,” said a person familiar with Gaza humanitarian issues.

Soaring profits from the high prices have resulted in local, Egyptian and West Bank-based Palestinian businessmen seeking to get more commercial trucks into Gaza. Two people familiar with the situation said there was a period last month in which commercial goods made up a large portion of incoming convoys.

Palestinian businesspeople can pay exponentially more for truck hire than aid groups, they said. Commercial operations, bringing items such as soft drinks and cigarettes, pay as much as $2,500 per truck for armed local security, something international aid groups are barred from doing.

Businessmen are “competing with international aid groups” to get goods in, one person said. “The focus has been on counting trucks [going into Gaza]. But we have to make sure the right quantity and quality of real aid is getting to the right people [who need it most].”

Cogat, the Israeli military body responsible for civilian affairs in Gaza, said it was “prioritising humanitarian aid”. “We want to get as much aid as possible to the people of Gaza . . . and we’re willing to co-ordinate and facilitate more with the international community,” it said, adding that aid groups’ “logistical capabilities [inside Gaza] need to be greatly increased”.