Cash is scarce in Gaza. Palestinians are paying a high price to get it
With nearly every bank branch and ATM inoperable, people have become reliant on an unrestrained network of powerful cash brokers to get money for daily expenses — and commissions on those transactions have soared to about 40%.
'The people are crying blood because of this,' said Ayman al-Dahdouh, a school director living in Gaza City. 'It's suffocating us, starving us.'
At a time of surging inflation, high unemployment and dwindling savings, the scarcity of cash has magnified the financial squeeze on families — some of whom have begun to sell their possessions to buy essential goods.
The cash that is available has even lost some of its luster. Palestinians use the Israeli currency, the shekel, for most transactions. Yet with Israel no longer resupplying the territory with newly printed bank notes, merchants are increasingly reluctant to accept frayed bills.
Gaza's punishing cash crunch has several root causes, experts say.
To curtail Hamas' ability to purchase weapons and pay its fighters, Israel stopped allowing cash to enter Gaza at the start of the war. Around the same time, many wealthy families in Gaza withdrew their money from banks and then fled the territory. And rising fears about Gaza's financial system prompted foreign businesses selling goods into the territory to demand cash payments.
As Gaza's money supply dwindled and civilians' desperation mounted, cash brokers' commissions — around 5% at the start of the war — skyrocketed.
Someone needing cash transfers money electronically to a broker and moments later is handed a fraction of that amount in bills. Many brokers openly advertise their services, while others are more secretive. Some grocers and retailers have also begun exchanging cash for their customers.
'If I need $60, I need to transfer $100,' said Mohammed Basheer al-Farra, who lives in southern Gaza after being displaced from Khan Younis. 'This is the only way we can buy essentials, like flour and sugar. We lose nearly half of our money just to be able to spend it.'
In 2024, inflation in Gaza surged by 230%, according to the World Bank. It dropped slightly during the ceasefire that began in January, only to shoot up again after Israel backed out of the truce in March.
Cash touches every aspect of life in Gaza
About 80% of people in Gaza were unemployed at the end of 2024, according to the World Bank, and the figure is likely higher now. Those with jobs are mostly paid by direct deposits into their bank accounts.
But 'when you want to buy vegetables, food, water, medication -- if you want to take transportation, or you need a blanket, or anything — you must use cash,' al-Dahdouh said.
Shahid Ajjour's family has been living off of savings for two years after the pharmacy and another business they owned were ruined by the war.
'We had to sell everything just to get cash,' said Ajjour, who sold her gold to buy flour and canned beans. The family of eight spends the equivalent of $12 every two days on flour; before the war, that cost less than $4.
Sugar is very expensive, costing the equivalent of $80-$100 per kilogram (2.2 pounds), multiple people said; before the war, that cost less than $2.
Gasoline is about $25 a liter, or roughly $95 a gallon, when paying the lower, cash price.
Bills are worn and unusable
The bills in Gaza are tattered after 21 months of war.
Money is so fragile, it feels as if it is going to melt in your hands, said Mohammed al-Awini, who lives in a tent camp in southern Gaza.
Small business owners said they were under pressure to ask customers for undamaged cash because their suppliers demand pristine bills from them.
Thaeir Suhwayl, a flour merchant in Deir al-Balah, said his suppliers recently demanded he pay them only with brand new 200-shekel ($60) bank notes, which he said are rare. Most civilians pay him with 20-shekel ($6) notes that are often in poor condition.
On a recent visit to the market, Ajjour transferred the shekel equivalent of around $100 to a cash broker and received around $50 in return. But when she tried to buy some household supplies from a merchant, she was turned away because the bills weren't in good condition.
'So the worth of your $50 is zero in the end,' she said.
This problem has given rise to a new business in Gaza: money repair. It costs between 3 and 10 shekels ($1-$3) to mend old bank notes. But even cash repaired with tape or other means is sometimes rejected.
People are at the mercy of cash brokers
After most of the banks closed in the early days of the war, those with large reserves of cash suddenly had immense power.
'People are at their mercy,' said Mahmoud Aqel, who has been displaced from his home in southern Gaza. 'No one can stop them.'
The war makes it impossible to regulate market prices and exchange rates, said Dalia Alazzeh, an expert in finance and accounting at the University of the West of Scotland. 'Nobody can physically monitor what's happening,' Alazzeh said.
A year ago, the Palestine Monetary Authority, the equivalent of a central bank for Gaza and the West Bank, sought to ease the crisis by introducing a digital payment system known as Iburaq. It attracted half a million users, or a quarter of the population, according to the World Bank, but was ultimately undermined by merchants insisting on cash.
Israel sought to ramp up financial pressure on Hamas earlier this year by tightening the distribution of humanitarian aid, which it said was routinely siphoned off by militants and then resold.
Experts said it is unclear if the cash brokers' activities benefit Hamas, as some Israeli analysts claim.
The war has made it more difficult to determine who is behind all sorts of economic activity in the territory, said Omar Shabaan, director of Palthink for Strategic Studies, a Gaza-based think tank.
'It's a dark place now. You don't know who is bringing cigarettes into Gaza," he said, giving just one example. "It's like a mafia.'
These same deep-pocketed traders are likely the ones running cash brokerages, and selling basic foodstuffs, he said. 'They benefit by imposing these commissions,' he said.
Once families run out of cash, they are forced to turn to humanitarian aid.
Al-Farra said that is what prompted him to begin seeking food at an aid distribution center, where it is common for Palestinians to jostle over one other for sacks of flour and boxes of pasta.
'This is the only way I can feed my family,' he said.
___
Kullab reported from Jerusalem.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Hill
16 minutes ago
- The Hill
Work begins in Finland on a new Canadian icebreaker for Arctic defense
HELSINKI, Finland (AP) — Dignitaries at a steel-cutting ceremony Wednesday in Finland marked the start of work on a new Canadian icebreaker to be named the Polar Max and aimed at bolstering Arctic defense. The event marked the concrete beginning of a trilateral partnership of the United States, Canada and Finland announced by the White House in July 2024 to bolster defenses in a region where Russia has been increasingly active. Russia has vastly more icebreaker ships than the U.S. and Canada at a time when climate change has made the remote but strategically important Arctic more accessible. The Icebreaker Collaboration Effort, or ICE Pact, aims to leverage Finland's advanced shipbuilding expertise and technologies to help meet U.S. and Canadian demand for new icebreakers. Canada's minister for defense procurement, Stephen Fuhr, said his country is bringing its coast guard into the military and that investing in the Arctic is important for the future. 'The North is opening up, there are many reasons to be up there,' Fuhr said. 'There's security issues, resource development.' The hull will be built at Helsinki Shipyard before being transported to Canada where it's expected to be completed in Levis, Quebec by 2030. Quebec's Economy Minister Christopher Skeete highlighted the benefits of cooperating on the building of the new icebreaker. 'It's a partnership and we have a shared responsibility for the North, so this is a unique and very opportune partnership that allows us to leverage the strengths of both our countries in terms of maritime Arctic protection,' he said. 'The North is becoming more and more accessible, there are more and more rivalries in the North, and so we have to be prepared to assert our sovereignty out there,' Skeete added. During a NATO summit in June, U.S. President Donald Trump said Finland was the 'king of icebreakers' and suggested the U.S. might be willing to buy as many as 15 of them, including the used icebreaker that Trump said might be immediately available. 'We're trying to make a good deal,' Trump said. According to a U.S. Government Accountability Office report, the U.S. hasn't built a heavy polar icebreaker in almost 50 years. The last remaining one in service is the 399-foot Coast Guard Cutter Polar Star commissioned in 1976. During a talk in February at the RAND research organization, U.S. Coast Guard Vice Admiral Peter Gautier said the agency has determined it needs eight to nine icebreakers — a mix of heavy polar security cutters and medium Arctic security cutters. Building an icebreaker can be challenging because it has to be able to withstand the brutal crashing through ice that can be as thick as 21 feet (6.4 meters) and wildly varying sea and air temperatures, the report said.
Yahoo
an hour ago
- Yahoo
China rushes to build out solar, and emissions edge downward
Climate China Solar TALATAN, China (AP) — High on the Tibetan plateau, Chinese government officials last month showed off what they say will be the world's largest solar farm when completed — 610 square kilometers (235 square miles), the size of the American city of Chicago. China has been installing solar panels at a blistering pace, far faster than anywhere else in the world, and the investment is starting to pay off. A study released Thursday found that the country's carbon emissions edged down 1% in the first six months of the year compared to a year earlier, extending a trend that began in March 2024. The good news is China's carbon emissions may have peaked well ahead of a government target of doing so before 2030. But China, the world's biggest emitter of greenhouse gases, will need to bring them down much more sharply to play its part in slowing global climate change. For China to reach its declared goal of carbon neutrality by 2060, emissions would need to fall 3% on average over the next 35 years, said Lauri Myllyvirta, the Finland-based author of the study and lead analyst at the Centre for Research on Energy and Clean Air. 'China needs to get to that 3% territory as soon as possible,' he said. China's emissions have fallen even as it uses more electricity China's emissions have fallen before during economic slowdowns. What's different this time is electricity demand is growing — up 3.7% in the first half of this year — but the increase in power from solar, wind and nuclear has easily outpaced that, according to Myllyvirta, who analyzes the most recent data in a study published on the U.K.-based Carbon Brief website. 'We're talking really for the first time about a structural declining trend in China's emissions,' he said. China installed 212 gigawatts of solar capacity in the first six months of the year, more than America's entire capacity of 178 gigawatts as of the end of 2024, the study said. Electricity from solar has overtaken hydropower in China and is poised to surpass wind this year to become the country's largest source of clean energy. Some 51 gigawatts of wind power was added from January to June. Li Shuo, the director of the China Climate Hub at the Asia Society Policy Institute in Washington, described the plateauing of China's carbon emissions as a turning point in the effort to combat climate change. 'This is a moment of global significance, offering a rare glimmer of hope in an otherwise bleak climate landscape,' he wrote in an email response. It also shows that a country can cut emissions while still growing economically, he said. But Li cautioned that China's heavy reliance on coal remains a serious threat to progress on climate and said the economy needs to shift to less resource-intensive sectors. 'There's still a long road ahead,' he said. One solar farm can power 5 million households A seemingly endless expanse of solar panels stretches toward the horizon on the Tibetan plateau. White two-story buildings rise above them at regular intervals. Sheep graze on the scrubby vegetation that grows under them. Solar panels have been installed on about two-thirds of the land. When completed, it will have more than 7 million panels and be capable of generating enough power for 5 million households. Like many of China's solar and wind farms, it was built in the relatively sparsely populated west. A major challenge is getting electricity to the population centers and factories in China's east. 'The distribution of green energy resources is perfectly misaligned with the current industrial distribution of our country,' Zhang Jinming, the vice governor of Qinghai province, told journalists on a government-organized tour. Part of the solution is building transmission lines traversing the country. One connects Qinghai to Henan province. Two more are planned, including one to Guangdong province in the southeast, almost at the opposite corner of the country. Making full use of the power is hindered by the relatively inflexible way that China's electricity grid is managed, tailored to the steady output of coal plants rather than more variable and less predictable wind and solar, Myllyvirta said. 'This is an issue that the policymakers have recognized and are trying to manage, but it does require big changes to the way coal-fired power plants operate and big changes to the way the transmission network operates,' he said. 'So it's no small task.' ___ Moritsugu reported from Beijing. Associated Press video producer Wayne Zhang contributed. ___ The Associated Press' climate and environmental coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP's standards for working with philanthropies, a list of supporters and funded coverage areas at
Yahoo
2 hours ago
- Yahoo
China rushes to build out solar, and emissions edge downward
TALATAN, China (AP) — High on the Tibetan plateau, Chinese government officials last month showed off what they say will be the world's largest solar farm when completed — 610 square kilometers (235 square miles), the size of the American city of Chicago. China has been installing solar panels at a blistering pace, far faster than anywhere else in the world, and the investment is starting to pay off. A study released Thursday found that the country's carbon emissions edged down 1% in the first six months of the year compared to a year earlier, extending a trend that began in March 2024. The good news is China's carbon emissions may have peaked well ahead of a government target of doing so before 2030. But China, the world's biggest emitter of greenhouse gases, will need to bring them down much more sharply to play its part in slowing global climate change. For China to reach its declared goal of carbon neutrality by 2060, emissions would need to fall 3% on average over the next 35 years, said Lauri Myllyvirta, the Finland-based author of the study and lead analyst at the Centre for Research on Energy and Clean Air. 'China needs to get to that 3% territory as soon as possible,' he said. China's emissions have fallen even as it uses more electricity China's emissions have fallen before during economic slowdowns. What's different this time is electricity demand is growing — up 3.7% in the first half of this year — but the increase in power from solar, wind and nuclear has easily outpaced that, according to Myllyvirta, who analyzes the most recent data in a study published on the U.K.-based Carbon Brief website. 'We're talking really for the first time about a structural declining trend in China's emissions,' he said. China installed 212 gigawatts of solar capacity in the first six months of the year, more than America's entire capacity of 178 gigawatts as of the end of 2024, the study said. Electricity from solar has overtaken hydropower in China and is poised to surpass wind this year to become the country's largest source of clean energy. Some 51 gigawatts of wind power was added from January to June. Li Shuo, the director of the China Climate Hub at the Asia Society Policy Institute in Washington, described the plateauing of China's carbon emissions as a turning point in the effort to combat climate change. 'This is a moment of global significance, offering a rare glimmer of hope in an otherwise bleak climate landscape,' he wrote in an email response. It also shows that a country can cut emissions while still growing economically, he said. But Li cautioned that China's heavy reliance on coal remains a serious threat to progress on climate and said the economy needs to shift to less resource-intensive sectors. 'There's still a long road ahead,' he said. One solar farm can power 5 million households A seemingly endless expanse of solar panels stretches toward the horizon on the Tibetan plateau. White two-story buildings rise above them at regular intervals. Sheep graze on the scrubby vegetation that grows under them. Solar panels have been installed on about two-thirds of the land. When completed, it will have more than 7 million panels and be capable of generating enough power for 5 million households. Like many of China's solar and wind farms, it was built in the relatively sparsely populated west. A major challenge is getting electricity to the population centers and factories in China's east. 'The distribution of green energy resources is perfectly misaligned with the current industrial distribution of our country,' Zhang Jinming, the vice governor of Qinghai province, told journalists on a government-organized tour. Part of the solution is building transmission lines traversing the country. One connects Qinghai to Henan province. Two more are planned, including one to Guangdong province in the southeast, almost at the opposite corner of the country. Making full use of the power is hindered by the relatively inflexible way that China's electricity grid is managed, tailored to the steady output of coal plants rather than more variable and less predictable wind and solar, Myllyvirta said. 'This is an issue that the policymakers have recognized and are trying to manage, but it does require big changes to the way coal-fired power plants operate and big changes to the way the transmission network operates,' he said. 'So it's no small task.' ___ Moritsugu reported from Beijing. Associated Press video producer Wayne Zhang contributed. ___ The Associated Press' climate and environmental coverage receives financial support from multiple private foundations. AP is solely responsible for all content. Find AP's standards for working with philanthropies, a list of supporters and funded coverage areas at Ken Moritsugu And Ng Han Guan, The Associated Press
