In recent weeks, the media has reported that Hamas officials had smuggled some US$25 million into Gaza Strip. However, Palestinian sources estimate that the money smuggled in order to break the international financial blockade against the Palestinians is well over US$35 million. Hamas claims it has raised more than $60 million from Islamic and Arab states, while US pressure on international banks has prevented these nations from transferring the money into the Palestinian territories.
In the most recent incident of money smuggling, the Palestinian foreign minister carried six suitcases over the Egyptian border in the Gaza Strip, containing some US$20 million in cash. The money, brought through the UN-monitored Rafah crossing in the Strip, was handed over to the Palestinian Finance Ministry. According to press reports, Foreign Minister Dr. Mahmoud Zahar told security agents he was carrying a large sum of money in order to avoid trouble at the border. The Palestinian minister raised the donations during his recent tour in the Far East, Iran and Egypt.
EU observers monitoring the Gaza Strip’s terminal with Egypt have protested against the border crossing being used by Hamas officials to import money. “I received a very severe letter from the head of the European observer team, Pietro Pistolese, saying it was unacceptable as far as the monitors were concerned that millions of dollars were crossing the terminal,” chief Palestinian negotiator Saeb Erakat told AFP. The money smuggling method has also been criticized by Hamas rival group, Fatah, and its leader, Palestinian President Mahmoud Abbas.
Last month, an attempt by Hamas spokesman Sami Abu Zuhri to smuggle money into the Gaza Strip in suitcases almost led to an armed clashes in Rafah between Hamas members and forces loyal to Abbas. At the time, the Palestinian president also called for an investigation into the smuggling attempt on the part of Abu Zuhri. A source in Abbas' office in the West Bank city of Ramallah said that Abbas ordered the attorney general to launch an investigation into the incident and question Abu Zurhi as to the source of the money.
Sources maintain that the money Abu Zuhri attempted to bring into the Palestinian territories was intended for Hamas, and not the cash-strapped government it leads. Despite Abu Zuhri's protests, the money was eventually directed to the finance ministry. "Since the money reached the government, I believe it went to the intended recipient," he said, contradicting an earlier comment that the money was brought to pay the salaries of Palestinian prisoners held in Israeli jails.
The smuggling incidents have further damaged the Palestinians' image in the West, especially since government officials are carrying them out. Following Zahar's smuggle attempt, Abbas slammed Hamas, saying "Until when will this government continue to smuggle money"? Walid Awad of Abbas' office told Reuters that the move by Zahar had put Abbas in a "dilemma". According to him, Abbas was embarrassed by the incident, which he considered as an "amateurish" way of increasing revenue. It also seems that the Palestinian people are fed up with the situation, believing that the money smuggling efforts are intended to serve narrow political interests rather than helping needy Palestinians. Hours before Zahar entered Gaza, scenes of chaos erupted in Ramallah, with nearly 1000 government workers protesting inside the Hamas-dominated Parliament building over the non-payment of wages. They threw water bottles and other items at Hamas legislators, forcing the parliament speaker to adjourn the session for some 45 minutes. In what was described in the West Bank as the "revolution of hungry people," government workers shouted: "We are hungry! We are hungry!"
Many of the protestors have ceased to believe that the Hamas-led cabinet has no ability to pay salaries since taking control of the Palestinian Authority in March. Many believe that Hamas prefers to first pay its close associates before solving problems of public employees. As money continues to be imported by Hamas officials, Palestinians question the continuing failure of Hamas to pay their salaries. Even Prime Minister Ismail Haniyeh's promise to pay one-month’s salary to low-level workers was fulfilled only after numerous delays. The payment for these employees was estimated at approximately US$13 million, a relatively small sum compared to that smuggled in by Hamas officials. Currently, over 120,000 government employees are still waiting for three-months’ salary.
Many in the Palestinian territories maintain that so far, the Hamas government has been disastrous for the very Palestinians who voted it into power. Some argue that the Palestinians voted for Hamas in protest of Fatah corruption. However, even Fatah managed to make their payroll on a regular basis.
Though many believe that the corruption of Fatah has ceased, a new one has also emerged in its place. Hamas' inner circle enjoys the benefits of smuggled money while the rest of the Palestinians are told to “eat salt and drink water.”