Gaza Herald — So-called “coordination fees” imposed on the entry of goods into the Gaza Strip have become an unprecedented financial burden on traders and the private sector, with business leaders warning that the system has drained billions of dollars from Gaza’s economy while driving up prices for ordinary Palestinians.
The Gaza Chamber of Commerce, Industry and Agriculture says documented field data indicate that traders and businesses have paid more than $2 billion under what are described as “security coordination” charges, unofficial fees, and arbitrary administrative requirements imposed at border crossings throughout the blockade and the ongoing war.
Hossam al-Huwaiti, a member of the Chamber’s board of directors, said the financial burden represents an unlawful drain on Gaza’s economy.
“The added costs have directly increased the prices of essential goods, raw materials, and construction supplies,” al-Huwaiti told Filastin newspaper. “Ultimately, these costs are passed on to consumers while weakening the ability of local businesses to compete and survive.”
He said the coordination system has turned supply chains into costly and inefficient operations that serve neither humanitarian nor economic purposes.
“These charges are not based on any recognized customs or legal framework,” he said. “They are imposed selectively and arbitrarily.”
According to al-Huwaiti, the policy has accelerated Gaza’s economic collapse by draining liquidity from the private sector, forcing thousands of factories and businesses to shut down, and deepening the humanitarian crisis across the enclave.
He called on the international community, guarantor states, and humanitarian and trade organizations to intervene immediately to end what he described as unlawful coordination fees, reopen crossings through transparent and standardized procedures, and restore the rights of Gaza’s business community.
He said such measures are essential to restoring normal trade, reducing consumer prices, and laying the foundation for economic recovery.
Growing economic consequences
Mohammad Barbakh, acting director general for studies, development, and economic planning at Gaza’s Ministry of Economy, warned that the coordination system continues to place an increasing burden on both commercial activity and household finances.
“The financial costs are ultimately transferred to ordinary citizens,” Barbakh told Filastin. “That creates long-term economic risks.”
He said rising costs and declining purchasing power have made it increasingly difficult for families to save money or meet anything beyond their most basic needs.
Barbakh also argued that the system has reshaped Gaza’s commercial sector by creating a new class of monopolistic “war traders” who profit from exceptional circumstances.
He said the coordination process lacks transparency and depends heavily on intermediaries and brokers who generate substantial profits while residents bear the economic consequences.
Restoring open and competitive import channels, rather than concentrating trade in the hands of a limited number of merchants, is essential for Gaza’s economic recovery, he added.
Although estimates of the total financial impact vary, Barbakh said they clearly reflect the scale of the crisis created by the coordination system.
A mandatory cost of doing business
One trader, who requested anonymity, said the coordination fees have become unavoidable.
“We’re forced to pay extremely high coordination costs simply to bring goods into Gaza,” he said. “There is no clear legal framework governing these payments.”
He explained that before the war, imports entered through less complicated and far less expensive procedures.
“Today, the system has completely changed,” he said. “Large payments have become the price of moving goods across the crossings.”
Those additional costs, he added, inevitably reach consumers.
“We have no choice but to include these expenses in the final price of our products. We cannot absorb them ourselves.”
He also pointed to widespread confusion and a lack of transparency surrounding the coordination process.
Many traders have raised concerns about possible financial and administrative corruption linked to the system, saying certain parties have exploited Gaza’s humanitarian crisis for private financial gain.
According to these accounts, access to import channels has increasingly become concentrated among specific actors, encouraging monopolistic practices, driving prices higher, and limiting fair competition in the local market.
Business leaders warn that these practices have transformed Gaza’s supply chains into expensive, inefficient systems that deepen the territory’s economic crisis instead of supporting recovery.
Current estimates suggest that continued restrictions could further damage Gaza’s economy. Thousands of businesses and factories have already closed because they can no longer absorb mounting costs, while shrinking liquidity has reduced commercial activity, increased unemployment, and pushed more families into poverty.
The movement of goods into Gaza remains subject to strict restrictions and complex procedures introduced after the war. As the occupying power, Israel continues to control the entry of commercial goods into the territory, turning trade from a tool of economic recovery into another mechanism of pressure and control under the ongoing blockade.
