Gaza Strip

The September 1993 Israel-PLO Declaration of Principles on Interim Self-Government Arrangements provided for a transitional period of Palestinian self-rule in the West Bank and Gaza Strip. Under a series of agreements signed between May 1994 and September 1999, Israel transferred to the Palestinian Authority (PA) security and civilian responsibility for many Palestinian-populated areas of the West Bank and Gaza Strip.

Negotiations to determine the permanent status of the West Bank and Gaza Strip stalled following the outbreak of an intifada in September 2000. In April 2003, the Quartet (US, EU, UN, and Russia) presented a roadmap to a final settlement of the conflict by 2005 based on reciprocal steps by the two parties leading to two states, Israel and a democratic Palestine. Following Palestinian leader Yasir ARAFAT's death in late 2004, Mahmud ABBAS was elected PA president in January 2005.

A month later, Israel and the PA agreed to the Sharm el-Sheikh Commitments in an effort to move the peace process forward. In September 2005, Israel unilaterally withdrew all its settlers and soldiers and dismantled its military facilities in the Gaza Strip and withdrew settlers and redeployed soldiers from four small northern West Bank settlements. Nonetheless, Israel still controls maritime, airspace, and most access to the Gaza Strip; and it enforces a restricted zone along the border inside Gaza.

In January 2006, the Islamic Resistance Movement, HAMAS, won control of the Palestinian Legislative Council (PLC). HAMAS took control of the PA government in March 2006, but President ABBAS had little success negotiating with HAMAS to present a political platform acceptable to the international community so as to lift economic sanctions on Palestinians. Violent clashes between Fatah and HAMAS supporters in the Gaza Strip in 2006 and early 2007 resulted in numerous Palestinian deaths and injuries.

In February 2007, ABBAS and HAMAS Political Bureau Chief MISHAL signed the Mecca Agreement in Saudi Arabia that resulted in the formation of a Palestinian National Unity Government (NUG) headed by HAMAS member Ismail HANIYA. However, fighting continued in the Gaza Strip, and in June 2007, HAMAS militants succeeded in a violent takeover of all military and governmental institutions in the Gaza Strip. ABBAS dismissed the NUG and through a series of presidential decrees formed a PA government in the West Bank led by independent Salam FAYYAD. HAMAS rejected the NUG's dismissal, and despite multiple rounds of Egyptian-brokered reconciliation negotiations, the two groups have failed to bridge their differences.

Late November 2007 through June 2008 witnessed a substantial increase in Israeli-Palestinian violence. An Egyptian-brokered truce in June 2008 between Israel and HAMAS brought about a five-month pause in hostilities, but spiraling end-of-year violence resulted in the deaths of an estimated 1,100 to 1,400 Palestinians and left tens of thousands of people homeless. International donors pledged $4.5 billion in aid to rebuild the Gaza Strip, but by the end of 2010 large-scale reconstruction had not begun.

High population density, limited land and sea access, continuing isolation, and strict internal and external security controls have degraded economic conditions in the Gaza Strip - the smaller of the two areas in the Palestinian Territories. Israeli-imposed crossings closures, which became more restrictive after HAMAS violently took over the territory in June 2007, and fighting between HAMAS and Israel during December 2008-January 2009, resulted in the near collapse of most of the private sector, extremely high unemployment, and high poverty rates.

Shortages of goods are met through large-scale humanitarian assistance - led by UNRWA - and the HAMAS-regulated black market tunnel trade that flourishes under the Gaza Strip's border with Egypt. However, chnages to the blockade in 2010 included moving from a white list - in which only approved items were allowed into Gaza through the crossings - to a black list, where all but non-approved items were allowed into Gaza through the crossings.

Israeli authorities have recently signaled that exports from the territory might be possible in the future, but currently regular exports from Gaza are not permitted.