Logistics


Air Transport

Re-export points in Egypt for Gaza products through Cairo for air transports.

Sea Transport

Re-export points in Egypt for Gaza products through Suez for sea transports.

Nueba for sea or land transport from WB to or through Jordan.

Road Transport

Exports from Gaza to/through Egypt via the Rafah crossing point
In most cases, only products originating from Gaza are allowed through this route. West Bank products intended for export are not allowed passage to Gaza via Israel if transported by West Bank-licensed vehicles. Using Israeli vehicles to transport West Bank goods to Gaza for export is rarely used due to the significantly higher costs involved. West Bank-produced goods destined for Egypt face much higher transaction costs, as they must be exported through Jordan, thereby increasing the costs, time, logistical difficulties and risks required to reach their destination.

On the Gaza-Rafah Route, goods are transported on Gazan trucks through Gaza to the Rafah Crossing Point. Palestinian customs officials then inspect them and a branch office of the Bank of Palestine is located there to receive payment for customs to the PA, if any are due. Passing through this point, the trucks enter the Israeli controlled zone at the Rafah Crossing Point, where an Israeli clearing agent/trucking company, who prepares the goods for inspection, unloads the goods for the Israeli customs and security. Upon completion, the trucking company loads the goods onto Egyptian trucks, which proceed to the Egyptian border for clearance. After that point, these trucks proceed to deliver the goods to the importer or to the re-export destination.

Exports from Gaza to/through Jordan via the Damya crossing point
Gaza products destined for export to or through Jordan go through the Israeli Erez checkpoint. After inspection and clearance by Palestinian customs officials and Israeli security, these trucks are escorted in convoys of 5 to 15 trucks each by Israeli security patrols through Israel. The convoys usually travel one of two different routes:

Route 1: Erez - Beer Sheva road - Hebron - Bethlehem - Wadi Al-Nar - Jericho

Route 2: Erez - Ashqelon - Latrun – Jerusalem (Giv’at Ze’ev Junction) - Jericho

At Jericho, there are two options:

For goods transported by green trucks: These trucks proceed directly (escorted all the way through the Palestinian and Israeli sides, since the merchandise has already been checked and cleared at Erez) to the Jordanian side at Damya. After being checked and cleared for customs by the Jordanian customs authority, these trucks drive to their final destination at the Al-Shouna point in Jordan, where they unload onto Jordanian trucks. The Jordanian trucks then proceed to deliver the goods to the importers or across the Jordanian borders to other Arab countries. The green trucks are not allowed beyond this point at all.

For goods transported by non-green truck vehicles: the trucks enter the Israeli-Palestinian Liaison Office area at the outskirts of Jericho, where the goods are transferred in what is commonly referred to as the “back-to-back” method to West Bank trucks. West Bank trucks then proceed to the Damya crossing point, where another back-to-back transfer takes place with Jordanian trucks, and these proceed to deliver the goods to the importers or across Jordanian borders to other Arab countries.

Recently, and due to the continuous Palestinian pressure to solve the GTs problems, the PA, Jordan and Israel have agreed to keep 40 Palestinian trucks in the security zone at Allenby crossing point. The 40 trucks will be used to transport mainly citrus products coming from Gaza, to Jordan. The trucks need not pass through security procedures every time they cross the borders since all the trucks should return and stay at the security zone on the Allenby crossing point. This procedure does not eliminate the back-to-back process but speeds up the trading process.

West Bank to/through Jordan via the Damya and Allenby crossing points
These are the only practical routes for land transport of West Bank-produced goods destined for export to or through Jordan. Goods are either loaded onto green trucks or other West Bank-licensed vehicles at the producer’s factory, which then proceed to Damya or Allenby. At Damya for example, all vehicles must pass through Palestinian and Israeli crossing points for security inspection and customs and document checks. They are then driven to the Jordanian side and are inspected by Jordanian customs officials.

Non green truck vehicles must then transfer the goods back-to-back to Jordanian trucks, which proceed to deliver the goods to the importer or across the Jordanian borders to other Arab countries. The green trucks proceed in the same way as those from Gaza.

Re-export points in Jordan
There is only one re-export point in Jordan for Palestinian goods, located at Al-Shouna in the Jordan Valley. This point is only for goods transported via green trucks. Goods transported via regular trucks are transferred back-to-back to Jordanian trucks, which in turn deliver the goods directly to the importers or cross the Jordanian borders to other Arab countries.

For practical purposes, Damya Crossing Point might be considered as a re-export point since goods transported via non-green truck vehicles are transferred back-to-back to Jordanian trucks which directly proceed to cross Jordanian borders to other Arab countries.

Imports from/through Egypt and Jordan

In reality, the level of import transactions is much more than the levels of export transactions for Palestinian traders. In 1998, a monthly average of 2,822 truckloads is exported through all the monitored crossing points, compared to 14,476 imported truckloads. As for the three mentioned crossing points alone, the same report indicated that an average of 1,189 truckloads were imported monthly, compared to 599 exported truckloads.

Many traders indicated that importing procedures are much more complicated than those for exporting. The reason for this attitude stems from the fact that imported products are subject to lengthy and costly inspection and “security” procedures. Besides the security inspection, many imported items are subject to laboratory inspection, as they have to meet Israeli standards (in accordance to the Israeli Standards Institute - ISI).

Importing from Jordan via Allenby crossing point

Palestinian traders should have a prior arrangement with a Jordanian and an Israeli clearing (customs) agent, since no Palestinian clearing agency is permitted at any of the crossing points. The trader should provide the clearing agents with an identical copy of all the original documents (the L/C, Packing List, Performa Invoice, Certificate of Origin, Import License, and the Standard Certificate). The trader should inform the agents at least 48 hours before the arrival of the shipment to avoid any unpleasant and costly surprises.

The cargo loaded onto a Jordanian truck should pass all inspection and customs procedures on the Jordanian side. Upon arrival, the Jordanian forwarder informs the Israeli forwarder about the cargo. Having been inspected, the vehicle proceeds from the Jordanian side to the Israeli side, and the Jordanian truck will be asked to enter what is known as area “X” for inspection purposes. No Palestinian is allowed in area X. A private Israeli company is responsible for the unloading and the reloading activities in return for fees charged to the Palestinian importer, calculated according to the number of crates (pallets). The fee usually charged is $5 per crate.

To make the inspection process easier, all the imported products should be put on crates. For reasons of security and visibility, the height of the crate should not exceed 1.2 m, and approximately 20cm of space should be provided between the crates. All the cargo is unloaded for inspection. On some occasions, inspectors use a long, thin metal instrument for inspection. This device may damage some items if it penetrates any of the boxes. Having been inspected by the custom and security officers, the cargo is reloaded onto a Palestinian truck, and given a gate pass, which then proceeds toward the Palestinian side for customs and tax checking, and then to its destination. The back-to-back process, mentioned earlier, is also applicable on imported products.

For those imported items that are required, according to the Tariff Book, to obtain standard certificate from the Israeli Standards Institute ('Mikontekanim') there are two options available. The first option, an inspector from the ISI is to take a sample of the imported items at the crossing point for examination. In this case the importer will have to wait for the laboratory results before being able to do any thing with the imported items. Since there are no bonded houses at the crossing points, this procedure could turn out to be very costly if any delay in the laboratory occurs. Therefore this procedure is very limited.

The second option is for the trader to provide the IRI laboratory with a sample item for examination, before receiving the cargo. This procedure could save time and money.

Importing cement from Jordan via Allenby crossing point

As for importing cement from Jordan, the procedures are usually different. Although similar arrangements could be envisaged for other types of goods, such facilities are normally justified by the large amount of imported items. There are many advantages to this arrangement, especially:

The coordination for importing the whole amount is made once a year. Therefore, coordination fees (40 JDs per shipment) are paid only once.

No need for the “back-to-back” process since the same trucks will reach the final destination in Jericho.

The unloading and reloading fees ($5 per crate) will be reduced to one dollar since the unloading will tack place at the importer warehouses in Jericho.

The damage and delay costs will be reduced substantially due to the extra care given by the exporter and the importer to the loading and unloading processes.

These special arrangements normally reduce the delay caused by the Israeli security and inspection procedures at the crossing point. This allows an average of 70 cement trucks to cross Allenby daily.

Import procedures at Rafah crossing point

The general import procedures at Allenby are also applicable at Rafah crossing point. The importer should have completed all the arrangements with the clearing agent and prepared all the needed documents. The cargo loaded on Egyptian trucks should pass all the inspection procedures at the Egyptian side of the crossing point. Then the cargo will be unloaded in area “X” at the Israeli side for security and inspection procedures. A Palestinian truck should be ready for the reloading process. After the cargo is checked and reloaded on the truck, the driver will be given a pass to exit the crossing point. PA customs and security, present near the crossing point, will check the pass and allow the vehicle to enter.

If the destination of imported goods is Gaza, then the goods will be transported to their destination in the Strip. If the final destination is the West Bank, all the checking and the “back-to-back” procedures will take place at Erez checkpoint if an Israeli truck is to transport the cargo. This increases the costs of importing. Special arrangements could be done where-by Gazan trucks could transport the cargo into the West Bank through Karni crossing point. In this case the security inspections and the convoy system will be implemented. An average of 30 Palestinian trucks crosses Karni to the WB daily. At the same time about 200 shipments, coming from Israel crosses Karni into Gaza. The “back-to-back” process is used where the goods will be loaded onto Palestinian trucks and transported into Gaza.

Vehicle routes

According to the different agreements that the PA has signed with Israel, Jordan and Egypt, as well as Israeli “security” reasons, Palestinian-licensed vehicles do not enjoy freedom of movement. Green trucks are the only vehicles that are allowed to cross the borders. They are also forbidden from entering Israeli proper. The below table shows the routes that freight transport vehicles are permitted to use.

Transport Vehicles and Routes

Trucks Routes
Regular trucks registered in Gaza –
Need special arrangements
Gaza to Rafah
Gaza to Liaison office in Jericho
Green Trucks registered in Gaza Gaza to Al-Shouna (Jordan)
Trucks registered in Egypt Rafah to destination point in Egypt
Trucks registered in the West Bank West Bank to Damya
Liaison office in Jericho to Damya for goods delivered by regular Gaza trucks
Green trucks registered in the West Bank West Bank to Al-Shouna
Trucks registered in Jordan Damya or Al-Shouna to destination point in Jordan/ Arab states
Trucks registered in Israel West Bank to Gaza -- used rarely when West Bank goods are destined to Egypt

Costs associated with a trade Transaction:

Imports from Jordan (per shipment)

Item no. Description Amount charges not subject to VAT (NIS) Amount charges subject to VAT (NIS)
I- Jordanian Side
01 Transportation to King Hussein Bridge(JD 70) 406
02 Clearance Formalities of KHB (JD 70) 406
II- Palestinian / Israeli Side
01 Coordinating fees (PNA) 120
02 Allenby Bridge Entry fees (ISR) 139
03 Allenby Bridge Entry fees (PNA) 125
04 Allenby Bridge usage fees (PNA) 117
05 Off landing/loading charges of Allenby Bridge 292
06 Bank charges 29
07 Clearance Formalities 486
08 Inland transportation 700
09 Attendance charges 324
TOTAL 1634 1510
17% VAT 256
1766
Grand Total NIS (US$1 = NIS 4) 3400

Other possible costs for Gaza traders

Activity

Costs ($)

Import costs ( from Egypt)  
Transport fees from Cairo to Rafah crossing point 250
Transport fees from Rafah to Gaza 100
Average unloading and reloading $5 / crate 80
Clearance fees 120
Total

$550

Export costs ( to Jordan)  

Transport fees from Gaza to Allenby

350

Clearing charges at Jordan side if the cargo is transit

80
Transport fees from Jordan crossing point to Airport 170
Total

$600 *

Add to that figure the entrance fees of $30 at the gate in Jericho

Overland Transport Constraints

Policy/infrastructure
From 1967 until 1998, road transport was the only mean of transport available for passengers and traders in the Palestinian territory. The majority of the road network is deteriorated, in poor conditions and of two lanes. Many of the main roads that interconnect major Palestinian cities with each other, or with crossing points, pass through populated areas.

The geographic separation between the West Bank and Gaza Strip, the division of the West Bank into areas A, B, and C, in addition to lack of financial resources, are factors which complicate the ability of the PA to develop the road network. Moreover, such factors are hindering the orientation of the PA to create an integration system between the PA areas and the neighboring countries.

Although the existing road network does provide connectivity to the crossing points with Egypt (Rafah) and Jordan (Damya & Allenby), due to the complexity and length of this network, the trip to such crossing points was described by many transporters to be costly, timely and dangerous.

Israel enjoys almost complete control over the borders and security measures enforced at crossing points. Israeli security measures constitute another set of obstacles to transporters and trucking firms including:

Some drivers inside Jordan need to obtain a security clearance, which may take a month to obtain.

The security inspection of the goods and the vehicles takes a detailed process and may result in damaging or destroying the goods.

Trucks and trailers that need to enter the PA areas must also obtain a security clearance from the Israeli side, which is difficult to obtain most of the time.

Security checks are excessive and do not follow a methodical norm that can be understood and complied with.

The most critical factor causing weak Jordanian-Palestinian transport arrangements is that cooperation and coordination between Jordanian and Palestinian transport companies, especially in overland transport of goods do not exist. In addition, trade-related support enhancement facilities between Jordan and the PA do not exist. As a result,

no public or private warehouses or storage areas are operated on the Bridges or on the way to the bridges, or between the Amman Customs center and the bridges;

support services, do not exist for travelers, transporters, truck/trailer drivers, clearing agents, and traders on the way or on the Bridges; and

Service stations for cargo and passenger vehicles are rare between important hubs inside Jordan and the Bridges.

There are no special transport or transit arrangements governing the overland transport of goods between Jordan and the PA. Also, there are no special or joint arrangements between Jordan and the PA addressing the Trans-shipment, storage, or warehousing of goods transported between both sides.

Procedural/institutional
Most observers perceive the border procedures and the administrative requirements to be lengthy, costly and unclear. The Israeli Authority imposes several “security” regulations and procedures that complicates and delays the trade transactions. Permits (passes) for drivers and vehicles have to be approved by the Israeli Authority.

Restrictions on movement of goods between the West Bank and Gaza particularly rule out exports to Egypt from the West Bank in practice. On the other hand export from Gaza to Jordan is also subject to delays resulting from convoy scheduling. Security checks themselves often lead to damaged goods or packaging.

Internal transport of goods also face security considerations. Convoys are not regularly scheduled for security purposes, so it is impossible to schedule connecting transport services.

The transfer of goods through back-to-back or unloading/reloading procedures incurs additional cost for the company. This process damages goods and packaging and has in some instances resulted in an importer rejecting the shipment.

Jordanian forwarders are asked to pay taxes on the entry of their vehicles, which are collected by both the Palestinian and Israeli sides. The Tax amounts to about 118 Shekels. Each side collects about JD 20. Also, fees on loading and unloading at the Bridges are excessive compared to Jordan. If a delay takes place at the bridge, due to Israeli security arrangements, Israelis impose a penalty that is seven times higher than the prevailing rate on delays in Jordan.

While shipping costs from Jordan to the PA are twice as much due to the back-to-back system, transit cargo are only using the Prince Mohammed Bridge and no Palestinian customs officials are present on the King Hussein Bridge. Most forwarders agree that if Israeli practices stop, transport costs would decrease by at least 40%.

All products exported to the PA must obtain pre-import license from Israel (through the Civil Administration), and all goods shipped to the PA are given specific entry dates. This process costs the Jordanian exporter about JD 40 in “Coordination fees” on each permit.

Transporters and truck owners explain that high transport costs push up the price of Jordanian exports to the PA. Problems facing the overland transport modes account for the major part of the high export costs:

The specification of the times that trucks and trailers are allowed to enter the bridges causes many problems.

Not all routes can be taken to transport goods from the Amman Customs to the bridges.

Not many companies are ready to transport goods to the bridges.

Many Jordanian goods get damaged or destroyed as a result of the Back-to-Back system on King Hussein Bridge.

Imposing “strict specifications” on the types of goods that can enter into the PA, such as palletized goods packed with certain lengths and packing methods increase the cost of transporting the goods through the bridges.

Israeli inspection and testing equipment on the Palestinian side are not fit to test all types of packing and packages.

Israel requests that Jordanian overland transport modes are of certain specifications, which means very few Jordanian trucks and trailers are in compliance with such rules.

In trade with Egypt:

Security Obstacles for trucks inside the common control area to the limit of leaving a truck inside the x-ray chamber for more than an hour.

The difference in the fees for the imported goods from Egypt which is 17% in Nitzana and 22% in Rafah (17% + 5% for Israel).

Maximum permissible numbers of trucks to be inspected by the Israeli security is 25 trucks per day.

Transit services are not encouraging in the Egyptian customs area as they ask for original invoice endorsed and do not accept a copy.

Technical
Some 163 trucks (green trucks) that are permitted to cross the borders with Jordan are completely stripped and sealed, besides being 25 years old and deteriorated.

The existing facilities at the PA side of the crossing points are not suitable, lacking some support services like warehouses, bonded houses and post offices.

The short working hours at the crossing points, particularly in the summer time.

Jordanian forwarders do not find any storage facilities on the borders. The present loading and unloading facility on the Prince Mohammed Bridge is not a proper storing area. Forwarders find no way but to use the facilities at the Sheikh Hussein Bridge, which is not a Jordanian-Palestinian crossing point. Moreover, those who transport to the PA through either of the two designated bridges also deal with Israeli counterparts through Sheikh Hussein Bridge.

The most critical factor causing weak Jordanian-Palestinian transport arrangements is that cooperation and coordination between Jordanian and Palestinian transport companies, especially in overland transport of goods do not exist. In addition, trade-related support enhancement facilities between Jordan and the PA do not exist. As a result,

no public or private warehouses or storage areas are operated one the Bridges or on the way to the bridges, or between the Amman Customs center and the bridges;

support services, such as restaurants, rest houses, shops, utilities, post office with phone lines and fast communication modes of any type do not exist for travelers, transporters, truck/trailer drivers, clearing agents, and traders on the way or on the Bridges; and

Service stations for cargo and passenger vehicles are rare between important hubs inside Jordan and the Bridges.

There are no special transport or transit arrangements governing the overland transport of goods between Jordan and the PA. Also, there are no special or joint arrangements between Jordan and the PA addressing the transshipment, storage, or warehousing of goods transported between both sides.

In trade with Egypt:

The Israeli security chief creates difficulties for the Egyptian exports to PA, and also controls the kinds of goods to be cleared and entered to the point of keeping cement shipment of Palestinian Air Port construction for 11 days waiting to be permitted to be cleared.

Israeli cargo inspection is effected with the intention to spoil the cargo especially for fresh fruits & vegetables by passing an iron bar through the goods for inspecting procedures.

Return delays: same procedures for import as well as export.

Lack of coordination, communication and lake of procedural directives.

Warehousing Facilities

No public or private warehouses or storage areas are operated on the Bridges or on the way to the bridges, or between the Amman Customs center and the bridges. However, Industrial and Free Trade Zones have such facilities.