|Coca-Cola was one of the US companies asked for bribes in order to get their goods on shelves in the Gaza Strip [EPA]
A US diplomatic cable released by WikiLeaks indicates that a key Israeli cargo crossing for goods entering the Gaza Strip was rife with corruption, forcing American businesses to pay hefty bribes to Israelis to get their products across the border.
The June 14, 2006, cable released on Thursday said distributors for major American companies that included Coca-Cola Co., Caterpillar Inc. and Motorola Inc. complained of widespread corruption at the border crossing:
As of late May 34 shipments of American goods, amounting to nearly USD $1.9m, have been waiting three to four months to cross into Gaza. US distributors assert they are being asked to pay "special fees" which amount to as much as 75 times the standard processing fee as quoted by GOI [Government of Israel] officials.
Israeli officials denied any wrongdoing at the Karni crossing, which was once a major shipping point for cargo entering Gaza. Its operations were scaled back after Hamas seized control of Gaza in June 2007.
The WikiLeaks document quoted a local Coca-Cola distributor as saying he was asked to pay more than $3,000 for each truckload of merchandise going through Karni.
The executive was identified as Joerg Hartmann, an official with Coca-Cola's distributor in the West Bank.
What does one get for $3,000 payment to move cargo? Hartmann said that for that price, your truck is promised the first place in line or a spot near the head of the so-called "Israeli line" which does move. Hartmann said that usually two or three lines at Karni are reserved for Israeli companies/shippers, which he speculated pay a much lower amount to get their products across the border.
The company did not immediately return a call seeking comment.
Hartmann claimed an unidentified "high-level official" at the crossing headed the corruption ring, but that it filtered further down, adding that Palestinian partners on the other side participated in the shakedown operation.
Of bribes and blockades
The cable says distributors from other companies, including Procter & Gamble Co., Caterpillar, Philip Morris, Westinghouse, Hewlett-Packard Co., Motorola., Aramex and Dell Inc., complained of corruption at the crossing.
The document implied that at least two of the companies, Coca-Cola and Westinghouse, paid the bribes, while a Caterpillar representative said it refused to pay the $2,667 it was asked to provide to move two small generators through the passage.
The alleged corruption occurred a year before Hamas overtook Gaza and Israel imposed an economic border blockade, restricting shipments into Gaza.
Prior to that time, however, Israeli-Palestinian violence frequently closed the border crossings, and Hartmann told US diplomats that the cost of the bribes would rise after extended closures of the border.
Under international pressure, Israel eased the blockade last summer after a deadly raid on a Gaza-bound international flotilla.
Israeli military officials that co-ordinate movement in and out of Gaza refused to comment, and Israel's Airports Authority, which operates the actual crossing points, denied any wrongdoing.
"We have looked into this. ... Nobody here had anything to do with it," said authority spokesman Adar Avisar.
In 2006, a World Bank report found that problems in Karni's operations acted as a "magnet for corruption on both sides of the border".