Airport Rocket Attack Hurting Israel's Economy

The first suspension of flights to Israel's main international airport in more than two decades by 32 international carriers has revealed Hamas' ability to affect Israel's economy with its rockets, with experts warning of the financial cost of the latest crisis.



One rocket struck within 1.6 km of Ben Gurion Airport near Tel Aviv on Tuesday, prompting the U.S., EU and Turkey aviation authorities' flight ban. Since Tuesday, 244 out of 488 daily scheduled flights have been cancelled. However, Israeli airline El Al and British Airways have maintained their regular flight schedule.



Ben Gurion is, according to the Israeli Airports Authority, the largest airport in Israel and also the most crowded all through the year.



The airport is named for David Ben-Gurion, a Pole who emigrated to Ottoman Palestine in the early 20th Century and devoted his life to the Zionist ideal. In 1948 he proclaimed the country's independence and became its first prime minister. 



Can Acun, a foreign-policy researcher from the Ankara-based Foundation for Political, Economic and Social Research says the Hamas offensive will "bring a huge cost to the country's economy".



The air authority in Israel says around 14.2 million people travel to or from the airport every year. Twenty percent of passengers are business passengers. The country's population is about eight million.



Around 80 percent of Israel's international flights leave from Ben Gurion, while other airports in the country are only used in case of overcrowding at Ben Gurion.



Acun claims that a strong Israeli lobby in the U.S. may convince the Federal Aviation Administration to review its flight ban but "new missiles which may reach near the country's main airport would cause air traffic to be interrupted again".



On Thursday, some new international airlines decided to join those who have suspended flights to Ben Gurion because of deteriorating political conditions, Israel's Channel 10 said.



This is the first time since the first Gulf War that so many international carriers have suspended flights to the Middle East; in 1991 around 20 international airlines suspended flights to the region which hurt Israel's economy that year.



"Tourism and trade climate in Israel has been hit hard. According to some surveys in Israel, it was estimated that Israel would lose US$500 million in the last quarter of 2014 just in [the] tourism sector." Acun added.



The country's income from tourism is around US$8 billion per annum. Cancelled flights are a serious blow to the economy since tourism accounts for two percent of Israel's GDP. Last year, Israel received a record 3.5 million visitors, according to the Central Bureau of Statistics of Israel, with 1.4 million visitors in the first half of 2014. 



About 30 percent of Jewish Israelis are immigrants from other countries and many others continue to have extended family abroad, particularly in the U.S. and Europe, making air travel a necessity.



El Al, Israel's national carrier, said on Tuesday that it expects to lose at least US$40 million in the current quarter due to passenger cancellations.



Officials in Israel have been trying to restore global air connections after cancelling flights to and from the country. On Wednesday, Israel has opened up the small Uvda airport in the south of the country for more international flights.



"It seems highly probable that the cost of 2014 Gaza operation for Israel would be much higher than the operation in 2009 which was a calculated cost of US$2 billion," Acun says, adding that the mobilization of 100,000 army reservists and the sophisticated 'Iron Dome' rocket defense system will take its toll on the economy.



Despite Israel point to a high success rate for its 'Iron Dome' rocket defense system, Hamas's missiles can fly over the country, putting parts of Tel Aviv and Jerusalem at risk – as well as Ben Gurion airport, one of the most intensely secured facilities in the world.



Hundreds of Palestinians – mostly civilians – have been killed during the Israeli operation in Gaza. Around 30 Israeli soldiers and two civilians have died since hostilities began.



In the Palestinian territories, there is Gaza's airport which was constructed under the Oslo II Agreement of 1995. Named the 'Yasser Arafat International Airport' it was built with funding from Japan and other countries to a cost of US$86 million.



Initially capable of handling 700,000 passengers a year, in December 2001 Israel destroyed the radar station and control tower, and cut the runway during the Second Intifada.



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