What The 'Tunnel Economy' Means To Gaza

04:57

August 20, 2012

Palestinian smugglers push sheep through a smuggling tunnel from Egypt to the Gaza Strip in the Rafah refugee camp, southern Gaza Strip, in 2010. (AP)

It's been two weeks since 16 Egyptian policemen were killed in an attack by militants in the Sinai Peninsula close to Egypt's border with Israel and Gaza.

Egypt and Israel blamed Islamic extremists and suggested some of them might have come from Gaza. One of Egypt's responses was to threaten to shut down the huge network of smuggling tunnels that cross into the Palestinian territory.

The so-called "tunnel economy" has flourished as a result of Israel and Egypt's blockade of Gaza, tightened when Hamas came to power in the strip 5 years ago. The BBC's Jon Donnison looks at to what extent Gaza is still dependent on the tunnels and what impact their closure might have.

This segment aired on August 20, 2012.