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Israel relaxes Gaza grip, permitting exports

  • Gaza can sell textiles, furniture to outside world

* West welcomes further relaxation of Israel blockade

(Recasts with details of commercial exports now allowed)

By Douglas Hamilton

JERUSALEM, Dec 8 (Reuters) - Israel on Wednesday announced a further relaxation of its blockade of the Hamas-ruled Gaza Strip, saying exports of manufactured goods would now be permitted in a move that major powers welcomed as significant.

Prime Minister Benjamin Netanyahu's office said Israel's security cabinet had approved an "additional easing of restrictions to permit and expansion of commercial exports" from the Mediterranean coastal enclave.

"The export from Gaza ... will focus at this stage on agriculture, furniture, textiles and more. The export will be done gradually and is subject to security and logistic assessments at Kerem Shalom crossing," a statement said.

Israel ended 38 years of Gaza occupation in 2005. But it began blockading the Strip in 2007 after Hamas Islamists hostile to the Jewish state seized power from Palestinians prepared to negotiate peace with Israel.

Imports were tightly restricted until June, when Israel faced a world outcry for killing nine Turkish activists in a commando raid to intercept a blockade-busting aid flotilla.

A far greater variety of consumer goods is now allowed in. But the United Nations and European Union insist that the ability to export as well is key to Gaza's economic revival. Israel's latest move "is a significant step forward and I welcome it," said Tony Blair, envoy for the Quartet of powers in Middle East diplomacy comprising the United States, United Nations, Russia and the European Union.

"It will allow albeit a limited resumption of exports out of Gaza. But it will mean for the first time in a long period of time things like furniture, textiles, and light industry will come out of Gaza, as well as agricultural produce."

He cautioned that "this will build up over time".

Hamas spokesman Sami Abu Zuhri dismissed the Israeli move. "We urge all parties not to be fooled by this Israeli propaganda," he said.

GUNS AND ROSES

More than half of Gaza's population relies on U.N. food aid. The value of its exports fell to just $20,000 in 2007, and there was no significant export trade at all in 2008.

Israel acknowledges its blockade has failed to weaken the hold Hamas has over Gaza's 1.5 million people but insists its security controls must remain in place to prevent Islamist militants bringing weapons in or sending bombers out.

While Kerem Shalom's logistics capacity will triple by next year, security remains paramount for Israel. Gaza exports have been highly suspect for Israelis since March 2004, when two Palestinian teenagers infiltrated the port of Ashdod by hiding in a shipping container. They blew themselves up, killing 10 people.

Israel smashed Gaza in a three-week assault in early 2009, killing 1,400 people in a bid to force Hamas to stop firing rockets at its southern towns. The fire dwindled but Israel says some 200 rockets and mortars have been launched this year.

Gaza farmers are already allowed to export flowers and strawberries from the enclave via the Kerem Shalom crossing, where trucks are loaded inside a blast-proof concrete corral now being expanded to handle the greater volume of expected trade.

The Palestinians hope to export 1,000 tonnes of strawberries and 30 million flowers to Europe's winter markets this month.

Gaza officials said three truckloads of flowers and strawberries went out on Tuesday and four more mixed loads on Wednesday. The perishable flowers and fruit are flown out from Ben Gurion airport for auction in Amsterdam.

Coinciding with the rare good news for Gaza was a report of further Palestinian-Israeli violence.

"An IDF force fired tank rounds at a number of suspicious individuals who approached the security fence in the northern Gaza Strip," the Israel Defence Forces (military) said in a statement.

"It seems the men were approaching the fence with the intention of planting explosive devices. The force confirmed that the suspects had been hit..."

(Additional reporting by Nidal al-Mughrabi in Gaza and Maayan Lubell in Jerusalem; Editing by Mark Heinrich)