Abu Mustafa, the Palestinian owner of a café in Souk al-Qattanin, which adjoins al-Aqsa Mosque in Jerusalem’s Old City, was surprised this week.1 The Israeli police informed him that he could not open his café door for the entire week of the Jewish holiday of Sukkot. The verbal police orders were followed by action on Friday morning, September 25. An Israeli military checkpoint was placed at the entrance to Souk al-Qattanin, preventing access to the entire area, including Bab al-Qattanin to al-Aqsa Mosque at its terminal point. The Palestinian owners of more than 28 shops were not able to get to their workplaces while hordes of Jewish male worshippers were allowed to enter the area to perform Sukkot rituals in front of the Cotton Merchants’ Gate, which overlooks the Dome of the Rock.

Abu Mustafa told Jerusalem Story that this is the first time that the police have closed the market for the entire Jewish holiday period. In previous years, on some days (e.g., the first and last day of the weeklong Sukkot holiday), they would order shop owners to delay opening their shops until around 10:00 a.m., once Jewish worshippers had finished conducting their prayers, he said.

Abu Mustafa’s café has become popular as a destination for Palestinian Muslims leaving the mosque after Friday prayers, taking a rest before returning to their homes. Worshippers stop to drink a cup of Turkish coffee or smoke shisha.

Not only was the market closed, but police allowed Jews to set up their own Sukkot in the small alleyways of the Old City, obstructing normal activity in and around them.

According to Hijazi Rashq, secretary of the administrative board of the Jerusalem Chamber of Commerce, commercial activity in the Old City declines by more than 70 percent during the Jewish holidays.2 The High Holy Days last for over a month, starting from the beginning of September until the middle of October each year. In some markets, such as Souk al-Qattanin, commercial activity drops as much as 80 percent due to the Israeli crackdown.

Rashq says that there are 1,400 Palestinian shops in the Old City, including 462 shops selling oriental wares. The commercial area just outside the Old City walls, specifically al-Musrara, Sultan Suleiman Street, Salah al-Din Street, and al-Zahra Street, has another 1,384 shops. Before October 7, 2023, and the increased Israeli police and right-wing Israeli activity that followed, the number of shops in the Old City that were permanently closed was 312. This figure has increased by 17 percent due to increased economic hardship, rising to 352 shuttered shops in 2026.

Rashq further added that sales in more than half of the commercial sectors have decreased by as much as 80 percent.

Rashq told Jerusalem Story that the US-Israeli war on Iran was a devastating blow to the economics of Jerusalem’s Old City. The number of visitors to the Old City drastically decreased, with a 97 percent drop in visiting tourist groups. This has led to increased unemployment and a rise in the number of closed shops. Israel and the occupied Palestinian Territories (oPT) have also witnessed soaring inflation in basic goods, especially food items.

Merchants’ savings have been depleted, their capital eroded, and goods from several seasons have piled up in their warehouses while they face mounting financial claims. Instead of relief from the Israeli government, which collects taxes, Israeli institutions have intensified their tactics against merchants with unprecedented tax enforcement, providing no financial or in-kind support.

Now the Jewish holidays are bringing the entire Old City to a near standstill for many long weeks. Police man the entrances, periodically preventing Palestinian residents of other neighborhoods from entering. Sometimes merchants prefer to stay home rather than go to their shops and endure these measures.

Rashq’s assessment was echoed in part by Tony Khashram, owner and manager of Aeolus Tours, one of Jerusalem’s leading tour companies.3

Khashram told Jerusalem Story that, in general, domestic tourism—especially from Palestinian citizens of Israel—has partially filled the void since the war on Iran wound down from its most active phase.

“Jerusalem and other Palestinian cities have witnessed significant activity, which has stimulated the economy in Jerusalem and the West Bank.” Khashram noted that this derives primarily from the sense of national pride among Palestinians within Israel, pressing them to support their compatriots in the occupied West Bank.

“Secondly, Israeli measures at the borders [to other countries] have contributed to this trend,” he said, noting that internal tourism increases when Palestinians feel less comfortable traveling abroad (see Summer at a Standstill: Long Delays and Congestion at King Hussein/Allenby Bridge and Palestinians Appeal to Israeli High Court to Demand Eased Movement at King Hussein/Allenby Bridge to Jordan). Finally, the goods in Palestinian markets are competitively priced. “Some of these goods are coming from Arab countries such as Jordan, Syria, Egypt, and even the Gulf, which is an attractive and positive factor for Arab tourists from inside Israel.”

But during the Jewish holidays, Khashram said, even these budding positive trends have come crashing down. He cited the tightened checkpoints, the total closure of Jerusalem access imposed on Palestinians with Palestinian Authority (PA) IDs coming from elsewhere in the West Bank (see Closure and Access to Jerusalem), and difficulty entering Jerusalem even for those who are allowed to do so, due to the immobility and long traffic blockages caused by the closure.

“This is further compounded by the provocative behavior of soldiers and extremist Jews in the Old City markets during these holidays,” Khashram told Jerusalem Story. He said that internal tourists are now loathe to visit the area for fear and anxiety—especially the Old City (see Fear and Anxiety Permeate Life in Jerusalem).

Saeed Younis, a shop owner on al-Wad Street, also noted the downturn in Palestinian shoppers during the Jewish holidays, but said that the business owners should take a different tack.4

“Every merchant should come and open his shop, even if the customers disappear, and even if the Israeli police obstruct their arrival.” Younis says that opening their shops in the Old City should be seen as a national duty and not as a purely profit-generating enterprise. “The Old City should not be left empty and a free stage for extremist Jews and the Israeli police,” he said.

Palestinians have no national representative in East Jerusalem, because Israel ensures that neither the PA nor the Palestine Liberation Organization (PLO) can operate there in any capacity (see The Orient House: The Heart of Palestinian Political Presence in Jerusalem). Nor is there a local body that compensates merchants for losses incurred during the Jewish holidays. The Arab Chamber of Commerce could have done so, but Hijazi Raishq, board secretary of the Jerusalem Arab Chamber of Commerce and Industry, says that “the East Jerusalem chamber that was physically located in East Jerusalem has been closed for 25 years by Israeli order, and this decision prevents it from carrying out any activity in Jerusalem” (see Institutional Capacity).5

Merchants access its services virtually through branches in al-Ram and al-‘Izariyya, which are outside the Israeli-drawn city limits (see Where Is Jerusalem: The Unfixed and Uncertain Boundaries of the City).

“The fact that it [the Chamber of Commerce] is not allowed to work within Jerusalem restricts its ability to work on finding ways to compensate merchants,” says Raishq. “Without enough dues from members and other outside support, it doesn’t have the funds to compensate merchants even if it wanted to.”

Jewish celebrations this year were even more provocative than usual, as thousands of religious Jews dressed in white with their heads covered with kippot swept through the Old City to perform prayers at all the gates leading to al-Aqsa Mosque. Tight security measures forced Palestinian residents to remain confined at home, or leave early and return late, once the restrictions were lifted. Some residents of the Armenian Quarter were even shocked to find their own streets blocked off for days, such that those who happened to be out were unable to return home for days.

Masoud Abdul Rahman, a young man from the Bab Hutta neighborhood, left his house in the early hours to go to work but was surprised by a flood of religious Jews marching and singing loudly toward his home.6 The entire area around his home near al-Aqsa Mosque was full of Israeli border police protecting the worshippers, while besieging Palestinians in their own homes.

Seeing all this, Abdul Rahman was forced to delay his return home until the march ended. He told Jerusalem Story that the police are always on edge in such circumstances, ready to shoot any Palestinian that they think is making a wrong move, and he avoided them for self-preservation.

“Of course, the Jewish holidays mean keeping Muslims away from al-Aqsa Mosque,” said an employee of the Islamic Waqf Department, who asked not to be named for fear of being detained or issued an order to stay away from the important mosque by the Israeli police (see How Israel Bans Individual Palestinians from Entering al-Aqsa Mosque and Other Areas).7 He said that the Israeli police prevent nearly everyone who arrives at al-Aqsa Mosque in the early morning hours, even the elderly and women, from entering its gates without explanation.

“Once, I heard a policeman tell them, ‘There is no prayer today,’” the mosque official stated. He said that Turkish tourists in particular are not being allowed to enter al-Aqsa Mosque on a near-daily basis. This was confirmed by a Turkish university professor who was visiting Jerusalem as part of a delegation of academics. The professor told Jerusalem Story, “The policeman told the Turks not to enter al-Aqsa. They photographed our passports and distributed them at all the gates so that we wouldn’t be allowed to enter. I was very sad, because part of the purpose of my visit to Jerusalem is to visit al-Aqsa and pray in it.” The al-Aqsa Mosque is the third most important mosque in Islam and an important pilgrimage destination for visitors from around the world.