GAZA CITY, Gaza Strip » Two luxury hotels are opening in Gaza this month. Thousands of new cars are plying the roads. A second shopping mall — with escalators imported from Israel — will open next month. Hundreds of homes and two dozen schools are about to go up. A Hamas-run farm where Jewish settlements once stood is producing enough fruit that Israeli imports are tapering off.

As pro-Palestinian activists prepare to set sail aboard a flotilla aimed at maintaining an international spotlight on Gaza and pressure on Israel, this isolated Palestinian coastal enclave is experiencing its first real period of economic growth since the siege they are protesting began in 2007.

"Things are better than a year ago," said Jamal El-Khoudary, chairman of the board of the Islamic University, who has led Gaza’s Popular Committee Against the Siege. "The siege on goods is now 60 to 70 percent over."

Ala al-Rafati, the economy minister for Hamas, the militant group that governs Gaza, said in an interview that nearly 1,000 factories are operating here, and he estimated unemployment at no more than 25 percent after a sharp drop in jobless levels in the first quarter of this year. "Yesterday alone, the Gaza municipality launched 12 projects for paving roads, digging wells and making gardens," he said.

So is that the news from Gaza in mid-2011? Yes, but so is this: Thousands of homes that were destroyed in the Israeli anti-rocket invasion two and a half years ago have not been rebuilt. Hospitals have canceled elective surgery for lack of supplies. Electricity remains maddeningly irregular. The much-publicized opening of the Egyptian border has fizzled, so people remain trapped here. The number of residents living on less than $1.60 a day has tripled in four years. Three-quarters of the population rely on food aid.

It has never been among the world’s poorest places. There is near universal literacy and relatively low infant mortality, and health conditions remain better than across much of the developing world.

"We have 100 percent vaccination; no polio, measles, diphtheria or AIDS," said Mahmoud Daher, a World Health Organization official here. "We’ve never had a cholera outbreak."

The Israeli government and its defenders use such data to portray Gaza as doing just fine and Israeli policy as humane and appropriate: No flotillas need set sail.

Israel’s critics say the fact that the conditions in Gaza do not rival the problems in sub-Saharan Africa only makes the political and human rights crisis here all the more tragic — and solvable. Israel, they note, still controls access to sea, air and most land routes, and its security policies have consciously strangled development opportunities for an educated and potentially high-achieving population that is trapped with no horizon. Pressure needs to be maintained to end the siege entirely, they say, and talk of improvement is counterproductive.

The recent changes stem from a combination of Israeli policy shifts and the chaos in Egypt. The new Egyptian border policy has made little difference, but Egypt’s revolution and its reduced policing in the Sinai have had a profound effect.

For the past year, Israel has allowed most everything into Gaza but cement, steel and other construction material — other than for internationally supervised projects — because they are worried that such supplies can be used by Hamas for bunkers and bombs. A number of international projects are proceeding, but there is an urgent need for housing, street paving, schools, factories and public works projects, all under Hamas or the private sector, and Israel’s policy bans access to the goods to move those forward.

So in recent months, tunnels under the southern border that were used to bring in consumer goods have become almost fully devoted to smuggling in building materials.

Sacks of cement and piles of gravel, Turkish in origin and bought legally in Egypt, are smuggled through the hundreds of tunnels in double shifts, day and night, totaling some 3,000 tons a day. Since the overthrow of President Hosni Mubarak, the Egyptian security authorities no longer stop the smugglers. Streets are being paved and buildings constructed.

Karim Gharbawi is an architect and building designer with 10 projects under way, all of them eight- and nine-story residential properties. He said there were some 130 engineering and design firms in Gaza. Two years ago, none were working. Today, he said, all of them are.

Efforts by fringe Islamist groups to challenge Hamas have had little effect. And it has been a year since the government unsuccessfully sought to impose tighter religious restrictions by banning women from smoking water pipes in public. On a recent afternoon in the new Carino’s restaurant — with billiards, enormous flat-screen televisions, buttery-soft chairs — women without head coverings were smoking freely.

But such places and people represent a wafer-thin slice of Gazan society, and focusing on them distorts the broader and grimmer picture.

Samah Saleh is a 21-year-old medical student who lives in the Jabaliya refugee camp. Her father, an electrician, is adding a second story to their house now that material is available from the tunnels. Saleh will get her own room for the first time in her life, and she is thrilled. But she views her good fortune in context.

"For the vast majority in Gaza, things are not improving," she said. "Most people in Gaza remain forgotten."