Mohammed, covered in dust and dirt, is in the process of digging a 750m (2,460ft) smuggling tunnel from Gaza into Egypt. He says he's been digging it for 18 months.

As he hauls up a plastic container of sand with an electric winch from the metre-wide tunnel shaft, he says the new underground Egyptian barrier aimed at stopping smuggling is a "joke."

"We just cut through it using high-powered oxygen fuelled blow torches," he says.

The Egyptian government says it began constructing the barrier along the Gaza-Egypt border last year. When finished it is meant to be 11km-long (seven miles), stretching down 18m (59ft) underground.

According to Egypt it is made of bomb-proof, super-strength steel and is costing millions of dollars to build.

'Embarrassing'

Mohammed smiles when he hears this.

"We pay around a $1,000 (�665) for a man with an oxygen-fuelled cutter to come and break through it. It takes up to three weeks to cut through but we get there in the end," he says.

If they [Egypt] opened the border, we wouldn't need to dig tunnels. But until they do, we'll keep digging, whatever they do to try and stop us

Mohammed, tunnel digger

Mohammed says the steel barrier is 5-10cm (2-4in) thick.

The BBC spoke to one man in Gaza employed to cut through the barrier. He said he could cut a metre-square hole through it in less than a day.

This news will be embarrassing for Egypt's government.

Encouraged by the United States which gives millions of dollars in military aid to Egypt every year, it says it is trying to crack down on smuggling into Gaza.

The BBC asked the Egyptian government to comment on the fact that Gazans were already cutting through the barrier. The government has not yet responded.

Sheep and shampoo

The Palestinian territory has been under a tightened Israeli and Egyptian economic blockade since 2007 when the Hamas Islamist movement took over the territory.

The blockade was enforced to put pressure on Hamas and to stop weapons being smuggled in.

Little attempt is made to keep the tunnels secret

Egypt's secular government is opposed to Hamas, which has historical ties to the Muslim Brotherhood, the main opposition movement in Egypt which is illegal but largely tolerated.

Many Gazans are angry with the Egyptian government, which - they say - is increasing their suffering.

The blockade has meant that Gaza is to a great extent dependent on the smuggling tunnels from Egypt. Millions of dollars worth of goods are smuggled in every month.

Everything from fridges to fans, sheep to shampoo comes through the tunnels. The BBC even obtained video footage this year of whole brand-new cars being dragged through tunnels from Egypt.

The UN estimates that as much as 80% of imports into Gaza come through the tunnels.

Big business

The tunnels are not at all hard to find. In the southern Gazan town of Rafah, right on the border, there are lines of them covered by white tents.

Little attempt is made to keep them secret. They are surrounded by huge mounds of sandy earth which have been dug out of the ground.

The air is thick with diesel fuel from the trucks that transport the goods across the Gaza strip.

The openness of the smuggling operation suggests that if Israel and Egypt really wanted to stop the tunnels they could easily do so.

Israel has at times bombed some of the tunnels, but has stopped short of totally shutting them down.

Aid agencies in Gaza say that if Israel or Egypt really forced the smuggling to stop, it would lead to an even more desperate humanitarian situation in Gaza which would be damaging to Israel's and Egypt's international reputations.

Diplomats in the region also believe that so much money is being made in Egypt from the trade through the tunnels that much of the smuggling is likely to continue.

But the head of operations in Gaza for the UN relief agency Unrwa, John Ging, says that ordinary people in Gaza are losing out.

"Everything is expensive because people are hostage to the dynamics of a black market."

Mr Ging stressed that it was the Israeli-Egyptian blockade that was allowing that black market to thrive.

The UN does not use illegal goods and building materials smuggled in through from Egypt.

If the blockade remains in place it seems the tunnel industry will continue to thrive, underground steel barrier or not.

"If they opened the border, we wouldn't need to dig tunnels," says Mohammed peering into the shaft of his tunnel in Rafah. "But until they do, we'll keep digging, whatever they do to try and stop us."

"Every problem has a solution," he smiles.