GAZA CITY — This year Santa had to ditch his sleigh in Egypt and crawl through a smuggling tunnel to bring a little Christmas joy to the Gaza Strip.
"Some of these gifts came from Egypt through the tunnels because the crossings were closed," Emad Barakat, a Gaza City gift shop owner said, pointing to rows of chocolate Santas. "They've been selling well."
Israel and Egypt have imposed a strict blockade on Gaza since the Islamist Hamas movement seized power in June 2007, preventing all but vital goods from reaching the territory where the vast majority of people rely on foreign aid.
That has meant that many of the decorations lining the Catholic Church of the Holy Family and its adjacent school and kindergarten -- where most students are Muslim -- were brought through tunnels from Egypt.
Some 2,500 Christians, most of them Greek Orthodox, live in Gaza alongside 1.5 million Muslims.
They generally have good relations with Hamas but have been targeted in the past by smaller, more radical Islamist groups and have long been caught in the crossfire of the Middle East conflict.
On this Christmas Eve there was little cheer as the holiday came days before the first anniversary of a massive Israeli offensive on the Hamas-ruled territory.
Eyad Sayegh, a Christian pharmacist in Gaza City, went ahead and set up a tree with lights but expected a low-key holiday.
"The climate is not appropriate for celebrating Christmas because it coincides with the anniversary of the war," he said, referring to the invasion launched on December 27, 2008 that killed some 1,400 Palestinians.
Thirteen Israelis were killed during the onslaught, which was aimed at halting Palestinian rocket fire from the territory.
"We are going to limit it to religious rituals and prayers at the church and exchanging visits with family and friends," Sayegh said.
Sayegh had originally planned to go to Bethlehem in the occupied West Bank with his wife but she was not able to get a permit from the Israeli military because she is less than 35 years old.
Of the 750 Gaza Christians who applied for permits to attend the midnight mass in Bethlehem on the site of the manger where Jesus is believed to have been born, just 300 were given permission to leave.
And the Christmas spirit was further relegated into the background by intense speculation over a possible deal to exchange hundreds of Palestinian prisoners for Gilad Shalit, an Israeli soldier held by Gaza militants since June 2006.
In past years Tareq Abu Dia's gift shop was stocked with Christmas kitsch, but now the shelves are lined with posters of famous prisoners.
"Regrettably we do not have anything this year for Christmas, no Santas or gift baskets," he says. "The political situation and the subject of the prisoners have overwhelmed it."