The United Nations Conference on Trade and Development (UNCTAD) announced in a report published today, Wednesday, that Gaza's economy may take until the later years of this century to regain the size it had before the conflict, if fighting in the Palestinian territory stops immediately. UNCTAD noted that the conflict has led to a contraction of 24% in Gaza's GDP and a 26.1% decrease in GDP per capita for the entire year of 2023.
UNCTAD stated that if military operations ended and reconstruction began immediately, and if the growth trend observed in the sector from 2007 to 2022 continued at an average annual rate of 0.4%, Gaza could recover its pre-conflict GDP levels by 2092. In the best-case scenario, where GDP grows by 10% annually, it would not be before 2035 that GDP per capita in Gaza returns to what it was in 2006, prior to Israel imposing a permanent land, sea, and air blockade in 2007 citing security concerns.
Rami Al-Izza, Economic Affairs Officer at the UNCTAD's Assistance to the Palestinian People Unit, said, "It will take until 2092 for Gaza to return to its level in 2022, which was not a good situation at all for the residents of Gaza." He added, "I believe the most important conclusion from the report is that the level of destruction we are witnessing in Gaza is unprecedented. It will require extensive efforts from the international community to rebuild and recover in Gaza."
UNCTAD noted that Gaza's recovery after the previous Israeli military intervention in 2014 required approximately $3.9 billion. It added that these needs would be much higher following the current conflict. Al-Izza stated, "Given the level of destruction and the intensity of damage we are currently witnessing in Gaza, and as military operations are still ongoing, the amount required for recovery in Gaza will be several times the amount required after the 2014 war, which was $3.9 billion."
UNCTAD's estimates indicated that Gaza's economy was already in turmoil even before the conflict due to the Israeli economic blockade, with the sector's economy contracting by 4.5% in the first three quarters of 2023. Two-thirds of the population lived in poverty, and 45% of the workforce were unemployed prior to the outbreak of the war. UNCTAD stated that as of December, unemployment soared to an astonishing rate of 79.3%. Al-Izza remarked, "I do not believe that the international community or the people in Gaza can endure decades of humanitarian catastrophe... Gaza must be part of the development priority list rather than being treated as a humanitarian case."
