Israeli War Pushes 1.74 Million Gazans into Poverty as Economy Collapses

The ongoing Israeli war on Gaza has pushed an additional 1.74 million Palestinians into poverty, with the poverty rate in the State of Palestine skyrocketing to an alarming 58.4%, according to a recent report by the United Nations Development Programme (UNDP) and the Economic and Social Commission for Western Asia (ESCWA).

The war, now in its seventh month, has dealt a devastating blow to Gaza's economy, causing the Gross Domestic Product (GDP) to plummet by 26.9%, equivalent to a staggering loss of $7.1 billion.

Why this matters: The humanitarian crisis in Gaza has far-reaching implications for regional stability and global security, as it exacerbates existing tensions and fuels resentment towards Israel and the international community. If left unaddressed, the crisis could lead to further violence, displacement, and radicalization, with devastating consequences for the entire Middle East.

The report paints a grim scenario of the human toll of the conflict, with UNDP Administrator Achim Steiner warning, "Every additional day that this war continues is exacting huge and compounding costs to Gazans and all Palestinians, now and in the medium and long term.

Compared to our preliminary assessment, these new figures warn that the suffering in Gaza will not end when the war does. "The extraordinary levels of human losses, capital destruction, and steep rise in poverty in such a short period will precipitate a serious development crisis that jeopardizes the future of generations to come."

The destruction in Gaza is unparalleled in scope and scale, with the loss of homes, livelihoods, natural resources, infrastructure, and institutional capacities. ESCWA Executive Secretary Rola Dashti emphasizes, "Unlike previous wars, the destruction in Gaza today is exceptional in scope and scale and coupled with the loss of homes, livelihoods, natural resources, infrastructure and institutional capacities, may have deep and systemic impacts for decades to come.

"The report estimates that the setback in human development in the State of Palestine may exceed two decades, reversing progress made since 2004.

If the war persists for nine months, the poverty rate is projected to reach a staggering 60.7%, 2.25 times the pre-war levels, pushing an additional 1.86 million people into poverty. The GDP loss is expected to reach 29%, amounting to $7.6 billion. These figures highlight the urgent need for a cessation of hostilities and a comprehensive plan for rebuilding Gaza's shattered economy and infrastructure.

The report's findings are further corroborated by a joint assessment conducted by the World Bank and the United Nations, which estimates that direct damages inflicted on Gaza's built infrastructure amount to approximately $18.5 billion, equivalent to a staggering 97% of the total GDP of the State of Palestine in 2022. This level of destruction is unparalleled and will require a massive international effort to rebuild and recover.

The UNDP and ESCWA are working closely with UN agencies and national partners to plan and prepare for early recovery in Gaza and the West Bank, including east Jerusalem, as conditions allow. However, the scale of the crisis requires a concerted international response to address the immediate humanitarian needs of the Palestinian people and to lay the foundations for a sustainable and just peace.

The devastating socio-economic impacts of the war, as outlined in the UNDP and ESCWA report, serve as a powerful illustration of the urgent need to end the conflict and support the long-term recovery and reconstruction of Gaza. With poverty rates soaring, the economy in shambles, and human development gains reversed by decades, the international community must act swiftly to prevent further suffering and instability in the region.

Key Takeaways

• War in Gaza pushes 1.74 million Palestinians into poverty, 58.4% poverty rate.
• GDP plummets by 26.9%, $7.1 billion loss, devastating Gaza's economy.
• Humanitarian crisis fuels regional instability, radicalization, and violence.
• Destruction in Gaza is unparalleled, may have deep impacts for decades to come.
• International response needed to address humanitarian needs, rebuild Gaza.