War has set Palestine’s development back nearly 70 years

“Without lifting economic restrictions, enabling recovery, and investing in development, the Palestinian economy may not be able to restore pre-war levels and advance forward by relying on humanitarian aid alone,” Gaza war: Expected socioeconomic impacts on the State of Palestine, concludes, produced by the UN Development Programme (UNDP) and the UN Economic and Social Commission for Western Asia (UNESCWA).

The analysis suggests three recovery scenarios for Palestine. Given that the recovery will be a long-term process, the report assessed both the immediate impact projected for 2025 and the long-term impact anticipated by 2034, a decade after the start of the conflict.

“Our assessments serve to sound the alarm over the millions of lives that are being shattered and the decades of development efforts that are being wiped out,” said ESCWA Executive Secretary Rola Dashti.

“It is high time to end the suffering and bloodshed that have engulfed our region. We must unite to find a lasting solution where all peoples can live in peace, dignity and reap the benefit of sustainable development and where international law and justice are finally upheld.”

Projections estimate that the gross domestic product (GDP) will contract by 35.1 per cent in 2024 compared with a no-war scenario, with unemployment potentially rising to 49.9 per cent.

Three recovery scenarios

Building on findings published in November and May, the report estimates that poverty in Palestine will rise to 74.3 per cent in 2024, affecting 4.1 million people, including 2.61 million people who are newly impoverished.

The assessment also examines the extent and depth of deprivation, employing multidimensional poverty indicators and includes recovery prospects for Palestine after a ceasefire is reached as well as three early recovery scenarios.

The non-restricted early recovery scenario sees restrictions on Palestinian workers lifted and withheld clearance revenues restored to the Palestinian Authority.

In addition to $280 million in humanitarian aid, $290 million is allocated annually for recovery efforts, resulting in an increase in productivity by one per cent annually, enabling the economy to recover and putting Palestinian development back on track.

Unrestricted aid can help

The assessment suggests that a comprehensive recovery and reconstruction plan, combining humanitarian aid with strategic investments in recovery and reconstruction along with lifting economic restrictions, could help put the Palestinian economy back on track to realign with Palestinian development plans by 2034.

But, this scenario can only play out if recovery efforts are unrestricted, said UNDP Administrator Achim Steiner.

“Projections in this new assessment confirm that amidst the immediate suffering and horrific loss of life, a serious development crisis is also unfolding – one that jeopardises the future of Palestinians for generations to come,” he said.

“The assessment indicates that, even if humanitarian aid is provided each year, the economy may not regain its pre-crisis level for a decade or more."

As conditions on the ground allow, he said, the Palestinian people need a robust early recovery strategy embedded in the humanitarian assistance phase, laying foundations for a sustainable recovery.

Humanitarian situation deteriorating

The humanitarian situation is catastrophic and deteriorating daily, said UNDP's Chitose Noguchi, briefing reporters in Geneva from Deir Al-Balah, Gaza, where many displaced people are currently living.

“The State of Palestine is experiencing an unprecedented setback in development to the year 1955,” she said.

“Restrictions that are currently stifling the economy must be lifted,” she stressed, underlining the new assessment conclusion’s importance for the region. Currently, assessments are being conducted in Lebanon and Syria.

Read the full report here.