UN Report Indicates Gaza May Need 350 Years for Economic Recovery Under Ongoing Blockade

The United Nations has highlighted the severe impact of Israel's military actions in Gaza, suggesting it could take centuries for recovery. A recent report by the UN Conference on Trade and Development (UNCTAD) indicates that if the conflict ended immediately, it might still take 350 years for Gaza's economy to return to its pre-war state. This projection is based on the economic damage sustained since the war began in October 2023.

Before the conflict, Gaza was already struggling under a blockade imposed by Israel and Egypt since Hamas took control in 2007. The ongoing war has caused widespread devastation, with entire neighbourhoods destroyed and infrastructure severely damaged. The report stresses that returning to the pre-war conditions would not suffice for Gaza's recovery and sustainable development.

Economic Challenges and Recovery Projections

The report further explains that even if Gaza's growth rate returns to its previous average of 0.4%, it will take 350 years just to reach the GDP levels of 2022. As the population continues to grow, GDP per capita is expected to decline sharply. Rami Alazzeh, who authored the report, emphasised that recovery depends heavily on the conditions post-conflict.

The World Bank estimated in January that damage amounted to USD 18.5 billion, nearly matching the combined economic output of Gaza and the West Bank in 2022. A UN assessment in September revealed that about a quarter of all structures in Gaza had been destroyed or severely damaged, with over 227,000 housing units affected.

Reconstruction Efforts and International Aid

The Shelter Cluster, led by the Norwegian Refugee Council, calculated that rebuilding all destroyed homes under the Gaza Reconstruction Mechanism would take 40 years. This mechanism was established after the 2014 war to facilitate reconstruction under strict Israeli oversight. However, even under ideal conditions, recovery could still span decades.

A separate UN Development Programme report suggested that with significant investment and lifted restrictions, the Palestinian economy could recover by 2034. However, without these changes, predictions align with UNCTAD's grim outlook. The likelihood of positive scenarios remains low due to ongoing hostilities and political challenges.

Israel's offensive has resulted in over 42,000 Palestinian deaths, with more than half being women and children. The conflict has displaced around 90% of Gaza's population of 2.3 million people, forcing many into makeshift camps. Israel maintains that its blockade is necessary to prevent Hamas from acquiring weapons.

Political Implications and Future Prospects

Prime Minister Benjamin Netanyahu has stated that Israel will continue its security control over Gaza indefinitely. Since May, Israel has controlled all border crossings into Gaza, complicating efforts by UN agencies and humanitarian groups to deliver aid due to restrictions and ongoing violence.

International donors have shown reluctance to fund reconstruction while Gaza remains under conflict or occupation. Arab Gulf states like Saudi Arabia and the UAE have conditioned their support on progress towards a Palestinian state, which Netanyahu opposes.

As fighting continues without resolution, Israel launched another major operation in northern Gaza this month. Alazzeh noted that while calls for a ceasefire are widespread, rebuilding will be a long process under current conditions. Returning to pre-war conditions would mean continued hardship for Gaza's residents.

The situation in Gaza remains dire with no clear path forward. The international community faces challenges in addressing both immediate humanitarian needs and long-term recovery prospects amidst ongoing conflict and political complexities.