United Nation: A recent United Nations (UN) report highlights the profound economic devastation in the Palestinian territories following a month of war and Israel's near-total siege of Gaza. The report indicates a 4% contraction in the gross domestic product (GDP) in the West Bank and Gaza during the first month of the conflict, leading to over 400,000 people falling into poverty. This economic impact is unprecedented, surpassing the consequences seen in conflicts in Syria and Ukraine, as well as in previous Israel-Hamas wars.

Hamas militants initiated a surprise attack on Israel on October 7, resulting in over 1,400 casualties, mainly civilians, and approximately 240 individuals kidnapped. The conflict prompted more than two-thirds of Gaza's population, totaling 2.3 million people, to flee their homes due to intense airstrikes and an ongoing ground operation by Israel, aimed at dismantling Hamas.

The rapid economic assessment, conducted by the UN Development Program and the UN Economic and Social Commission for West Asia, is the first report outlining the severe impact of the conflict on the Palestinian economy. If the war persists into a second month, the UN projects an 8.4% drop in the Palestinian GDP, equivalent to a loss of $1.7 billion. Should the conflict extend into a third month, the GDP is expected to plummet by 12%, resulting in a loss of $2.5 billion and pushing over 660,000 people into poverty.

UN Development Program Assistant Secretary-General Abdallah Al Dardari emphasized that a 12% GDP loss at the end of the year would be "massive and unprecedented." Comparatively, he noted that during the height of the Syrian conflict, the economy lost 1% of its GDP per month, and Ukraine took a year and a half to lose 30% of its GDP.

As of January 2023, the Palestinian territories were considered a lower middle-income economy with a poverty level of $6 per day per person. Gaza was already grappling with high unemployment of about 46%, significantly higher than the West Bank's 13%. However, just a few weeks of war have resulted in the destruction of hundreds of thousands of jobs.

The report highlights significant disruptions to the economy in the West Bank, responsible for 82% of Palestinian GDP. The ongoing conflict has hindered olive and citrus farmers' ability to collect their products, impacting 61% of employment in Gaza and causing the loss of around 182,000 jobs. Additionally, disruptions to trade, money transfers from Israel to the Palestinian Authority, and a lack of investment contribute to the economic crisis.

The Economic Commission's Rola Dashti described the destruction in Gaza as "unimaginable and unprecedented," noting that an estimated 35,000 housing units have been totally demolished, and approximately 220,000 units are partially damaged. At least 45% of Gaza's housing units have been destroyed or damaged. If the situation persists, the majority of Gazans will face homelessness, leading to massive long-term displacement with extensive humanitarian, economic, and security consequences.

Al Dardari expressed concern that the Palestinian territories, which had achieved lower middle-income status, might regress in terms of growth and development by 11 to 19 years if the fighting continues, essentially returning to conditions reminiscent of 2002.