UN says Palestinian economy shrank ‘unprecedented’ 4% in month of war

A UN report paints a stark picture of the Palestinian economy after a month of war and Israel’s near-total siege of the Gaza Strip.

The gross domestic product shrank 4 percent in the West Bank and Gaza in the war’s first month, sending over 400,000 people into poverty, the UN says.

Hamas terrorists, who rule Gaza, launched a surprise assault on Israel on Oct. 7 killing some 1,400 people, mainly civilians, and kidnapping some 240 others.

More than two-thirds of Gaza’s population of 2.3 million have fled their homes since Israel launched weeks of intense airstrikes followed by an ongoing ground operation, vowing to obliterate Hamas.

The rapid assessment of the economic consequences of the Gaza war released by the UN Development Program and the UN Economic and Social Commission for West Asia was the first UN report showing the impact of the conflict.

If the war continues for a second month, the UN projects that the Palestinian GDP, which was $20.4 billion before the war began, will drop by 8.4% — a loss of $1.7 billion. And if the conflict lasts a third month, Palestinian GDP will drop by 12%, with losses of $2.5 billion and more than 660,000 people pushed into poverty, it projects.

UN Development Program Assistant Secretary-General Abdallah Al Dardari tells a news conference that a 12% GDP loss at the end of the year would be “massive and unprecedented.”

By comparison, he says, the Syrian economy used to lose 1% of its GDP per month at the height of its conflict, and it took Ukraine a year and a half of fighting to lose 30% of its GDP, an average of about 1.6% a month.