The United Nations said that the gross domestic product contracted by 4 percent in the West Bank and Gaza Strip in the first month of the war, which led to more than 400,000 people falling into poverty, an unprecedented economic impact when compared to the conflict in Syria. Ukraine, or any previous war between Israel and Hamas.
Hamas launched a surprise attack on Israel on October 7, and Israel responded with weeks of intense air strikes followed by a sustained ground operation, vowing to eliminate Hamas, forcing more than two-thirds of Gaza’s population of 2.3 million to flee their homes.
The Rapid Assessment of the Economic Consequences of the Gaza War, issued by the United Nations Development Program and the United Nations Economic and Social Commission for Western Asia, is the first UN report to show the devastating impact of the conflict, especially on Palestinians.
If the war continues for a second month, the United Nations expects the Palestinian GDP, which was $20.4 billion before the war began, to decline by 8.4 percent, a loss of $1.7 billion.
The report predicts that if the conflict continues into the third month, Palestinian GDP will decline by 12 percent, with losses worth $2.5 billion and more than 660,000 people falling into poverty.
Abdullah Dardari, Assistant Secretary-General of the United Nations Development Programme, said in a press conference on the occasion of the report’s launch that a 12 percent loss in GDP at the end of the year would be “massive and unprecedented.”
By comparison, he noted, the Syrian economy was losing 1 percent of its GDP per month at the height of the conflict, and it took a year and a half of fighting in Ukraine for the country to lose 30 percent of its GDP, an average of about 1.6 percent per month.
For her part, Rula Dashti, Executive Secretary of the Economic Commission, said that at the beginning of 2023, the Palestinian territories – the West Bank and Gaza – were considered lower-middle-income economies, with the poverty level reaching $6 per day per person.
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