Gaza conflict could spark rise in poverty, UN agencies fear

The assessment by the UN Development Programme (UNDP) and the Economic and Social Commission for Western Asia (ESCWA) looks at preliminary socio-economic impacts, warning that poverty could spike while Gross Domestic Product (GDP) could plummet by 8.4 per cent, which translates into a loss of $1.7 billion.

Lamenting the loss of life, suffering and ongoing destruction, the UN agencies underscored the need for a ceasefire and sustained flow of humanitarian aid as a critical first step.

Rising poverty, unprecedented destruction

Although the conflict is occurring in Gaza, spillover effects are being felt in the West Bank and also in Lebanon, Jordan and Egypt. 

Some 1.8 million people across the State of Palestine were already living in poverty before hostilities erupted on 7 October. The figure could soar by 34 per cent if fighting continues through a second month, meaning that nearly half a million additional people will be joining them.

Nowhere to go

Already 35,000 housing units in Gaza have been totally demolished, and around 212,000 partially damaged, which the agencies said is unprecedented.  For comparison, it took four years of fighting in Syria to lose the same percentage of housing stock.

Gaza has a population of over two million and nearly 1.5 million residents are now internally displaced.

“If this war persists, the majority of Gaza’s population might find themselves with nowhere to go, to call home, or to stay,” said Rola Dashti, Executive Secretary at ESCWA, which is based in Beirut.

She added that a “horrifying” 96 per cent of Gazans now face unprecedented deprivation of all essential services and have fallen into what is known as multidimensional poverty.

GDP and jobs losses

Furthermore, the overall Palestine economy has lost four per cent of GDP in just one month, while 390,000 jobs have evaporated, said Abdallah Al Dardari, UNDP Assistant Secretary-General and Director of its Regional Bureau for Arab States.

Forty-five per cent of UNDP projects in Gaza have already been destroyed, he added.  Health centres, solar power stations, water treatment plants, and centres that offer support for the private sector, small business and women are now gone.

“Even more important, if I may say, is the loss of human development,” he continued.

“After two months of fighting, Palestine, and not just Gaza, would have lost 16 years of human development, health and education and infrastructure and economic growth that would be wiped out. Palestine would go back to 2005.”

Slow road to recovery

Given the widespread displacement in Gaza since the beginning of the war, and the massive destruction of houses reportedly destroyed or damaged, the report predicts that the economic downturn will further exacerbate the catastrophic humanitarian situation and make recovery prospects challenging and slow.

Ms. Dashti urged the international community to unite and broker lasting peace.

“History teaches us that without sustainable peace, all stakeholders in this conflict will not only suffer more loss of lives in the future but their prospects for sustainable development meant will also be jeopardized and their hard-won gains of economic prosperity and social empowerment will be eroded,” she said.