UN report warns war setting development in Gaza back more than a decade

The poverty rate in Palestine will soar by 34 percent, thrusting nearly half a million additional people into poverty, if the war in Gaza continues for a second month, warns a United Nations (UN) report.

In such a scenario, Palestine's gross domestic product (GDP) will plummet by 8.4 percent – a loss of $1.7 billion, according to initial estimates by the UN Development Programme (UNDP) and the Economic and Social Commission for Western Asia (ESCWA).

It is estimated that, as the war hit the one-month mark, poverty had risen by 20 percent and economic growth had declined by 4.2 percent, said the two agencies in their report on the socio-economic impacts of the Gaza war on Palestine, which was released on Thursday.

The assessment warns of a sharp decline in the Human Development Index, the UNDP's summary measure of well-being, setting development in Palestine back by between 11 to 16 years, and in Gaza by 16 to 19 years, depending on the intensity of the conflict, according to the report.

According to projections, a third month of war would see poverty increase by almost 45 percent, raising the number of additional people pushed into poverty to more than 660,000, while the GDP will fall by 12.2 percent with total losses of $2.5 billion.

Currently, 1.8 million Palestinians are living in poverty, said Rola Dashti, executive secretary of ESCWA.

The poverty rate in Gaza was 61 percent before the latest escalation on October 7. The poverty rate in the West Bank was 30 percent, said Abdallah Al Dardari, UN assistant secretary-general and director of UNDP's regional bureau for Arab states.

The assessment also underscores that the International Labour Organization estimates that 390,000 jobs have already been lost in the first month of war.

"The unprecedented loss of life, human suffering, and destruction in the Gaza Strip is unacceptable," said UNDP Administrator Achim Steiner in a press release. "This assessment alerts us that the impacts of this war will also have long-lasting effects and will not be confined to Gaza. On top of the humanitarian catastrophe we see unfolding, there is also a development crisis. The war is rapidly accelerating poverty in a population already vulnerable before this crisis hit."

Dashti, who launched the report together with Al Dardari, warned that economic recovery in Gaza following a cease-fire will not be immediate, considering the large-scale displacement of the population, the massive levels of destruction and uncertain access to resources, including materials and equipment owing to the siege on Gaza.

She also warned that the consequences of the war are even more severe given the fact that the projected poverty increase is about income only.

"It's not only the money-metric poverty. It is the multidimensional poverty that is more important," she said, noting that almost all Gazans (96 percent) are currently multidimensionally poor.

Multidimensional poverty means the deprivation of essential services for livelihood, including health, utilities, transport and freedom of movement, she said.

Even if there is a cease-fire today, the multidimensional poverty situation will not improve quickly, she said.

With almost 1.5 million people in Gaza internally displaced since the beginning of the war and the massive destruction of houses reportedly destroyed or damaged, the assessment predicts that the economic downturn will further exacerbate the catastrophic humanitarian situation and will make recovery prospects challenging and slow, according to the report.

(Cover: Palestinians crowded together as they wait for food distribution in Rafah, southern Gaza Strip, November 8, 2023. /CFP)