The two-year Gaza war has severely damaged the Palestinian economy, causing one of the worst declines since 1960. Israeli attacks destroyed infrastructure, industries, and public services across Gaza. Per capita economic output has fallen to levels last recorded in 2003.
According to the UN Conference on Trade and Development (UNCTAD), the crisis ranks among the world’s ten most severe economic declines in decades. Gaza’s key sectors, including industry and public services, have suffered widespread destruction.
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The report warns that Gaza’s recovery could take decades and will require extensive international support. Reconstruction efforts will depend heavily on foreign aid, investment, and coordinated rebuilding initiatives.
The West Bank has also experienced significant economic contraction. UNCTAD attributes the decline to Israeli restrictions, strict control over movement, and trade limitations that hinder economic activity.
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Experts caution that without urgent international intervention, both Gaza and the West Bank may struggle to restore livelihoods and public services. Long-term support is crucial to prevent further economic collapse.