Gaza Faces Decades of Recovery, $70 Billion Rebuild as UN Declares “Human-Made Abyss”
The United Nations has warned that reconstruction in Gaza is likely to cost over $70 billion (£53 billion) and take decades, following the devastating impact of recent conflict. A new report from the UN’s trade and development agency (Unctad) paints a grim picture of economic collapse and widespread impoverishment, describing the situation as a “human-made abyss.”
The Unctad report details how Israeli military operations have “significantly undermined every pillar of survival” for Gaza’s 2.3 million residents, leaving the entire population facing “extreme, multidimensional impoverishment.” The scale of the economic damage is staggering, with Gaza’s economy contracting by 87% between 2023 and 2024. This has resulted in a GDP per capita of just $161 – among the lowest figures globally.
Beyond Gaza, the report highlights the parallel decimation of the West Bank economy due to “violence, accelerated settlement expansion and restrictions on worker mobility.” “Plummeting revenues and the withholding of fiscal transfers by the Israeli government have severely constrained the Palestinian government’s ability to maintain essential public services and invest in recovery,” the report states. This comes at a time when substantial investment is urgently needed to rebuild infrastructure and address growing environmental and socioeconomic challenges.
The economic contraction represents a dramatic reversal of progress. According to the report, “By the end of 2024, Palestinian GDP fell back to its 2010 level while GDP per capita returned to that of 2003, erasing 22 years of development progress in less than two years.” Even with significant international aid, a return to pre-October 2023 economic levels is projected to take decades.
A US-brokered ceasefire between Israel and Hamas, which began in October after two years of hostilities, remains fragile. Despite the truce, violence continues. The Gaza health ministry reported on Monday that at least 342 Palestinians have been killed by Israeli fire since the ceasefire’s implementation, while Israel reports three soldier deaths due to militant gunfire in the same period.
Hostage negotiations are ongoing. Hamas and Islamic Jihad indicated on Tuesday their preparation to transfer the remains of another Israeli hostage, in accordance with the ceasefire agreement. A spokesperson for Islamic Jihad stated the body was discovered during search operations in central Gaza on Monday. Israel has criticized a delay in the handover as a violation of the ceasefire terms.
The path forward remains uncertain, particularly regarding the implementation of Donald Trump’s 20-point plan for Gaza. There is “little clarity about how the challenges of implementing the more immediate requirements…will be met, let alone longer-term questions of reconstruction.”
The current crisis was triggered by a surprise incursion into Israel on October 7, 2023, by Hamas-led militants, resulting in approximately 1,200 Israeli deaths, mostly civilians, and the abduction of 251 individuals. The subsequent Israeli offensive and ongoing strikes have led to the deaths of over 69,000 Palestinians, predominantly civilians, with thousands more still trapped under rubble.
Conditions within Gaza are dire, with Israeli military forces controlling over half of the territory since the ceasefire. The World Food Programme (WFP) reports that most Gazan households are unable to afford basic food items, despite recent price drops. Daily food consumption remains significantly below pre-war levels, with diets heavily reliant on cereals, pulses, and limited amounts of dairy and oil. A critical shortage of cooking gas has forced many families to burn discarded plastic and other materials for fuel.
Since the ceasefire began, Hamas has released all 20 living hostages and the remains of all but three of the 25 deceased hostages they were holding. In return, Israel has released nearly 2,000 prisoners and returned the bodies of hundreds of Palestinian individuals.
The UN Security Council recently endorsed Trump’s plan, which proposes an interim technocratic Palestinian government in Gaza, overseen by an international “board of peace” and supported by an international security force. The success of this plan, and the broader effort to rebuild Gaza, hinges on sustained international commitment and a lasting resolution to the underlying conflict.
