Gaza’s recovery needs reach $71.5bn amid ‘most severe economic crisis’: UN

Gaza’s recovery and reconstruction needs have reached an estimated $71.5bn and are likely to increase, according to the latest United Nations Conference on Trade and Development (UNCTAD) report.

Gaza’s economy has experienced the world’s “most severe crisis on record”, said the report presented at UNCTAD’s 73rd session on Thursday.

It said that 59 years of Israeli occupation have “imposed structural constraints that have systemically stunted the Palestinian economy”, undermining productivity, deepening poverty and forcing dependence on aid.

But since Israel launched its genocidal war in October 2023, the consequences of the occupation have “skyrocketed”.

Israel’s “intense” military operations have damaged or destroyed 92 percent of economic establishments across Gaza since the war began. Unemployment has surged, with over 90 percent of Gaza’s working-age population unemployed, the report said.

At the same time, hundreds of thousands of jobs have been lost across the Occupied Palestinian Territories, erasing $2.8bn in cumulative labour income, it added.

Gaza’s GDP per capita last year was $212 ($0.58 a day) – an 83 percent decrease since 2022, it said.

A separate assessment by the World Bank, EU and UN put Gaza’s physical infrastructure damage at $35.2bn and economic and social losses at $22.7bn as of early 2026, with the $71.5bn reconstruction estimate “likely to increase”, according to UNCTAD.

Housing accounts for the largest share of Gaza’s damage and reconstruction needs, while more than half of hospitals and clinics remain non-functional and less than 1.5 percent of cropland remains accessible and undamaged.

The report said the damage requires “large-scale international financial and technical assistance” to rebuild agriculture, industry, construction, energy and technology, and called for transferring withheld Palestinian revenues, safeguarding the banking system and aligning reconstruction support with the documented scale of damage as immediate priorities.

Israel withholds funds as West Bank in crisis

Israel withheld clearance revenue transfers – collected on the Palestinian Government’s behalf under the Paris Protocol, an arrangement the report notes is “over 27 years past its expiry date” – from May 2025 through mid-2026.

Cumulative deductions and withheld revenues between 2019 and March 2026 exceeded $3.67bn, equivalent to 83 percent of total Palestinian net revenue in 2025.

With the Palestinian Authority’s 2025 budget deficit reaching 13 percent of GDP, the fiscal pressure is straining essential services: health-related arrears hit $1.1bn by late 2025, threatening hospitals and pharmaceutical suppliers, while resource shortages forced West Bank schools to limit in-person instruction to three days a week.

Public debt has reached $4.8bn, with banking-sector exposure to the public sector at $5.3bn, or 42 percent of all bank lending.

“Systemic collapse is no longer a theoretical possibility,” the report warned.

“Banks may soon be unable to sustain essential trade flows, including fuel, water and medicine, and stabilising the financial system and developing a sustainable cross-border payments framework is an urgent priority.”

Separately, the report documents reduced Palestinian access to land amid settlement expansion, with 38 communities emptied since 2023 and first-quarter 2026 displacement already exceeding all of last year.