Gaza is living through the worst economic crisis ever recorded, the United Nations has warned in a stark new report — with nine out of ten businesses destroyed, average income down to $0.58 a day, and a reconstruction bill that has climbed to $71.5 billion.
The report, published Thursday by the UN Conference on Trade and Development (UNCTAD) at its 73rd session in Geneva, says the collapse of Gaza’s economy is the most severe of its kind on record, wiping out decades of development in less than three years of war.
What the UN report says: the key numbers
The figures laid out in the report are staggering:
- 92 percent of Gaza’s “economic establishments” — shops, factories, workshops — have been damaged or destroyed since October 2023.
- Over 90 percent of Gaza’s working-age population is now unemployed; hundreds of thousands of jobs have been destroyed, erasing $2.8 billion in cumulative labour income across the Occupied Palestinian Territories.
- GDP per capita last year was just $212 — about $0.58 a day — an 83 percent fall since 2022, while prices are 274 percent higher than in 2022.
- Industrial activity and agricultural production have collapsed by 94 percent, with only 1.5 percent of arable land still accessible and undamaged — forcing what the UN calls “total dependence on humanitarian food aid.”
- More than 73,000 people have been killed, according to the territory’s health ministry, whose figures are regarded as reliable by the United Nations, and some 1.9 million people — nearly 90 percent of Gaza’s population — have been displaced.
“The collapse of the economy of Gaza is the world’s most severe economic crisis on record,” said Pedro Manuel Moreno, UNCTAD’s acting secretary-general. “It has wiped out decades of development and generated an acute economic crisis for its people.”
“Everyone in Gaza is now poor”
Before the war, two out of three Gazans lived in poverty. Today, the UN’s coordinator for assistance to the Palestinians, Mutasim Elagraa, says that “today, everyone in Gaza is multidimensionally poor.”
The report says 59 years of Israeli occupation imposed “structural constraints that have systemically stunted the Palestinian economy,” undermining productivity, deepening poverty and forcing dependence on aid. But since Israel launched its military offensive in October 2023 — after the Hamas-led attacks that month — the consequences have “skyrocketed,” the report says.
A patchy ceasefire announced in October 2025 has not reversed the damage. More than half of Gaza’s hospitals and clinics remain non-functional, and housing accounts for the largest share of both the physical destruction and the reconstruction needs.
The $71.5 billion reconstruction bill
UNCTAD puts Gaza’s recovery and reconstruction needs at $71.5 billion — and says that figure is likely to rise. A separate assessment by the World Bank, the EU and the UN estimated Gaza’s physical infrastructure damage at $35.2 billion and economic and social losses at $22.7 billion as of early 2026.
The report calls for “large-scale international financial and technical assistance” to rebuild agriculture, industry, construction, energy and technology. As immediate priorities, it urges transferring withheld Palestinian revenues, safeguarding the banking system, and aligning reconstruction support with the documented scale of the damage.
The West Bank is cracking too
The crisis is not confined to Gaza. The report paints an alarming picture of the West Bank, where Israel withheld clearance-revenue transfers — taxes 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 $3.67 billion, equivalent to 83 percent of the Palestinian Authority’s total net revenue in 2025. With the PA’s 2025 budget deficit reaching 13 percent of GDP, the fiscal pressure is straining essential services: health-related arrears hit $1.1 billion 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 $4.8 billion, with banks’ exposure to the public sector at $5.3 billion — 42 percent of all bank lending. “Systemic collapse is no longer a theoretical possibility,” the report warned, cautioning that banks may soon be unable to sustain essential trade flows including fuel, water and medicine. Thirty-eight Palestinian communities have been emptied since 2023 amid settlement expansion and reduced access to land.
What it means and what happens next
The UNCTAD findings put a hard economic price on a war whose human cost has dominated headlines: even if a durable peace held tomorrow, Gaza would face what the UN describes as a generational rebuild requiring massive international financing and a functioning banking system to move it.
The immediate tests are political and financial — whether withheld Palestinian revenues are released, whether banks can be stabilised, and whether donors align aid with the documented scale of damage. Without those steps, the report warns, the economic collapse will keep deepening long after the fighting stops.
What to watch next: donor responses to the $71.5 billion estimate, any movement on withheld clearance revenues, and whether Gaza’s fragile ceasefire holds long enough for reconstruction planning to begin in earnest.
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