Prospects dim for post-war Palestinian economic recovery

Al-Monitor Pro Members

David Rosenberg

Israeli reporter specializing in business, economics and politics

Jan. 2, 2024

The war in Gaza has taken a severe toll on the Palestinian economy, principally in the Gaza war zone but also in the West Bank where Israeli measures have brought economic activity to a standstill. The medium-term outlook for the Palestinian economy hinges on a reconstruction plan for Gaza and an Israeli decision to restore pre-war economic ties with the Palestinians. Neither development appears promising. Donor countries are unlikely to cover reconstruction costs without an acceptable governance arrangement in Gaza and a political horizon that reduces the risk of another war. For the foreseeable future, aid money will cover basic humanitarian needs, leaving the enclave in economic distress. The West Bank’s crucial economic ties in Israel will remain constrained as long as a right-wing government remains in power in Israel.