Economic Impact of the Conflict on Israelis and Palestinians

UN Figures Show Economic Crisis Leading to ‘Human Catastrophe’ in West Bank and Gaza

New York
August 29, 2002

Releasing the first international economic statistics on the Palestinian economy since Israel reoccupied the West Bank earlier this year, the United Nations today reported that rising poverty and unemployment could spell a “human catastrophe” for the region.

West Bank cities and towns under curfews imposed by Israel in response to a wave of terror attacks have been particularly hard hit, according to statistics released by the UN Special Coordinator for the Middle East Peace Process (UNSCO). When the curfews are imposed, unemployment hits 63.3 per cent, while poverty levels have jumped to 70 per cent in the Gaza Strip.

“I am deeply disturbed by the figures,” said Special Coordinator Terje Roed-Larsen, “but I am not surprised, given the iron grip that Israel has applied to the West Bank.”

“Aid cannot fill the gap, but without it the economy would collapse,” he warned. “Against this backdrop, and before the eyes of the world, the Palestinian civilian population is scrambling to survive.”

Mr. Roed-Larsen unequivocally condemned the terror attacks by Palestinian groups that prompted Israel’s action, and reaffirmed the country’s legitimate right to self-defence. At the same time, in the face of the growing human catastrophe, he asked that Israel review the restrictions.

The envoy plans to meet with senior Israeli officials to urge them to re-examine their security measures, some of which, he argued, were not achieving their stated purpose. “Indeed, there is a grey area where legitimate defence of Israeli civilians has the de facto consequence of collective punishment for Palestinian civilians,” he said.

UNSCO estimates that the overall unemployment rate for the West Bank and Gaza Strip during the second quarter of 2002 increased from roughly 36 per cent to approximately 50 per cent. Income losses stand at $7.6 million per day, for a total of almost $3.3 billion since October 2000. The report points out that loss of income caused by closures and restrictions “far exceeds anything that the international aid community can provide.”

The UN World Food Programme (WFP) says that it will soon deliver food assistance to more than half a million Palestinians. In addition, the UN Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) has provided ongoing food aid to nearly a million refugees since October 2000. Aid money has largely shifted from projects intended to build a prosperous Palestinian State to short-term relief aimed at reducing malnutrition, epidemics and other threats.