(MENAFN) Gaza is enduring the most severe economic breakdown in its history following two years of conflict between Israel and Hamas, which have left the Palestinian territory in devastation, according to a report by the UN Conference on Trade and Development (UNCTAD).

The UN trade agency stated this week that Gaza’s GDP in 2024 plummeted by 83% compared to the previous year, while GDP per capita dropped to $161 annually—less than 50 cents per day—ranking among the lowest worldwide.

UNCTAD estimates that the territory’s economy has contracted to just 13% of its 2022 scale, with inflation soaring to 238%, unemployment approaching 80%, and all 2.3 million residents now living below the poverty threshold.

“The post-October 2023 military operations have destroyed the economic foundations of Gaza and propelled it from de-development to utter ruin,” the report stated. It further highlighted that the crisis has erased 69 years of advancement, plunging the region’s economy into “the most severe crisis ever recorded.”

The report also noted that approximately 70% of Gaza’s buildings have been damaged, and reconstruction efforts will require at least $70 billion and several decades to complete.

The prolonged fighting and ongoing restrictions have also caused a sharp downturn in the broader Palestinian economy, with the West Bank experiencing its most severe economic decline on record, UNCTAD added.

Israel initiated its military campaign in Gaza in response to a surprise Hamas attack in October 2023, which resulted in 1,200 fatalities and 250 hostages.

According to Gaza’s Hamas-run health authorities, subsequent Israeli operations have killed more than 69,500 Palestinians.

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