The World Bank report released in September presents a stark and harsh picture of the Palestinian economy: figures that tell of a decline beyond words. The GDP has fallen to levels unseen since 2009, and per capita income has shrunk to $2,600, a decline that takes us back years of recession instead of continuing on a path of recovery.

What is happening in Gaza is more severe than statistics alone can convey. According to the report, Gaza’s GDP contracted by an estimated 83% year-on-year in the latest 2025 readings, and its contribution to the Palestinian GDP dropped from 17% before the conflict to less than 3% today.

The infrastructure suffers widespread destruction: approximately 80% of the electricity network is damaged, half of the hospitals are out of service, and 80% of students are out of the education system. These indicators coincide with a real threat to food security, with more than 640,000 people facing severe hunger. These numbers leave no room for politeness: Gaza’s economy is devastated and its people heavily reliant on aid.

Meanwhile, the West Bank recorded an apparent growth of 10% at the start of 2025, but the World Bank describes this growth as “nominal,” resulting from a low base effect after the major collapse in 2024, not real growth in production or sustainable investment.

Conversely, the labor market collapsed: unemployment rates reached 69% in Gaza and 29% in the West Bank, while the number of Palestinians working in Israel dropped from 177,000 before the conflict to about 24,000 at its worst, then partially recovered. This loss of jobs directly translated into reduced household income and increased reliance on a weak social safety net.

The financial aspect is also severe: the 2025 report clarifies that the halt of clearance transfers plunged the Palestinian Authority into a severe liquidity crisis; as a result, salaries are paid at about 70% only, while arrears accumulated and the fiscal deficit rose to significant levels (the deficit exceeded about $1.2 billion by mid-2025), while tax revenues declined by about 35% compared to the previous year. This mix puts the Authority in a position that threatens the provision of basic services and clearly increases the need for an external emergency funding flow.

To put this collapse in a clear timeline: mid-2023 indicators were worse than usual but had not reached this low; the general poverty rate was estimated at 32.8%, and in Gaza about 64%, while per capita income in the previous two years was estimated at about $3,360 per person in 2023. Compared to that, what we see in September 2025 is a sharp additional slide: general poverty approached or reached 40%, and per capita income dropped to $2,600, reflecting a significant loss in living standards in less than two years.

The private sector, which is supposed to be the engine of employment and growth, took a severe hit. Exports collapsed and supply chain disruptions led to a decline in imports as well, all accompanied by the closure of about 40% of small and medium enterprises in the West Bank alone, meaning thousands of lost jobs and erosion of the productive base. Restarting this system will not be achieved by merely injecting humanitarian funds but requires reconnecting markets and clear assurances proving the economy’s ability to operate safely.

The humanitarian dimension cannot be separated from the economic one: destruction of homes, schools, hospitals, and infrastructure damage estimated in the tens of billions of dollars makes any discussion of economic growth unrealistic. Infrastructure damage estimates alone amount to tens of billions of dollars, indicating that the reconstruction task is neither short-term nor merely economic but political and planning at regional and international levels.

Faced with this harsh picture, it is not enough to list numbers; a realistic vision is required to translate them into executable priorities that can be monitored by the Authority, civil society, and the international community. I see that exit paths must integrate on three interconnected levels:

First: restoring liquidity and opening payment channels: reactivating clearance transfers and ensuring emergency operational resources for the Authority within 6-12 months are essential to prevent collapse of basic services and full salary payments. This requires international guarantees and transparent mechanisms for disbursing funds to reassure donors and residents on the ground.

Second: urgent linkage to restart commercial activity: opening safe commercial crossings, resuming access to raw materials and fuel, and creating a temporary payment system across borders to bypass transfer restrictions with regional banks. Without this step, the private sector will remain unable to meet demand, and waves of bankruptcy and unemployment will continue.

Third: a gradual and focused reconstruction plan accompanied by governance and transparency conditions: focusing on vital infrastructure (electricity, water, hospitals, and schools) in two phases — an emergency response to restore basic services, then a medium-term reconstruction process integrating the local private sector and generating sustainable jobs. This requires an international alliance with clear oversight mechanisms to ensure funds are directed toward productive economic projects and not just temporary relief.

Finally, we must not forget the social dimension: expanding temporary social protection programs linked to vocational training to reintegrate workers into potential employment opportunities, with clear targeting programs for the poorest groups in Gaza and the West Bank. Only by integrating protection with job opportunities and reconstruction can the economic shock be mitigated.

The report presents us with one unavoidable truth: the numbers are not just administrative indicators but stories of households that lost their income source, children who lost their education, and communities needing a plan to restore their ability to live with dignity. The actual response must be swift, integrated, political, and financial simultaneously, or else we will witness a fragmented economy that only a future generation can rebuild.