Economy -Regional
Updated 2024-08-25
2023-11-23 Economic crises risk brew in shadow of Palestine-Israel conflict The war has caused catastrophic damage to Gaza’s infrastructure and economy. The United Nations Office for the Coordination of Humanitarian Affairs reports that over 1.5 million people in Gaza are now internally displaced, with around 778,000 seeking shelter in approximately 154 United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) facilities.
Further exacerbating this humanitarian crisis is a severe economic downturn. The International Labour Organization (ILO) estimates that the conflict has led to the loss of 182,000 jobs, impacting 61 percent of the labor market. Even before the conflict, Gaza’s unemployment rate was over 46 percent, one of the highest in the world.
The war’s impact extends into neighboring areas as well. In southern Lebanon, the olive trade, a key income source for many, has reached a standstill. The ongoing conflict and shelling have led farmers to abandon their harvests, resulting in the destruction of around 40,000 olive trees due to fires from Israeli Defense Forces’ shelling. The Institute of International Finance has estimated that Lebanon’s GDP may decrease by one percent by year’s end and could plummet by 30 percent in 2024 if the conflict intensifies and spills over into the region.
Regarding the assessment of the Palestine-Israel conflict’s impact on Middle East economic stability, Yu believes the key factor is whether the war has expanded. If it has, it will have a significant impact, he said. “If the conflict extends to involve countries like Iran, instability will arise on both sides of the Strait of Hormuz, leading to fluctuations in oil prices,” he explained. “While regional conflicts are improbable, should one erupt, it could spread from the Middle East to the global stage.” “At present, this seems unlikely. Iran is exercising relative restraint, and the current situation remains within control,” Yu said. https://news.cgtn.com/news/2023-11-23/Economic-crises-risk-brew-in-shadow-of-Palestine-Israel-conflict-1oY4VvCXhMQ/index.html
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