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IMF and World Bank warn of renewed Gaza violence

THE LEVANT – The World Bank and International Monetary Fund warned Tuesday that insufficient funding and political efforts to rebuild Gaza would make economic recovery almost impossible and lead to further violence.

The warnings came three weeks after Israel and Hamas signed a ceasefire to end 50 days of conflict, and as the Israeli army said a mortar fired from Gaza hit southern Israel — the first since the truce.

“Without immediate action by the Palestinian Authority, donors and the government of Israel to revitalise the economy and improve the business climate, a return to violence as we have seen in recent years will remain a clear and present danger,” the World Bank quoted Palestinian territories director Steen Lau Jorgensen as saying in a statement.

And the IMF, in a report published Tuesday, mostly borrowing from statistics collected before the war, called for international efforts to alleviate an eight-year Israeli-imposed blockade.

Israel’s blockade has restricted and sometimes entirely prevented certain building materials from entering Gaza, with the Jewish state saying they could be used by militants to make weapons or build attack tunnels.

The IMF said the war’s economic impact was difficult to evaluate, but that the level of destruction and limited resources in Gaza required a “fundamental change of the political status quo,” and significant provision of international aid.

It said if Israel’s blockade on Gaza was not lifted, partially or entirely, including allowing in building material, reconstruction efforts could fail.

The UN and the Palestinian government have called for $551 million (425 million euros) in humanitarian aid, ahead of an October 12 Gaza donor conference in Cairo.

The cost for full reconstruction of homes and infrastructure destroyed during the war is estimated at $7.8 billion (6.0 billion euros) by the Ramallah-based Palestinian Economic Council for Development and Reconstruction.

Gaza’s economic situation was precarious well before the latest conflict, with 45 percent unemployment and 63 percent youth unemployment in the second quarter of 2014, the IMF said.

The 50-day July-August operation by Israel’s army in Gaza killed at least 2,100 Palestinians, and the UN said it made some 100,000 people homeless in the long term.

On the Israeli side, 73 people died.

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