A UN report warned of the rise of unemployment rates to rates exceeding 50% in Gaza Strip by mid 2008 in case the current confrontations and conditions persist. The following report is published by UN OCHA:

The Closure of the Gaza Strip: The Economic and Humanitarian Consequences
Key Observations: Since June 2007, in response to the Hamas take over of the Gaza Strip and the on-going and indiscriminate firing of rockets into Israel, the Government of Israel (GoI) has increased restrictions on access of goods and people to and from Gaza. These have severe consequences for the day-to-day life of the 1.48 million Gazans.

Since then:
* More Gazans than ever need food and direct assistance
* Fuel shortages have threatened essential services and water supply
* Life-saving treatments are not available in Gaza’s hospitals
* 17 per cent of patients with referrals were refused exit for treatment in Israel, East Jerusalem or overseas
* The on-going isolation of Gaza threatens the local economy
* Baby milk, medicines, and cooking oil are increasingly scarce
* Hundreds of businesses have gone bankrupt due to ban on imports/exports
* Thousands of labourers have lost their jobs due to the collapse of the building industry
* Building projects worth US$370 million are on hold indefinitely

The isolation of the Gaza Strip has lasted six months, leaving the local economy to possibly face irrevocable damage and the population in Gaza more reliant on aid than ever before. If the closures are not eased, the UN predicts the need for food and direct assistance will sharply rise above and beyond the current level of 80 per cent of the population.

Tight controls are imposed on all Palestinian access in and out of the Gaza Strip, including those with permission to seek essential medical treatment in Israel, East Jerusalem or overseas.

Severe shortages and restrictions on imports and exports are already beginning to distort markets in the Gaza Strip, putting anything other than the most basic goods and foods beyond the buying power of a large portion of the population. Low stock levels, rising prices, increased joblessness and loss of incomes are having devastating consequences for the population and local economy and the livelihoods of the people of Gaza.

All sections of the population have been affected by a reduction in fuel supplies which undermines the delivery of essential services. The current strain will be exacerbated if the GoI fully implements its decision to further reduce fuel imports and restrict Gaza’s electricity supplies.

HUMANITARIAN IMPACT

Lack of Food
No goods other than basic foods and medicines are being allowed into the Gaza Strip and supplies of many stocks that are not considered absolutely essential are fast running out. WFP estimates that only approximately 41 per cent of humanitarian and commercial food import needs were met between 1 October and 4 November 2007. Basic items including wheat grain, vegetable oil, dairy products and baby milk are in extremely short supply.

Prices of many items have increased sharply since July 2007 as a result of shortages, although local fruit and vegetable prices have dropped dramatically due to the export freeze and the ‘dumping’ of export items by producers onto the local markets.

Poverty, unemployment and lack of cash flow have put many prices – even those for local fruit and vegetables which have decreased - out of the reach of a large section of the population. According to WFP, of the 62 per cent of households who stated a drop in spending, 93.5 per cent cut back on food buying overall, leading to a 98 per cent reduction in the purchase of meat and an 86 per cent fall in the purchase of dairy products.

Incomes Down, Unemployment Up
Unemployment is set to rise above 50 per cent in the Gaza Strip by the middle of next year, if current trends continue. Joblessness in the Gaza Strip stood at 37.6 per cent in the third quarter of 2007, compared to 32.3 per cent in the second quarter and overall unemployment is 12 per cent higher in the Gaza Strip than in the West Bank.

A rapid assessment by WFP in October 2007 on non-refugee households found:

* More than one in five households reported a drop in income compared to before the mid-June closure
* 14 per cent of the surveyed households have one family member who lost his/her job in the past four months
* 58 per cent of those who have recently lost their jobs are allegedly the main breadwinners of the family

Latest figures show poverty in the Gaza Strip has already reached unprecedented levels with around eight out of ten households living below the poverty line of 2,300 NIS (US$594) per household per month (a sharp rise compared to the 2005’s rate of 63.1 per cent). Of these, 66.7 per cent of Gazan households are living in deep poverty, i.e. on less than 1,837 NIS or US$474 per month.5 Poverty levels are 30 per cent higher in the Gaza Strip than the West Bank.

As a consequence, more Gazans than ever are almost entirely dependent on food aid and direct assistance: 80 per cent of Gazan families currently receive humanitarian aid (compared to 63 per cent in 2006).

Drop in Healthcare Standards
Many specialised and life-saving medical treatments are not available in government hospitals in the Gaza Strip. Chemotherapy and radiotherapy for cancer patients, paediatric surgery and neurosurgery are among the treatments that are only available beyond Gaza’s borders in Israel, East Jerusalem or overseas. However, the current measures imposed by Israel have prevented a number of patients with referrals from leaving the Gaza Strip for treatment. Since June, 713 patients out of 4,074 applicants (17.5 per cent) have been denied permits to cross into Israel for medical treatment.

The standard of healthcare in the Gaza Strip is deteriorating rapidly. The majority of diagnostic laboratory equipment, for example MRI and x-ray equipment, at Ministry of Health facilities are no longer functioning, and cannot be repaired due to the inability to import spare parts.

Water Shortages
Water wells and pumping stations serving more than 750,000 people throughout Gaza require urgent repair which cannot be carried out due to lack of spare parts. Beginning of December, the Israeli-imposed restrictions on fuel imports to the Gaza Strip, additional reductions caused by the Palestinian Authority’s inability to meet its payment schedule as well as a strike by the Gaza petrol associations in response to the restrictions, resulted in 15% of the population receiving only 1-2 hours of water supply per day.

For full report: http://www.ochaopt.org