As Cairo prepares to host the Gaza reconstruction conference this month, a report by the UN Conference on Trade and Development (UNCTAD) offered shocking details on economic conditions in the occupied Palestinian territories.

According to the report, GDP growth rate dropped from 11 per cent in 2010-2011 to 1.5 per cent in 2013-2014.

Speaking to Al-Ahram Weekly, prominent Palestinian diplomat Said Kamal blamed the occupation for the economic debacle, while exonerating the policies of the oft-criticised former prime minister, Salam Fayyad.

“Those who were harmed by Fayyad’s firm handling of the economy criticise him, but Fayyad’s style is much needed,” Kamal said.

Sources at the Ramallah-based Ministry of Finance noted that the Palestinian Authority (PA) developed 400 villages in the West Bank and increased the export of agricultural products. But corruption in administrative circles undermined government efforts, sources said.

The UNCTAD report noted that conditions were particularly dire in the Gaza Strip, which has just been subject to 51 days of Israeli shelling and air attacks, during which more than 2,000 were killed and up to $9 billion in property damage caused.

It may take up to 18 years to reconstruct Gaza, experts say, noting that nearly 40,000 homes were destroyed in the recent war, as well as 141 schools, 28 hospitals, and dozens of factories. The seven-year blockade of Gaza and two earlier Israeli offensives, in 2008 and 2012, brought havoc to the Strip, even before the recent war took place.

Gaza was able to export only 182 trucks of food products in 2013, down from 15,000 trucks in 2000.

Raed Aql, a Gaza fisherman-turned-farmer, says that many inhabitants now live on relief given by UNRWA (the UN Relief and Works Agency). “There are no jobs in Gaza,” he said.

Unemployment in Gaza is believed to be around 36 per cent, compared with 22 per cent in the West Bank, said UNCTAD official Mahmoud Al-Khafif. About 80 per cent of Gaza inhabitants are currently dependent on humanitarian relief for sheer survival. Only one out of four has enough food.

“The Palestinian economy is basically a service economy that lacks a significant contribution from agriculture and industry. It therefore lacks the potential for development that comes with production,” Kamal said.

“Even the Jordanian economy, in which the Palestinians participate, is a service economy, which underlines the fact that Palestinians may have lost the experience of running a productive economy.”

According to UNCTAD, the share of construction and services in the economy is currently at 66 per cent, compared with around 10 per cent for agriculture and industry taken together.

The UNCTAD report details the increase of Israeli settlers living in Palestinian areas: in 1972 there were 800 settlers; by 2012, that number has skyrocketed to 360,000 settlers living in 100 communities. According to PA and Israeli sources, most of the settlers live in Area C, which constitutes 62 per cent of the West Bank.

The Oslo Accords divided the West Bank into three areas: Area A is under Palestinian political and security control; Area B is under PA political control, with security managed jointly with Israel; and Area C is controlled by Israel.

Israel has dedicated 39 per cent of Area C to settlements and future expansion, 20 per cent to closed military zones, and 13 per cent to nature protectorates. Palestinians are barred from building on these areas.

Over the last five years, Israel demolished a total of 2,224 structures, including homes and schools, displacing 2,417 Palestinians. In 2011 alone, about 1,000 houses under construction were demolished, according to the UNCTAD report.

Because it blocks Palestinian access to water and land, Israel’s control of Area C deprives the Palestinian economy of nearly $800 million annually (almost one-third of Palestinian GDP).

Ayman Al-Ghul, a lawyer in the West Bank, said that although there is no war in the West Bank, settler violence obstructs development. “The settlers destroy agricultural land and prevent the Palestinians by force from using any land close to the settlements, which deprives thousands of Palestinians much needed income,” Al-Ghul remarked.

Because of Israel’s restrictions, surviving in the Palestinian economy is hard for anyone, regardless of experience and talent, Kamal remarked.