Israel’s war on Gaza deepens economic crisis in the West Bank

Israel’s 23-month war on Gaza has not only left many killed and injured but has also devastated the Palestinian economy. The conflict has heavily impacted the occupied West Bank, where Israel’s military campaign is strangling economic life and undermining workers’ livelihoods, Radio France Internationale (RFI) reported on September 21st.

As settlements expand at unprecedented speed, many Palestinians are being displaced from their land, making it increasingly difficult to sustain any form of work. The West Bank, fragmented by checkpoints and Israeli military posts, has seen the time waiting in checkpoints soar. Oxfam estimates that the hours lost at checkpoints amounts to a $17 million monthly loss for Palestinians.

Since the October 7th, 2023 attacks, Israel has also imposed sweeping punitive measures. A total of 150,000 Palestinians previously employed inside Israel had their work permits revoked. Just 8,000 permits have since been reinstated. In addition, thousands of civil servants are unable to claim their salaries after Israel froze a portion of revenues owed to the Palestinian Authority.

Unemployment in the West Bank has increased twofold since October 2023, reaching nearly 35%. Poverty now affects close to 30% of the population—up from 28% in 2024 and just 12% in 2023.

This worsening economic crisis reflects a deeper political shift. Prime Minister Benjamin Netanyahu has also declared: “There will not be a Palestinian state,” while simultaneously announcing a large-scale settlement expansion campaign in the occupied West Bank.

Such declarations mark a complete reversal of the peace process launched with the Oslo Accords of 1993. Israel’s current government—the most right-wing in its history—includes ultra-religious ministers who, citing scripture, claim sovereignty over the entire Palestinian territory. Meanwhile, Israel’s once-significant peace camp, long supportive of a two-state solution, has eroded into a small minority.

The October 7th attacks further accelerated this political trajectory. A number of western states have already recognised Palestine, placing Washington directly at odds with much of the international community.