Good intentions or political agendas? The Prospects of Rebuilding Gaza and the Challenges of Foreign Financing

Introduction

Most people agree that this latest war on Gaza has been the most destructive and most violent in the history of modern warfare. It is also the most difficult because it is being waged in overcrowded urban quarters with a population density among the highest in the world. It may be that the horrifying scale of destruction, and the loss of life, property and businesses masks long years of lack of development,[1] lasting through the history of a Gaza deliberately pauperized and isolated. It further hides the fact that throughout at least the last sixteen years both international and Arab aid reaching Gaza has been steadily diminishing to the point where humanitarian aid is barely adequate, and more than 80 % of the population of the Gaza Strip, some 2.3 million people, live in abject poverty. 

Discussions regarding the “next day” and the possibility of life in the Gaza Strip (if any life remains) raise many questions regarding foreign aid and international support. It is impossible at present to estimate the amount of aid needed for reconstruction while preliminary estimates indicate an urgent and immediate need for 50 billion USD, rapidly mounting with the ongoing destruction until the present time of writing. This figure exceeds what has been spent since the Oslo Accords and until now, for international donors had spent nearly 40 billion USD as foreign aid for Palestinians living in the West Bank, East Jerusalem and the Gaza Strip since the year 1993. This makes the Palestinians among the highest nations receiving non-military aid per capita in the world. That aid was marketed as development programs aimed at improving conditions held by western donors to be necessary for building peace with Israel. Nevertheless, their developmental aid failed to achieve three principal objectives set by these peacemakers: a permanent peace between Israelis and Palestinians; effective and accountable Palestinian institutions, and sustained social and economic growth (Tartir and Wildeman, 2021). 

Reconstruction needs mean first of all a massive loss of the international aid granted to Palestinians which has all evaporated with the unceasing bombardment of all that sustains life in Gaza. It also means that the present-day world, burdened with global challenges like the Covid epidemic, the many refugee crises, and the decline of global economy as a result of the Gaza war, will be forced to answer the following questions: Who will undertake to finance reconstruction? What guarantees that this massive destruction and loss will not recur? Who will determine the priorities of reconstruction? Finally, how to cope with the challenges that faced reconstruction on previous occasions, as happened for example in the 2014 war on Gaza?

The needed reconstruction; some shocking preliminary estimates

Precise figures do not exist for the amount of direct or indirect destruction unleashed by Israel upon the Gaza Strip. The losses are mounting every day, and there is almost total disruption of all essential services, a widespread collapse of infrastructure, including homes, hospitals and schools, and an almost total destruction of all economic sectors, in addition to the flight of internal investments. 

The following are some preliminary estimates gathered from several media sources:

These data pertain to the period ending December 10, 2023, and are mere estimates based upon statistics of the Government Information Office in Gaza, but these figures are likely to increase substantially as the war goes on.

In addition to these preliminary losses, there are further losses which include, for instance, the costs of removing the rubble, amounting to more than 2.5 million tons, which might require years to remove, as well as the cost of removing the remains of military ordnance. Most grievous of all are the huge losses of life, the death of experienced professionals like university professors, physicians, engineers and journalists, the grievous loss of an entire school and college year, the long-lasting effects on health of deliberate famine, and the psychological aftereffects of the war and their impact on future generations. Who can possibly shoulder the burden of such massive destruction? And how can any foreign aid cope with that very high cost?

The politicization of aid: the curse of the modern world

It would be simple minded to believe that foreign financing of development or humanitarian aid proceed merely from good intentions. It has long been the case that such financing has been linked to political agendas, obvious or hidden. Starting with the Nineties this has become even more complex and voices were raised specifically within development agencies of certain governments warning against “diverting financing”[2] for purposes other than the stated ones. Other voices were raised that claimed that when international aid is extended in the context of violent conflicts the aid becomes part of the general context and thus of the conflict itself. Although aid agencies strive on many occasions to be neutral or non-partisan, the impact of aid is not neutral and may aggravate and prolong conflict. Aid delivered during conflict cannot remain divorced from the conflict itself. (Anderson,1999)

Under such pretexts and others, many measures and means have been taken to restrict and limit financing and its means of delivery, its personnel, and the contracts signed with service providers and local partners. There are contracts which include clauses that restrict financing reaching undesirable parties, and lists are drawn up of certain individuals and their connection with so-called “terrorism”, while some aid granting agencies have been subjected to questioning by parliaments or by government bodies. In some cases, these grant agencies have had to answer before courts of law, or pay steep fines, or were forced to shut down certain programs or even close their own offices. While such practices are not related only to Palestine and the Palestinians, yet Palestine was at the receiving end of many of these restrictions and practices. The campaign against Palestinian textbooks is one example of these restrictions[3]. Another is the savage campaign against UNRWA despite the fact that this latter has adhered strictly to all necessary legal measures, and presented detailed reports of all its donors, indeed offered detailed lists every year of all its employees and its total commitment not to politicize its programs, leading to its being criticized by many Palestinians. All this, however, has not prevented the Israeli occupiers from accusing that agency on numerous occasions, nor prevented donor governments from withholding support merely because unsubstantiated rumors were raised about its activities. There are many studies that show how foreign aid is politicized, the restrictions imposed on it and how Palestinians have expressed apprehension towards, or else rejected conditional aid. But the situation in Gaza is even more destructive and savage. In any case, figures show that foreign aid to the Gaza Strip fell from a total of 2 billion USD, or 27 % of GDP in 2008 down to 550 million USD, or less than 3 % of GDP in 2022[4].

Compared to the war on Gaza in 2014, the current situation is not promising.[5] At a conference held in Cairo months after that war ended, the donors pledged 3.5 billion USD for reconstruction of Gaza over three years. The biggest pledge, 277 million USD, came from the USA with the EU pledging 348 million, Saudi Arabia 500 million and Qatar I billion. In general, the donors pledged 5.4 billion USD, that being the third time in less than six years when the international community had to undertake the tasks of reconstruction. While these pledges were generous, less than 2 % of the money was actually diverted to the Palestinians. By 2018, almost none of these pledges had been honored. Much that had been destroyed during the years 2008, 2009, 2012 and 2014 remained destroyed (Asi,2021). Widespread destruction also occurred in 2020 and 2021.

Where aid to Palestine is concerned, military conditions apply whereas aid provided to Israel by most western governments is unconditional. Military aid and trade deals, plus other forms of economic, cultural and political exchanges, enhance Israel’s occupation, illegal settlement policies and expropriation capabilities. That aid further contributes directly to defray the costs of Israel’s military onslaughts against the Palestinians while international political support protects it from the consequences attendant upon violating international law. This makes the relevant aid parties complicit in Israel’s violations of Palestinian rights. (Murad,2014) 

Catastrophic pre-war conditions

It could be argued that foreign aid to Palestine in general, and to Gaza in particular, has disappointed Palestinians and Gazans for many years. Across a span of 16 years, the Gazans have suffered from restrictions, closures, military assaults, curbing of investments and productive activities and an almost total economic collapse, in addition to an almost complete isolation from the rest of the world and from the remaining Palestinian economy in the West Bank and Jerusalem. A report by UNCTAD in 2023, prepared before the current war and published shortly after the start of the current war, pointed to this catastrophic situation. The report affirmed that for Gaza’s economy to recover from this military assault will requires financial pledges several times more than the sum needed to recover from Israel’s war on Gaza in 2014, namely, 3.9 billion USD. The report further stated that recovery would last at least seven decades unless the current situation is transformed and added that there exists a need for a fully coordinated international effort if the prewar socio-economic situation is to be restored. In other words, any financial pledges (if they were to occur) will not be sufficient unless the causes and changing circumstances which undermined and nullified foreign aid since 2006 are addressed. Foreign aid to the besieged Gaza Strip which made its population totally dependent on humanitarian assistance has contributed to limiting economic growth in Gaza. Across a span of sixteen years, Gazan economy grew by a mere 1 %, at a rate of only 0.4 % per annum. Missing was any aid that could lead to economic or institutional growth or freedom from dependence on Israeli military occupation. No political pressure was exerted which could have transformed the humanitarian and developmental conditions necessary to provide the minimum level needed for existence. 

In addition to the suffocating Israeli restrictions on institutions and vital sectors in the Gaza Strip under the pretext of “preventing the transfer of financing” and turning the population into a permanent state of reliance on aid, the aid itself was almost completely subjected to constant Israeli pressure as regards what is or is not allowed into Gaza under the pretext of “double use”[6]. This last was a list of astonishing or ludicrous items and yet none of them was ever challenged by the donor parties. All these donors could do was to beseech Israel to allow what could enter and not to disrupt a process that everyone imagined was the only solution to help the besieged population in the Gaza Strip.

Since the start of the October 7 war, the population of Gaza and the rest of the world are wondering about the abject failure of international bodies and foreign grant agencies to deliver aid to a population all of whom are facing starvation. However, this failure is a natural consequence of years of submissiveness to Israel’s diktats and a lack of will among donors to press for a regular flow of humanitarian aid, or for developmental aid, or for a peace settlement. In other words, the reality on the ground in Palestine is witnessing an abject failure of the “tripartite relationship” which donors throughout the world strive to achieve.[7]

Conclusion

Reconstruction of the Gaza Strip is inconceivable without foreign financing. The population of Gaza need this not only because of the massive destruction brought about by the Israeli army, but also to compensate them for long years of impoverishment, lack of development and the systemic destruction of all that makes life possible. However, this financing cannot continue to submit to current Israeli restrictions and cannot persist without political support for Palestinian aspirations to be free from occupation and recognition of the legitimate right of Palestinians to establish their own state which embodies their ambitions and hopes. Again, reconstruction cannot commence under the shadow of a siege and the constant restrictions and monitoring of what enters Gaza for reconstruction purposes, nor can it commence under the shadow of an Israeli occupation that shirks its responsibilities as an occupying power, refuses to acknowledge responsibility for the vast destruction it has caused, and all the while hugely wasting the resources of the entire human race and not simply those of Gaza. The donor parties should exert their political pressure to remain true to their humanitarian and legal ideals and not to continue with a reconstruction that runs in a vicious cycle. 

Reconstruction cannot be complete without a full and effective partnership with the Gazans and Palestinians built upon international standards of accountability and working according to a national agenda that reflects the true needs of the population. This in turn requires consensus regarding national demands and not simply unconditional acceptance of all types of support, and further requires avoidance of falling into the trap of diktats and of unjust and unrealistic conditions. The flow of foreign aid is the right of any people whose capabilities have been frittered away through many long years, but acceptance of any financing should adhere to a clear national decision and not simply welcoming any and all aid.

References:

• Anderson, Mary (1999). Do No Harm: How Aid Can Support Peace-or War. Boulder, CO: Lynne Rienner Publishers Inc.

• Asi, Yara. “Rebuilding Gaza, Yet Again”. Arab Center Washington DC., 17, June, 2021.

• Murad, Nora Lester. (2014, October). “Donor Complicity in Israel’s Violations of Palestinian Rights.” Al-Shabaka Policy Brief.

• Tartir, Alaa and Jeremy Wildeman(2021). Political Economy of Foreign Aid in the Occupied Palestinian Territories: A Conceptual Framing. Switzerland: Palgrave Macmillan.

• UNCTAD, (2023). “Report on UNCTAD assistance to the Palestinian people: Developments in the economy of the Occupied Palestinian Territory.” TD/B/EX(74)/2.

• UNCTAD (2024). “Economic Impact of the Destruction in Gaza and Prospects of Economic Recovery.” Preliminary Assessment, January 2024.

[1] لمزيد عن إجراءات الإفقار واللاتنمية انظر/ي كتاب سارة روي: "قطاع غزة: السياسة الاقتصادية للإفقار التنموي" (بيروت: مؤسسة الدراسات الفلسطينية، 2018)

[2] يتم تعريف تحويل التمويل على أنها المساعدات التي يتم أخذها أو سرقتها أو إتلافها من طرف أي سلطة حكومية أو محلية أو جماعة مسلحة أو أي جهة فاعلة أُخرى مماثلة. ويُعتبر مثل هذا الفعل مساعدات محولة حتى لو تم إعادة توزيع المساعدات على أشخاص آخرين محتاجين غير المجموعة المستفيدة المقصودة.

[3] “PCHR Condemns Israeli Authorities’’ Attempts to Impose Distorted Version of Curriculum in Occupied Jerusalem Schools”, IMEMC News, 21/9/2022.

[4] UNCTAD, “Report on UNCTAD assistance to the Palestinian people: Developments in the Economy of the Occupied Palestinian Territory’, TD/B/EX(74)/2 (2023).

[5] استخدمت مقاربة حرب 2014 لتوقع المستقبل فقط، إذ إنها الحرب التي تم بعدها عقد مؤتمر للمانحين لإعادة الإعمار، ولأنه لم يتم الوفاء بهذه الالتزامات بعد 10 سنوات من الحرب، وهو ما يعطينا تصوراً عن المخاطر المتوقعة في أي محاولة لإعادة إعمار غزة 2024.

[6] لمزيد من المعلومات، انظر:

Dual-Use Lists, Office of the Quartet.

أو انظر:

“Controlled dual – use items.” Gisha: Legal Center for Freedom of Movement.

[7] "العلاقة الثلاثية" مصطلح يُستخدم للتعبير عن الروابط المتبادلة بين قطاعات العمل الإنساني والتنمية والسلام. ويشير على وجه التحديد إلى المحاولات في هذه المجالات للعمل معاً لتلبية حاجات الناس بشكل أكثر فعالية، والتخفيف من المخاطر ونقاط الضعف، والتحرك نحو التنمية المستدامة.