Findings by the UN Conference on Trade and Development point to the eight years of economic blockade of Gaza as well as the three wars between Israel and the Palestinians over the past six years.
The 2014 war displaced half a million people and left parts of Gaza destroyed.
War “has effectively eliminated what was left of the middle class, sending almost all of the population into destitution and dependence on international humanitarian aid”, the new report says, according to the Associated Press.
Gaza’s GDP dropped 15% in 2014 and unemployment reached a record high of 44%, while 72% of households were food insecure.
The wars had shattered Gaza’s ability to export and produce for the domestic market and left no time for reconstruction, the report said. It noted that Gaza’s “de-development” had been accelerated.
Israel and Egypt have maintained a blockade of Gaza since 2007, when Hamas took control of the strip after winning legislative elections.
The report comes as Egyptian military bulldozers press ahead with a project that effectively would fill Egypt’s border with the Gaza Strip with water and flood the last remaining cross-border underground smuggling tunnels, which have brought both commercial items and weapons into Gaza.
The report calls the economic prospects for 2015 for the Palestinian territories “bleak” because of the unstable political situation, reduced aid and the slow pace of reconstruction.