Key takeaways
- The U.S.-backed Board of Peace unveiled a six-month, $2.45 billion, 66-project starter plan for Gaza on September 23, 2026 — with no start date attached.
- The UN trade body UNCTAD puts total recovery and reconstruction needs at $71.5 billion, calling Gaza's economic collapse the "most severe crisis on record."
- The ceasefire that was supposed to unlock rebuilding has largely stalled: Israel now occupies about 60% of Gaza, Hamas has not disarmed, and neither the international stabilization force nor a new Palestinian administration has entered the territory, according to the Associated Press.
- Before a single building goes up, the UN says more than 60 million tons of rubble must be cleared — a job that will take seven years, plus demining.
Contents
- The scale of destruction: Gaza's economy in numbers
- Gaza reconstruction: the Board of Peace's $2.45 billion starter plan
- Why nothing has started: the stalled ceasefire
- Clearing the rubble: the decade-long job
- What to watch
Two years of war have left Gaza's economy in ruins, its streets buried in rubble, and its population almost entirely dependent on aid. Gaza reconstruction is priced, planned on paper, and internationally endorsed — but on the ground, rebuilding has not begun. This explainer covers the damage assessments, the reconstruction plans, and the political blockages keeping bulldozers idle.
The scale of destruction: Gaza's economy in numbers
In September 2026, the UN Conference on Trade and Development (UNCTAD) delivered a stark verdict: Gaza's economic collapse is the world's "most severe crisis on record," measured by the peak-to-trough fall in real GDP per capita and the projected duration of recovery.
- 92% of Gaza's economic establishments — the workshops, factories and businesses capable of generating jobs and income — are now damaged or destroyed.
- Gaza's real GDP per capita stood at just $212 in 2025, or $0.58 per person per day — about 17% of its 2022 level.
- More than 90% of the working-age population is without work; only about 123,300 Gazans were employed in 2025.
- Agricultural and industrial output each fell 94% compared with 2022; construction output collapsed by 99%.
- Prices stood 274% above 2022 levels in 2025, with staple foods spiraling — potatoes, for example, cost more than 20 times their pre-war price.
UNCTAD's acting secretary-general, Pedro Manuel Moreno, told reporters in Geneva that recovery and reconstruction needs had reached $71.5 billion by early 2026 and warned the figure would keep rising until a sustainable ceasefire is achieved: "Peace cannot be built on a collapsed economy."
The same joint assessment put physical infrastructure damage at $35.2 billion — more than two and a half times the pre-war real GDP of Gaza and the West Bank combined — alongside $22.7 billion in economic and social losses. Housing accounts for the largest share of damage; more than half of hospitals and clinics remain non-functional; 93% of schools require comprehensive reconstruction; and less than 1.5% of cropland remains accessible, leaving the population almost totally dependent on humanitarian food aid.
Gaza reconstruction: the Board of Peace's $2.45 billion starter plan
The body tasked with turning those numbers into action is the Board of Peace, the U.S.-backed organization overseeing ceasefire implementation and reconstruction in Gaza. On September 23, 2026, its governors met in New York on the sidelines of the UN General Assembly and unveiled a six-month, $2.45 billion blueprint: 66 projects spanning infrastructure, education and health, designed to support President Donald Trump's 20-point plan to end the Israel-Hamas war.
The board was frank about the limits of its own proposal. "The need is immense," it said, estimating that repairing Gaza's physical damage will cost roughly $35.2 billion over the medium term and another $71.4 billion over the following ten years. The proposal is aimed squarely at potential donors, who will be asked to foot the bill for a territory whose would-be funders have been burned by failed peace initiatives before.
The board's high representative, Nikolay Mladenov, has said progress hinges largely on Hamas disarming — a step the group has refused to take — while also pressing Israel to scale back its military operation.
"I want to be very clear that we are not bound by a calendar. We want to make sure that this works." — Nikolay Mladenov, the Board of Peace's high representative
Donor money is, in principle, on the table. In July 2026, the European Union coordinated €900 million ($1 billion) in pledges for Gaza's rebuilding at a meeting of the Palestine Donors Group in Brussels. But as the Associated Press noted, how much of that money will actually be delivered — and when reconstruction can begin — remains unclear. "The ceasefire in Gaza remains fragile, and the situation on the ground for civilians is not getting better," said European Commissioner for the Mediterranean Dubravka Šuica.
Why nothing has started: the stalled ceasefire
The ceasefire, which took effect on October 10, was meant to clear the way for a broader process: further Israeli military withdrawals from Gaza, the disarmament of Hamas, the arrival of an international peacekeeping force, a new apolitical Palestinian government to run day-to-day affairs, and then the rebuilding program. (For the ceasefire's trajectory in detail, see our explainer on [the stalled Gaza ceasefire](/articles/2026-09-27-gaza-death-toll-ceasefire-stalls).)
Nearly a year later, the Associated Press reports that the plan has largely stalled. The Israeli military has expanded its control and now occupies some 60% of the territory. Hamas has not given up its weapons. The international military force and the new government have not entered Gaza. Reconstruction has not begun. The vast majority of Palestinians continue to live in tent camps or in the ruins of their former homes.
Security arrangements remain the thorniest question. U.S. General Jasper Jeffers, commander of the planned international stabilization force, has outlined a five-step approach to demilitarizing Hamas: a first wave of multinational troops from Kosovo and Morocco, followed by additional personnel from Albania and Kazakhstan, tasked with demilitarizing the territory and decommissioning all of Hamas's military infrastructure. The goal is to gradually hand security control to the interim government — after which Israel would be expected to withdraw its forces.
On the civilian side, the new Palestinian committee meant to administer Gaza's daily affairs, headed by Ali Shaath, is still unable to even enter the territory, the AP reported in July 2026. The Palestinian Authority, led by Prime Minister Mohammad Mustafa, is seeking a role in reconstruction, but the U.S. 20-point plan only references the possibility of a future Palestinian state — opposed by Israel's current government.
Clearing the rubble: the decade-long job
Even if the politics resolved tomorrow, physics stands in the way. The United Nations has said Gaza holds more than 60 million tons of rubble — enough to fill nearly 3,000 container ships. Clearing it will take over seven years, with additional time needed for demining, the AP reported. Unexploded ordnance is embedded in the ruins, and clearance will require specialized demining capacity before large-scale construction — above all housing, the largest single category of damage — can safely begin.
What to watch
Disarmament: Mladenov has made clear that nothing in the Board of Peace's plan advances without Hamas giving up its weapons. Withdrawal and deployment: the sequenced choreography of Israeli pullback, international force deployment and the entry of a civilian administration has yet to begin. Money: $1 billion in EU-coordinated pledges and a $2.45 billion starter plan are down payments on a bill the UN puts at $71.5 billion — and donors will not write the big checks until the first two variables move.
