Cairo

Source: Al-Wafd newspaper

Al-Akhbar Almsaey  newspaper

Dr. Ali Mohamed Al-Khouri, President of the Arab Federation for the Digital Economy and Advisor to the Council of Arab Economic Unity at the League of Arab States, said: The outbreak of clashes between the Hamas movement and the Palestinian factions on the one hand, and between Israel on the other hand since the seventh of last October, has caused severe anxiety in the eastern region. The Middle East and the world, due to the expansion of battles in the region and the entry of other countries into the conflict, turning it into a regional war, and with the tension of clashes on the ground, which is expected to incur significantly more economic losses on both sides, which will have a significant and direct impact on the Middle East during the coming decades.

Large economic losses in the region.

He added that the losses that are expected to result from this operation are divided into direct economic losses and indirect losses, and this will be explained as follows:

First: Direct losses: Direct losses are the losses that come as a result of the material damage resulting from the military operation. As the “Al-Aqsa Flood” operation destroyed many Israeli buildings and cities, and the Israeli occupation destroyed many buildings inside the Palestinian territories, and from here these losses can be divided into two types: Losses on the Israeli side:

One of the largest material losses for Israel is the bombing of the city of Ashkelon, which was exposed. It has dozens of bombing sites, and Ashkelon is one of the areas where Israeli oil installations are spread, which constitutes a threat to the Israeli oil project, in addition to the bombing of the second largest power station in Israel, and causing damage to the cellular communications sector.

A large fire also broke out in a complex of imported cars in the Gaza Strip as a result of missile strikes by the resistance, in addition to major damage to the infrastructure inside Israel, as some economic experts suggested that rebuilding the infrastructure in Israel would cost it at least a billion dollars, in addition to other costs. Israel is expected to bear at least $1.26 billion as a result of this operation.

Losses on the Palestinian side: The Israeli occupation army responded by causing significant material damage inside the Palestinian territories, as the Palestine Tower in Gaza was bombed, in addition to the damage caused to Al-Durrah Hospital for Children, and a rehabilitation center for people with disabilities, in addition to the destruction of more than 1,500 homes inside the Strip. Even writing that article.

Second: Indirect losses:

Decrease in the rate of tourism: The state of security instability, caused by the “Al-Aqsa Flood” operation and the “Iron Swords” occupation army operation, resulted in many foreign airlines canceling their flights to and from the occupied territories, which will result in A decrease or cessation of the number of tourists coming to Israel, which will make it bear significant losses from the decrease in the flow of foreign funds to it. Incoming tourism saves Israel 13.5 billion shekels, and the decrease in tourism revenues will cause the Israeli economy many material damages at the level of many macroeconomic indicators.

The impact of the Israeli and Palestinian budgets as a result of conflicts in the region.

High budget deficit: On the Palestinian side, the general budget suffers from a deficit estimated at 536 million dollars, which increased by 29% during the current year, and this percentage is expected to increase significantly after the “Al-Aqsa Flood” operation, as a result of the forecast. The conflict and battles extending for a long period will require debt and high deficit rates.

On the Israeli side, the budget deficit rose last June to 9% of GDP, and this percentage is likely to rise significantly after the process, which may extend for long periods. As a result of the increased spending that both parties will bear to reconstruct what was demolished.

Decrease in foreign investments: The volume of these investments reached $129.8 billion in July 2023, which suggests that Israel will lose a large portion of these investments as a result of the current process.

Increase in the size of debt: The debt percentage of the Palestinian GDP in the current year is about 58.5%, according to the expectations of the International Monetary Fund, and with these material losses that were mentioned, the debt percentage will increase significantly on the Palestinian side.
On the Israeli side, the volume of foreign debt reached $156.3 billion in July 2023, and the volume of public debt reached 60% of GDP during 2022, and it is highly expected that these numbers will increase at the end of the current process.

China and Russia are trying to calm the situation and preserve the Middle East from the expansion of the conflict.
It seems that the conflict between Israel and the Palestinian people attracted China and Russia to intervene in order to preserve the Middle East region from being drawn towards the expansion of the military conflict into a regional conflict, causing the region to turn into a fireball, returning the region to… The Middle Ages, with the destruction of all economic plans, elements of development and technology in the region, and the expansion of the cycle of poverty and hunger throughout the region for decades, with the destruction of Chinese and Russian interests in the region, which became strategic interests, whether military, industrial, energy sources, infrastructure, production projects, tourism, artificial intelligence, and many technological and economic projects. With the attempt to quarrel with the United States of America and not leave it any influence around the world, this was the Russian project that was presented to the Security Council, which was rejected by the Western powers and America’s allies. Despite this, there is a call from the Kremlin and Beijing for an immediate solution to the conflict between the two sides.

The conflict in the Middle East is turning into total destruction.

It is clear that the region is being dragged into economic destruction and livelihood deterioration, while placing it in the flames for years to come. These various scenarios established whether to displace the Palestinian people from Gaza and the West Bank to other countries will not solve the region’s social, political, demographic and economic problems, but rather will cause the wounds to deepen. The problems that have been going on for 75 years will take the region back hundreds of years, as events and battles deepen, and there are economic sectors that will collapse completely, including tourism, trade, industry, and agriculture. All of these sectors, which employ more than 50 million people in the Middle East, need stability. Political, social, economic and demographic, which has become threatened during the coming period, so everyone must realize at that moment that the world is not owned by anyone, and that everyone is partners in preserving life and human civilization, which was built over hundreds of years, and wise people and global decision-makers must intervene, In order to resolve these conflicts in the region inflamed with gunpowder that is preparing to explode, and to find a just solution to the Palestinian issue in order to close these conflicts.