by Giuseppe Caffulli

According to the most recent estimates, the conflict with Hamas in Gaza alone has cost the equivalent of one-fifth of Israel's economy. And today, billions of dollars are being burned every week in attacks on Tehran. The paradox is that hundreds of billions are being spent on war, while little more than crumbs remain for reconstruction and development.

Milan (AsiaNews) – Since the dawn of history, war has always carried a cost — often immense, sometimes unbearable. Yet rarely has that cost reached the staggering levels seen in the conflict that has ravaged the Gaza Strip since 2023, now compounded by a new front sparked by the recent joint attack by Israel and the United States on Iran.

What is unfolding is not only a humanitarian and political catastrophe engulfing several countries in the region — a tragic confirmation of what Pope Francis already described in 2014 as a “world war fought in pieces.” It is also a vast economic chasm, an insatiable vortex consuming hundreds of billions of dollars while entire populations sink deeper into poverty.

War, once again, proves to be a devastating engine of destruction: of lives, of stability, and of the economic foundations on which societies depend.

As for the Israel-Hamas conflict, according to estimates by the Bank of Israel, the total cost of the war that began after the attack on 7 October 2023 has reached approximately 352 billion shekels, more than 110 billion dollars, practically one-fifth of the entire Israeli economy. According to financial analyses by the Bank of Israel, this figure includes direct military expenditure (approximately 243 billion) as well as funds for civilian compensation, interest on debt and internal economic interventions to support a country that is almost permanently mobilised.

The pace of spending over the past two and a half years has been staggering. During the most intense phases of the conflict, according to military economist Gil Pinchas (former economic advisor to the Chief of Staff of the Army and head of the budget department of the Israeli Ministry of Defence), the average cost was estimated at around 300 million shekels per day, almost 100 million dollars. Every rocket intercepted, every missile launched, every hour of fighter jet flight time has a sort of “list price” in the military records.

Behind these figures lies an unprecedented mobilisation. Over 300,000 Israeli reservists were called up during the first year of the war, in addition to some 170,000 permanent military personnel. The economic burden is not limited to military expenditure: it also means factories at a standstill, empty offices and slowed production.

The Israeli Central Bank itself estimates that for each reservist, approximately 38,000 shekels (just over €10,000) are lost per month in terms of economic production. These costs are set to rise, given that now, with the attack on Iran, the Ministry of Defence has called up another 100,000 reservists.

But the conflict is not only weighing on Israel's state budget. The United States has also incurred significant costs. According to a research project (Costs of War) launched in 2010 by the Watson School of International and Public Affairs at Brown University in Providence to study the human, economic, political and environmental costs of war, since 2023, Washington has provided over billion in military aid to Israel, in addition to between and billion spent on related military operations in the region, between the Red Sea and the Persian Gulf.

If we look at the consequences on the ground in the Gaza Strip alone, the economic scale becomes even more impressive. Joint estimates by the United Nations, the World Bank and the European Union indicate that rebuilding Gaza will cost at least billion and take decades.

In the Strip, where more than 2 million people still live today, 84 per cent of buildings and infrastructure (hospitals, schools, energy and water) are damaged or destroyed, with around 425,000 homes affected and 55 million tonnes of rubble to be removed.

In other words, the cost of destruction far exceeds the cost of construction. But the time it takes for weapons to wipe out entire cities is infinitely shorter than the time it takes to rebuild. This is a dynamic that is repeated in many contemporary conflicts.

The exchange of attacks and reprisals between Israel and Iran, with the direct or indirect involvement of the United States, is transforming the conflict into an increasingly costly regional confrontation.

The joint offensive by the United States and Israel against the country of the Ayatollahs has already hit thousands of military and government targets in dozens of waves of attacks. Conversely, Iranian ballistic missiles and drones have been launched at Israel; Tehran's retaliation against US military bases and strategic infrastructure linked to the United States and Western interests has affected Iraq, Qatar, the United Arab Emirates, Azerbaijan, Saudi Arabia, Kuwait, Bahrain and Cyprus.

According to estimates cited by the international news agency Reuters, open war with Tehran could cost the Israeli economy several billion dollars a week in military mobilisation, missile defence and economic slowdown. The new spiral of war has also reignited clashes on the Lebanese front, with what remains of Hezbollah, and rekindled the ambitions of the Yemeni Houthis to strike Israeli and US interests in the Persian Gulf.

In this scenario, Gaza, with its humanitarian emergencies and widespread destruction, risks disappearing. Or it risks being merely the tragic prologue to a larger plot, where geopolitical interests involving energy routes, trade corridors and control of strategic territories reign supreme.

The paradox is evident and disconcerting. While hundreds of billions are allocated to war, reconstruction and development are left with little more than crumbs. With a fraction of the money spent on weapons, we could invest in peace and prosperity, financing infrastructure, health programmes and economic stabilisation projects for millions of people.

One of the most pressing issues to be addressed in Gaza will be that of orphans, the maimed, the elderly and the post-war trauma that will affect the population for decades to come. Instead, the Middle East continues to be one of the main global markets for the military industry. It is heaven on earth for warlords who crave a conflict that feeds itself indefinitely, in defiance of any possible political solution.

 

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