Impact of Israel-Palestine Conflict on Global Economic Relations

Abstract

The Israel-Palestine conflict, rooted in competing nationalist claims and shaped by historical events like the Balfour Declaration and UN partition plan, has driven decades of territorial, political, and economic challenges. This chapter will analyze how wars following Israel's establishment expanded its territory and displaced Palestinians, entrenching socio-economic issues such as high unemployment, restricted trade, and aid dependency in Palestinian regions. Israel's defense spending strains its economy, while instability disrupts regional trade, tourism, and investor confidence, impacting global supply chains in energy and minerals. Economic strategies, including corporate investment in regional infrastructure and renewable energy, alongside initiatives supporting Palestinian development, can promote stability. The chapter concludes by focusing on diversified supply chains and collaborative projects, as well as global and regional stakeholders that can address economic and political dimensions of the conflict, with the hope of long-term peace.