The turbulent landscape of the Israeli-Palestinian conflict is marked by tens of thousands of casualties and the displacement of millions over seven decades. To understand the current situation, it is imperative to first acknowledge the context that continues to shape this enduring conflict.
Israel has declared war on the Gaza Strip, launching a bombing campaign, with over 700 Palestinians reported dead and more than 4,000 injured.
This escalation followed an unexpected attack on Israel by the Palestinian Islamic Resistance Movement (Hamas) on October 7, during which parts of the heavily fortified separation fence that separates Gaza from the rest of the country were breached, and settlements along the Gaza border were targeted.
What is the background of the conflict in Gaza?
Gaza is home to 2.3 million Palestinians, with nowhere to flee. The city is an enclave on the eastern coast of the Mediterranean Sea, bordered by Egypt on the southwest and Israel on the east and north.
According to B’Tselem, an Israeli human rights organization dedicated to documenting and reporting human rights violations committed by Israel in the Occupied Territories, “Israel has turned the Gaza Strip into the largest prison on earth, while at the same time renouncing responsibility for the lives and welfare of its residents.”
Since 2007, Israel has enforced a continuous land, air, and sea blockade on Gaza. Human Rights Watch has reported that “this closure has devastated the economy in Gaza, contributed to the fragmentation of the Palestinian people, and forms part of Israeli authorities’ crimes against humanity of apartheid and persecution against millions of Palestinians.”
Israel exercises control over crucial aspects of life in Gaza, including the movement of food, water, and people through land crossings connecting Gaza to the outside world. Palestinians are not permitted to operate an airport or a seaport in Gaza, leading to significant implications for their ability to travel or engage in foreign trade.
This 16-year-old blockade has been criticized by human rights organizations as a form of collective punishment against the Palestinian people. This perspective is echoed by Israeli Defence Minister Yoav Gallant, who stated in a video statement on Monday, October 9: “We are putting a complete siege on Gaza … No electricity, no food, no water, no gas – it’s all closed.”
This collective punishment puts Gaza on the brink of a new humanitarian crisis, as trapped Palestinians, who are not part of the conflict, run out of water, in addition to food, fuel, and electricity.
Economic and political impact on Israel
The latest conflict has had a significant impact on the Israeli stock market. Tel Aviv’s primary stock indices, including TA-125 and TA-35 indices, experienced a nearly 7 percent decline. Banking stock, represented by the TELBANK5 index, was especially affected, with a 9 percent drop in sales totaling USD 573 million. Additionally, government bond prices decreased by up to 3 percent in the initial market response to the attack on Israel.
Furthermore, Nvidia, the world's leading producer of chips used in artificial intelligence (AI) and computer graphics, announced the cancellation of an AI summit scheduled to be held in Tel Aviv next week.
Meanwhile, the state of affairs has exerted a substantial influence on the domestic political landscape of Israel. Prime Minister Benjamin Netanyahu and the opposition leader Yair Lapid engaged in discussions about forming an emergency government in response to the massive attack.
These discussions were prompted by the prime minister’s resistance to addressing the protests and numerous duty-related strikes carried out by Israeli voluntary reserve soldiers and others. These protests were primarily in opposition to legal reform that aimed to restrict the judiciary's powers.
The international response to the attack has led to the emergence of distinct perspectives. The first has condemned the attack and expressed total support for Israel. The second perspective, in contrast, has called for calm and de-escalation. Others, on the other hand, emphasized the importance of not confusing Hamas with all Palestinians.
The key stakeholders in this conflict involve neighboring countries, including Lebanon, which has already been drawn into the conflict through Hizbollah, Egypt, Saudi Arabia and Jordan. Iran is allegedly involved in the current events, although it has denied this, and described the Hamas attack as self-defense. The USA and the European Union (EU) play significant roles as major funders to Israel and, to a lesser degree, Palestine.
The USA has deployed military ships and aircraft closer to Israel as a show of support. Meanwhile, the European Commission declared its support to Israel but later reversed a decision to suspend aid to Palestinian authorities because of the overwhelming majority support by member states.
How do the ongoing events impact the MENA region?
While President Biden vowed support to Israel and called the Hamas attack an act of “sheer evil,” his top aides, according to the New York Times, “have been scrambling to reaffirm their commitment to the idea of potential normalization of diplomatic ties between Saudi Arabia and Israel, even as Israel prepares for the start of a full-scale war against Palestinian militants.”
The potential normalization of diplomatic ties between Israel and Saudi Arabia brokered by the USA is partly motivated by concerns about regional competition with Iran. Saudi Arabia aims to acquire advanced weaponry to enhance its regional influence and security, particularly in light of Iran’s capabilities.
However, the agreement also involves concessions on the Palestinian issue.
Nevertheless, the recent Hamas attack has unveiled a deep-seated anti-Israel sentiment among Palestinians, whose well-being has been consistently disregarded by the international community, particularly during the normalization talks.
As a result, Hamas’ recent attack has raised questions about the effectiveness of sidelining the Palestinian issue in favor of establishing closer ties between Israel and Arab nations. It has also challenged the United States’ diplomatic approach to autocratic regimes and the potential stability in the region.
Moreover, the counterattack of Israel might cause a mass refugee movement from Gaza to the Sinai Peninsula of Egypt, which is something that Egypt may not want to happen from a security perspective.
For years, Egypt has imposed strict limitations on the activities of the Muslim Brotherhood, aka Ikhwan, designating the organization as a terrorist group. It is worth noting that the Ikhwan shares the same ideology as Hamas, the de facto governing entity of the Gaza Strip.
The potential influx of refugees may encompass individuals affiliated with the Muslim Brotherhood, raising concerns about the stability of the Sinai Peninsula, a region where Egypt has been engaged in prolonged battles to counter terrorism since 2013.
The ongoing conflict between Israel and Hamas, much like the broader Israeli-Palestinian struggle, is deeply entrenched in national and international geopolitical dynamics.
To truly grasp the situation, we must consider the broader context of the daily hardships faced by Palestinians in Gaza who have endured a 16-year-long crippling blockade, resulting in dire living conditions and economic devastation. This blockade has effectively turned Gaza into what some describe as the world's largest open-air prison. Moreover, Palestinians in general face the relentless challenges of living under the weight of an apartheid system.
These recent events underscore the urgent need to address the fundamental rights of Palestinians, which have been persistently overlooked by international policymakers. Achieving a lasting solution to the Palestinian-Israeli conflict demands the recognition of Palestinians’ historical rights in their indigenous lands and their status as equal citizens. It also entails putting an end to the illegal settlement activities.