* Rebuilding 17,000 homes razed by Israeli bombings $2.5 bln
* Scale of destruction unprecedented - Palestinian Authority
* Cash-strapped PA says foreign aid needed
By Noah Browning
RAMALLAH, West Bank, Sept 4 (Reuters) - Rebuilding Gaza will cost $7.8 billion, the Palestinian Authority said on Thursday, in the most comprehensive assessment yet of damage from a seven-week war with Israel during which whole neighborhoods and vital infrastructure were flattened.
The cost of rebuilding 17,000 Gazan homes razed by Israeli bombings would be $2.5 billion, the Authority said, and the energy sector needed $250 million after the Strip’s only power plant was destroyed by two Israeli missiles.
“The attack on Gaza this time had no precedent, Gaza has been hit with a catastrophe and it needs immediate help because many things can’t wait long,” Mohammed Shtayyeh, a Palestinian economist and a senior member of the West Bank’s dominant Fatah party, told reporters in Ramallah.
Rebuilding Gaza would depend heavily on foreign aid and would require an end to Palestinian rivalry and Israel opening its border crossings, said Shtayyeh, who heads the Palestinian Economic Council for Research and Development (PECDAR) which ran the survey.
But none of the factors mentioned by Shtayyeh appeared forthcoming. A donor conference in Cairo has yet to be formally scheduled, Palestinian institutions remain divided between Gaza and the West Bank and Israel has yet to fundamentally ease the movement of people and goods at its Gaza border.
The PA’s assessment also found that the Strip’s education sector would need around $143 million to get back on its feet. About half a million children have been unable to return to their schools due to damage or because the buildings are being used to house refugees.
Over 106,000 of Gaza’s 1.8 million residents have been displaced to U.N. shelters and host families, the U.N. says.
The remaining billions of dollars in the PECDAR assessment, which was compiled by 13 experts resident in Gaza and their research teams, were allocated to the financial, health, agriculture, and transportation sectors, all of which suffered widespread damage during the war.
The assessment also earmarked $670 million for an airport and sea port, which Shtayyeh said was a Palestinian right, but Israel has so far rejected.
Fighting between Israel and the Islamist militant group Hamas in Gaza killed over 2,100 Palestinians, most of them civilians, along with 64 Israeli soldiers and five civilians.
A ground incursion and bombing from the land, air and sea caused huge destruction in Gaza, while Palestinian rocket fire drove many Israelis from border communities, hit Israel’s summer tourism revenues and briefly shut down its main airport.
In the week since an Egyptian-mediated ceasefire took hold on August 26, little progress has been made in getting the rebuilding underway or settling the bitter political rifts around Gaza.
An international donor conference jointly chaired by Egypt and Norway has yet to be formally scheduled, and Israel has not fundamentally changed its curbs on the movement of people and goods, especially crucial building materials, on Gaza’s border.
The cash-strapped Palestinian Authority barely has enough money to pay its own employees in the West Bank and has no immediate plans to pay employees in the Hamas-run Gaza Strip, despite a unity pact signed between Fatah and Hamas in April.
“The Authority needs to be able to work as an authority to become completely responsible for all aspects of life in Gaza,” Shtayyeh told reporters.
Editing by Raissa Kasolowsky