Staff Reports
Israel’s economy took a major hit after the outbreak of war with Hamas, signaling the first taste of economic downturn for the country in two years! Yikes, talk about a rough patch!
Israeli economy contracts since outbreak of war https://t.co/pt0fzYd0fR
— Washington Examiner (@dcexaminer) February 19, 2024
According to the country’s Central Bureau of Statistics, Israel’s gross domestic product plummeted by a whopping 19.4% in the fourth quarter. That’s a far cry from the 1.8% growth it enjoyed in the previous quarter. Ouch, that’s gonna leave a mark!
Goldman Sachs Group Inc. economists Tadas Gedminas and Kevin Daly issued a report emphasizing just how brutal the conflict has been on Israel’s economy. They’re not pulling any punches!
The Israeli economy, worth a hefty $520 billion, has been pummeled since the surprise attack from Hamas on Oct. 7. The toll? The deaths of 1,200 civilians and the abduction of around 250 more. That’s some serious damage!
The ongoing conflict following Israel’s invasion of Gaza, aimed at wiping out Hamas, is estimated to rack up a daunting cost of about 255 billion Israeli shekels, or $70.3 billion, by the end of 2025. That’s a hefty 13% of the country’s GDP, folks!
Consumer confidence and household spending took a nosedive after the Oct. 7 attack, resulting in a gut-wrenching 26.9% plunge in private consumption. Oof, that’s gonna leave a dent in the ol’ wallet.
The call-up of reservists definitely played a part in the economic dip. With about 8% of the workforce pulled away for the war effort, that’s a big hole to fill!
Not to mention, pandemic-like restrictions walloped the market. It’s like one-two punch after one-two punch for Israel’s economy!
Businesses also took a hit, with fixed investment dropping by a painful 68%. That’s a lot of money flowing out the door! And let’s not forget about the nose-dive in exports, which fell over 18%. That’s some tough luck!
But hey, it’s not all doom and gloom. Despite the tough times, Israel’s GDP still managed to eke out a 2% expansion for the whole year, just as the central bank predicted. The central bank even expects another 2% expansion in 2024. So, there’s a glimmer of hope on the horizon! Maybe things are looking up after all!
