Israeli debt rose by $8 billion since start of war on Gaza
3 Min Read
The Israeli occupation's debt is on the rise as the war on Gaza continues to increase in cost for "Israel".
-
Israeli Prime Minister Benjamin Netanyahu attends a press conference with Security Minister Yoav Gallant and Cabinet Minister Benny Gantz in the Kirya military base in 'Tel Aviv', occupied Palestine, October 28, 2023 (AP)
The Israeli occupation has successfully raised approximately 30 billion shekels ($7.8 billion) in debt since the start of its aggression on Gaza, as reported by the Finance Ministry on Monday.
Out of the total amount, around 16 billion shekels were raised through dollar-denominated debt in international markets, highlighting the Israeli occupation's efforts to seek financial support on a global scale.
In addition to this, the Finance Ministry conducted a weekly bond auction in the local market, resulting in the acquisition of an additional 3.7 billion shekels.
The Israeli occupation's financial capabilities "allow the government to fully and optimally finance all its needs," stated the accountant-general division of the ministry as the debt continues to pile up just short of 40 days into the aggression.
Genocide is proving to be expensive as the Israeli occupation's expenditures continue to pile up as the funds allocated to support the Israeli occupation forces and the businesses located near the separation wall erected on Gaza's border seem to diminish as tax incomes are on a low.
"Israel", in light of the expenditures and the diminishing taxes, is facing a substantial budget deficit of 22.9 billion shekels in October, a near-five-fold increase from September's 4.6 billion. Over the past 12 months, the Israeli occupation's deficit has risen to 2.6%.
Prime Minister Benjamin Netanyahu previously pledged to "open the taps" in light of the ongoing war. Meanwhile, economists anticipate that this would hike the deficit and debt-to-GDP ratio through 2024.
The governor of the Bank of Israel, Amir Yaron, went against this view, emphasizing the need for the government to strike a balance between supporting the economy and maintaining a sound fiscal position.
Due to the prolonged aggression on Gaza, "Israel's" economy is predicted to contract by around 1% this year, and the country's debt to GDP ratio is predicted to surpass 65%, central bank governor Amir Yaron stated on Thursday.
In a live-streamed discussion regarding monetary policy, Yaron stated, "Assuming the war is primarily concentrated in the southern border, and lasts till the end of this year, GDP growth is likely to shrink by about 1% in 2023."
The Israeli Finance Ministry announced on Wednesday that the occupation's budget deficit for October was 22.9 billion shekels ($6 billion), citing an increase in costs associated with financing "Israel's" war on the Gaza Strip.
Credit rating agencies have issued warnings about the potential downgrade of Israel's ratings if debt metrics continue to deteriorate, as well, as "Tel Aviv" might move toward asking for a loan from the central bank, as per Israeli media.
Moreover, Galit Altstein wrote for Bloomberg News that the ongoing war on Gaza is causing the Israeli economy significant losses, estimated at about $260 million daily.
Yet, it's not just the financial toll that's causing concern for Netanyahu. The conflict, already devastating in terms of lives lost, is proving to be more costly than initially anticipated, straining public finances.
However, it's the controversial allocations for ultra-Orthodox schools and other favored causes championed by extremist groups in the ruling coalition that have sparked a national debate and unsettled markets.
