Israeli economy in chaos in anticipation of Iran, Hezbollah responses

By Al Mayadeen English
Source: Israeli media
15 Aug 2024 11:16
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The past two weeks have largely affected several sectors in the Israeli economy, due to increased operational and precautionary measures, as well as wide-ranging public fear.

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Ann Emad, a liquid-fueled medium-range ballistic missile, is launched by the Iranian Islamic Revolution Guard Corps Aerospace force, during a drill held on January 16, 2021. (AP)

The Israeli occupation's anticipation of Hezbollah and Iranian response to Israeli assassinations carried out in late July has pushed the regime into "economic chaos", Israeli media outlets reported.

The economic affairs commentator for Israeli broadcaster Channel 13 underlined that the past two weeks have "exhausted" the Israeli market. Several economic events were canceled in Israeli-occupied territories, while others were reduced due to the state of anxiety experienced among settlers.

Economic activities have also been affected by the operational measures issued by Israeli authorities, in preparation for retaliatory strikes by Hezbollah and Iran.

The Israeli commentator highlighted the significant losses that affected the Israeli tourism sector, largely linked to international flight cancellations to Israeli-occupied airports. An increasing number of Israeli settlers have been stranded in other countries due to the wide-scale cancelation of flights. The possibilities of responses launched by the Axis of Resistance have also impacted hotels and other hospitality and tourism businesses in the northern Israeli-occupied territories, which may be directly affected by future strikes.

The commentator warned that these challenging conditions and operational measures, which are also impacting the medical and energy sectors, could persist well into September.

If the wait continues into next month, the Israeli educational sector will also be severely affected by operational measures, forcing institutions to "maneuver within combat scenarios."

'The war is breaking the State of Israel': Itzhak Brik

Meanwhile, former Israeli occupation forces ombudsman Major General Itzhak Brik pointed to the larger-scale cost of the Israeli war on Gaza in an article he wrote for Maariv.

The former Israeli official decried the current battles as a "war of attrition" that has affected the Israeli regime for nearly a year. He said that the war is leading to the "collapse of the Israeli economy."

He said that the occupation is facing a "deficit exceeding 8%" of Gross Domestic Product (GDP). Brik revealed that officials in the Israeli Finance Ministry fear that the deficit will increase to 9% of GDP this year, a number that far exceeds the 6.6% target the government had expected.

"Many of the driving forces behind the growth of the Israeli economy, namely high-tech entrepreneurs, are leaving Israel," Brik added.

The retired Israeli officer highlighted that more than one hundred thousand evacuated Israeli settlers have either gone unemployed or have witnessed a reduction in their salaries. As a result, these individuals are no longer contributing to the government's revenue through taxes; instead, they are reliant on government subsidies.

"The ongoing war of attrition between Israel and Hamas and Hezbollah will not only fail to lead to the collapse of Hamas and certainly not Hezbollah, but the opposite is true—this war is draining and breaking the State of Israel in several areas," Brik asserted.

The Israeli occupation is facing a series of economic, social, and political issues that have arisen due to the continued war on Gaza and its repercussions on different fronts. Israeli media outlets estimate that the war has cost the Israeli economy nearly 250 billion Israeli shekels or around $67.5 billion. The Israeli occupation forces and security establishment are also expected to spend another 20 billion shekels or around $5.4 billion.