S&P sees no major Israeli economic recovery before 2026
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According to S&P, only in 2025 will the Israeli economy begin to recover, with a moderate 2.2% increase.
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Gantry cranes used to load and unload cargo containers in the port of Haifa in occupied Palestine on August 15, 2024 (AP)
S&P's newest assessment on "Israel", issued last night, states that the war on Gaza and Lebanon is anticipated to continue into 2025, delaying the occupation's economic recovery until 2026, Globes reported.
The international ratings agency lowered "Israel's" rating to A- last month with a negative outlook and predicts the occupation will have 0% growth in 2024, resulting in a GDP per capita decrease.
Only in 2025 will the Israeli economy begin to recover, with a moderate 2.2% increase.
According to S&P, the budget deficit would reach 9% of GDP by the end of 2024 and stay high at 5%-6% of GDP until 2027. These values are significantly higher than those expected by the Ministry of Finance, which might be attributed to differences in computation methodologies. Net government debt is predicted to reach 70% of GDP by 2027, an increase of 12% from 2023.
The agency predicts that the current account surplus will average 3.3% of GDP between 2024 and 2027.
The primary risk identified by S&P is a potential additional escalation in the north between the occupation forces and the Lebanese Resistance - Hezbollah, as well as a possible direct war with Iran.
Along with defense issues, the industry reports worsening relations with major partners. "The grave humanitarian situation and the increase in the number of civilians being hurt in Gaza, and increasingly also in Lebanon, have led to a number of public disputes between Prime Minister Benjamin Netanyahu and main allies including the US and UK."
Israeli website Globes also reported that Alliance Tires in Hadera, which has been owned by Japanese business Yokohama Rubber since 2016, is headed for a major wave of layoffs and may even be closed down 75 years after its inception.
The owner is looking for cheaper manufacturing options and reduced transportation costs, as the majority of output is exported, and expenses have grown since the beginning of the war as a result of Yemeni Armed Forces attacks in the Gulf.
According to sources acquainted with the situation at the Alliance facility, the Japanese owners will soon decide on the future of the Israeli tire manufacturer, which employs 450 settlers and has been directed by CEO Ygal Trichter for the past decade.
90 hotels closed, thousands of workers laid off: Israeli media
Israeli Channel 12 reported concerning data within "Israel," revealing that one in five hotels in the occupied territories have been shut down since October 7, 2023.
According to reports, 90 hotels have closed so far, with 20% remaining inactive, leading to the dismissal of thousands of workers.
Israeli media also noted that the airlines canceling flights to "Israel" have had a significant impact on various sectors, particularly tourism and the hotel industry.
In this context, they stated that thousands of families who depend on the hotel sector in "Israel" are now forced to find new sources of employment. It added, "We are talking about a decline of more than 85% in inbound tourism to Israel. There is no real tourism."
As the war rages on, "Israel's" economy is sinking. Earlier last month, passenger traffic at Tel Aviv’s Ben Gurion International Airport dropped by 43% during the first nine months of 2024 due to the escalations and war on Gaza and the northern front after October 7, which led many airlines to scale back or withdraw flights.
According to the airport authority, the airport served 10.85 million international passengers from January to September, a decrease from 19.01 million in 2023.
