War on Lebanon can be 'lethal' to Israeli economy: Reports
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Israeli businesses in the northern occupied territories are enduring the impact of the war on Gaza.
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Israeli combat reservists and tank forces take part in training drills on the Lebanese front in the Israeli-occupied Syrian Golan Heights, Thursday, Jan. 4, 2024 (AP Photo)
A report by NPR on Tuesday detailed that the Israeli economy is enduring more difficulties now that tensions have worsened along the Lebanese border.
The NPR reports that, for instance, The Golan Heights Winery owners said that not only tourism and visitors have dwindled since the outbreak of the war, but daily operations have been disrupted as well.
Although Hezbollah rockets haven't reached the winery location yet, the economic toll is evident. CEO Assaf Ben Dov notes that the winery's production schedule has fallen behind due to staff shortages caused by reservists being called up for active duty.
Even more severely affected is the Galil Mountain Winery, situated in the settlement of "Kibbutz Yir'On", just a few hundred yards from the Lebanon border. The winery has been shut down since October, with daily access requiring military permission. The vineyards, vital for wine production, are currently inaccessible, raising concerns about the impact on the upcoming season.
Read more: Killing Palestinians costs 'Israel' $220Mln per day: WashPo
The economic downturn extends beyond the wineries. Border settlements, like "Kiryat Shmona", experience credit card spending levels that are still 70% below normal, economist Tomer Fadlon said. The evacuation of tens of thousands of settlers has resulted in an estimated cost of $158 million each week to "Israel's" economy, according to the Bank of "Israel."
The broader economic impact depends on the settlers' decision to return. Fadlon stressed that for "Israel", the war's aftermath is not only about winning but also about restoring confidence in safety and normalcy. The financial toll is substantial, with the central bank estimating a total cost of $56 billion — nearly half of "Israel's" annual budget.
"It will affect the economy in these places in the long run in a way that could definitely be lethal," Fadlon said.
Read more: Israeli fiscal deficit surges to 4.2% of GDP amid heightened war costs
As tensions rise along the northern border with Lebanon, the prospect of a broader war with Hezbollah looms. Israeli officials have expressed rising concerns about the potential paralysis of the entire regime for an extended period.
Analysts warn that a conflict with Hezbollah, equipped with a formidable arsenal, could have severe economic consequences, with the potential of "Israel" entering a prolonged period of economic stagnation.
'Most expensive war'
The Israeli economy is suffering significant repercussions from the war on Gaza, including a sharp increase in unemployment reaching unprecedented levels. Hundreds of thousands of workers have been laid off or called up as reservists, and requests for unemployment benefits have surged.
Israeli i24NEWS news website warned earlier this month that "Israel" is fighting in its most expensive war ever.
In a survey conducted by the Central Bureau of Statistics in "Israel" released last October, it was found that around 50% of Israeli companies experienced a significant drop in revenues amid the aggression on Gaza. Notably, the construction and food services sectors took the hardest hit, with more the three-quarters of the surveyed companies reporting a revenue decline of over 70%.
In addition to the unexpected and substantial costs of the military operations, which have led the occupation entity to borrow hundreds of millions of dollars, as reported by Bloomberg.
On Monday, Israeli Prime Minister Benjamin Netanyahu announced the regime's approval of the revised 2024 state budget, featuring augmented allocations for security and wartime expenses amid the ongoing war on Gaza.
