The devastating consequences of Al-Aqsa storm on Israel’s economy; 260,000 Zionists in line for unemployment insurance

According to the international group Tasnim news agency, more than 120 days have passed since the Al-Aqsa storm war, the economic consequences of this war are directly and indirectly affecting the economy of the Zionist regime. A report by the Central Bank of Israel in late November 2023 indicates that the war has cost the occupation regime’s economy about 198 billion shekels ($53 billion) by the end of last year. This figure is equal to 10% of Israel’s total GDP. It is under the influence of this situation that Israel’s economic growth has faced a 4% drop compared to 2022 and has decreased to 2%. Also, in the final season of 2023 (due to the outbreak of war during this period), the economic growth of this regime was only 1%. In addition, total war expenses (direct and indirect) have reached 10% of GDP by the end of 2023.[1]

This is while the direct costs of the war are estimated at 13.8 billion dollars according to the report of the Ministry of Finance of the Zionist regime. Of course, due to the presence of Betsalel Smutrich, the leader of the extreme right-wing religious Zionist party, some analysts doubted the accuracy of the ministry’s statistics.

On the other hand, about 20 percent of Israel’s workforce has been called to the war fronts as reserve forces. Also, the war and insecurity conditions in the southern and northern border strips, which caused the evacuation of about 70 settlements and nearly 200 thousand people, also caused the total unemployment rate of adults in Israel to increase from 3% in the pre-war period to 10%. . In this regard, more than 260,000 people have requested to receive unemployment insurance.

An important part of the reserve forces called up in the field of technology and knowledge. have been active, this sector constitutes about 20% of the economy of the Zionist regime and 14% of jobs. Of course, due to the proximity of startups and the knowledge-based field to the Zionist army, as well as “Silicon Valley” in the United States, on the other hand, this field also benefits from the war, and therefore, despite the pressures caused by the war, it has not suffered a crisis or collapse.

On the other hand, despite the danger that war has for foreign investment in the regime, direct dependence on the American capital sector has prevented the reduction of foreign investment. For example, despite many concerns about capital flight, 220 “Courageous Investment” (VC) funds, by signing a letter of commitment with the guarantee of the Zionist regime’s cabinet, have emphasized the continuation of their investment in Israel after the events of October 7, in order to avoid the effects and consequences. The possibility of Al-Aqsa storm’s impact on the economy of this regime will be reduced. ” style=”text-align:justify”>In addition, the microelectronics and microprocessor company Intel announced the construction of a huge chip factory in the south of the occupied territories worth 25 billion dollars, which Prime Minister Netanyahu called the largest investment in the history of Israel.[3] Netanyahu’s cabinet claimed with a lot of publicity that this regime has contributed 3.2 billion dollars to this project.

However, the war has had a direct impact on the regime’s investment and economy. Benjamin Bentall, an economic policy researcher at the Quds-based Taub Research Center, told Al Jazeera news agency: “In terms of numbers, we have seen a clear decrease in investors in the regime.” He believes that without a clear military and political outcome and destiny in Gaza, as well as in the northern front of occupied Palestine and the border with Lebanon, it is not possible to continue the process of investing in economic growth, and the regime needs to restore the sense of security that was practically lost with the October 7 attacks. . A problem for which no prospects can be imagined now.

Apart from the evacuation of thousands of residents around the Gaza Strip as well as the north of the occupied territories (which It is estimated up to 86 thousand tons) The most important economic sector of the regime that has suffered the highest damage from the war is the tourism sector. This important sector, which had lost half of its value and growth after the Corona epidemic and the closures caused by it, has suffered heavy damage after the October 7 attacks.

Many restaurants and shops are closed. Also, many airlines have suspended their flights to this regime and almost all international tours to Israel have been suspended.[ 4] Despite the opening of German Lufthansa Airlines, Swiss Airlines and Austrian Airlines, which took place due to the pressure of governments and investors since the beginning of this month, the number of incoming tourists, which was 300,000 per month before the Al-Aqsa storm, is now It has reached 39 thousand people, which indicates an 87% decrease in the number of tourists in the occupied territories.

Construction Department

Another sector that has been severely affected by the war is the construction sector, which accounts for about 15% of the entire economy of this regime.

Evidence suggests that many construction projects across the occupied territories have been shut down and all employment permits for Palestinians, who make up about 70% of the sector’s workforce, have been revoked. In addition, due to the Israelis’ call for war, we have witnessed the unemployment of at least 100,000 workers inside the occupied territories.

The Zionist regime decides in the long term with The arrival of 70,000 construction workers from China, India, Moldova and Sri Lanka will compensate for the lack of labor in this sector. With all these measures, it is estimated that the construction sector of the Zionist regime is now operating at about 15% of the capacity before the October 7 attacks, and civil and construction activities have also decreased by more than 80%. The Taub Economic Institute analyst believes that the Zionist regime’s cabinet faces very difficult conditions to restore the economic situation to before the October attacks; Conditions that may last for years based on recent estimates.

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