Recent Unrest Having an Impact on Israel’s Economy
It’s no secret that there has been a lot of unrest in Israel in recent months. Between the violence in confrontations with Palestinians this summer and the recent attack on the synagogue in Jerusalem, it has been a turbulent time for the Holy Land. Now, new numbers show just how much of an impact this unrest is having on Israel’s economy.
Overall, Israel’s economy has recently been growing at an annual rate of approximately 3 percent. However, in the
third quarter of this year, which contained the battles in Gaza and a significant drop in tourism, the nation’s economy actually shrank by .4 percent. This was the first drop in Israel’s economy in a given quarter in five years, which would seem to indicate that the constant conflicts with Palestinians are beginning to take an even larger toll on the nation.
That drop in tourism is important to note. Israel, despite the unrest it has faced over the years, has always been a popular tourist destination because so many religious pilgrims flock there every single year. However, people who work in the tourism industry have said that because of recent unrest, people are reluctant to put down payments for trips that they will be taking early next year, and many are canceling altogether. The tourism industry makes up about 2 percent of Israel’s economic output, which means that a significant drop in spending in that industry will definitely leave a mark on the nation’s overall economy.
Then there is the amount of military spending that one has to factor in to Israel’s current economic state. The Gaza conflict cost more than the nation had anticipated, and as a result, the nation will be facing a larger budget deficient than expected next year. The conflict cost Israel approximately .6 percent of its gross domestic product.
It’s difficult to say how long these downward economic trends will continue in Israel, but one thing is clear: the nation’s economy is clearly tied to violence in the region. As peace is restored, Israel’s economy will improve.
Continue to pray for Israel and for peace in the Middle East. Talk to us at Curt Landry Ministries for more information about how you can support the region.