Israel's Finance Ministry lowers GDP growth forecast for 2024-2025

Israel's Finance Ministry has revised its economic growth forecast for 2024-2025, citing the ongoing war and escalation of hostilities.  

"The GDP is expected to grow by 0.4 per cent this year and 4.3 per cent next year, down from previous estimates of 1.1 per cent and 4.6 per cent, respectively, made in September," the ministry said, Caliber.Az reports via Russian media. 

“Our forecast at the beginning of September was based on a scenario of continued hostilities until the first quarter of 2025 and did not anticipate further intensification or expansion to other fronts,” the ministry stated. “This scenario is no longer relevant, as the conflict has spread to the north at the end of September.” 

The conflict, which began with a Hamas-led attack on Israel on October 7, 2023, resulting in around 1,200 Israeli fatalities and 250 hostages, has since escalated. 

According to Palestinian sources, the Israeli response has led to approximately 43,000 deaths across the Gaza Strip, leaving the territory devastated. As the hostilities continue, international calls for a ceasefire have so far failed to gain traction. 

On October 26, Israel conducted direct strikes on Iran in a significant response to Tehran's ballistic missile attack earlier this month. According to an Israeli military source, the strikes targeted military installations but did not impact energy infrastructure.  The attack resulted in the deaths of four members of Iran’s military, prompting Tehran to assert its right to defend itself. However, Iran seemed to downplay the overall impact of the strikes, stating that the damage at military sites was minimal.

By Naila Huseynova