Israel’s conflict with Lebanon-based Hezbollah has affected its own economy, according to its finance ministry.
Since the fighting escalated last month, the ministry said Israel’s economy has lost about £2.9bn, while its economists estimate a growth of 0.4% in 2024 – down from a prior forecast of 1.9% in May.
In a report, the ministry said: “This scenario is no longer relevant since the fighting expanded starting at the end of September to the northern arena.”
The ministry previously believed intense fighting would continue through the first quarter of 2025, but its latest forecast expects the worst of the conflict to end in 2024.
Growth looks to be 4.3% in 2025, it said, as the economy starts to rebound.
But if fighting continues into 2025, growth this year would be 0.2% and 3.4% next year, the ministry added.
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