Added to this is the permanent military presence which will have to be deployed on the spot would cost between 10 to 15 billion additional shekels each month (120 to 180 billion annually, between 32 and $ 48 billion).
Budget deficit
Also according to the media, a senior official of the Ministry of Finance said that these expenses could widen the budget deficit up to 6 or 7 % of the GDP of 2025. “Degradation at levels comparable to those of developing countries is not to be excluded “at-the having you.
To finance this operation, Israel will therefore have to prepare to make drastic cuts in the budgets of education, health, infrastructure and social protection, specifies the media.
Another source of concern: the 2026 budget has still not been completed and no director has been appointed to the Ministry of Finance. If the process remains blocked, Israel would start next year with a provisional budget, restricting state expenditure and more slowing investments.
Economic context
According to the Organization for Economic Cooperation and Development (OECD), although inflation in Israel has remained relatively moderate despite the context in Gaza, economic tensions persist. Since 2023, the conflict has heavily weighed on the Israeli economy, resulting in a marked drop in investments, exports and a general deterioration of activity.
In 2024, GDP growth fell to around 1 %, while the budget deficit has widened to reach almost 6.9 % of GDP, mainly due to the sharp increase in expenditure related to war in Gaza and Lebanon. In 2025, this deficit fell to 5 % and Israel said it wanted to reach 3 % by 2028. Objectives that seem to be compatible with previous financial estimates.
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The economy therefore remains under pressure, but recovery signals appear. The OECD provides for gradual recovery from 2025, with expected growth of 3.4 %, carried by a resumption of domestic consumption and investments. This dynamic should be strengthened in 2026, with growth estimated at 5.5 %.
