ALBAWABA – Israel is reportedly planning to raise $60 billion in debt, freeze hiring for government jobs as well as implement tax surges in order to support its defenses, according to Financial Times, as the economy suffers deeply amid its war on Gaza strip.
Compared to pre-war finances, the Israeli government intends to increase military expenditure by 85%, or 55 billion shekels ($15 billion). The goal of this increase is to boost Israel's defence against changing regional developments.
The British newspaper stated that the economic impact occurred following Israel’s ban of entry for approximately 150,000 Palestinian workers from the occupied West Bank, and drove tens of thousands of settlers from the north near the border with Lebanon and the south close to the border alongside the Gaza Strip, along with mobilizing an unprecedented 300,000 reserve troops in addition to about 200,000 conventional soldiers.
Increasing the value-added tax, stopping government hiring, and taxing items like tobacco and bank transactions are some of the steps being taken to reconcile the government's finances.
The accountant general of Israel's finance ministry, Yali Rothenberg, emphasized that a recovery in the economy is anticipated when a significant portion of the reservists are demobilized and consumer spending picks up steam. But with renewed fighting along the Israeli-Lebanese border and the prospect for expanding offensives in Gaza, worries about further escalation grow.
The tent camps of displaced Palestinians are pictured in Rafah in the southern Gaza Strip close to the border with Egypt at sunset on December 31, 2023 (AFP)
Despite international warnings that an assault on such an abundantly populated region would be catastrophic the Israeli government is reportedly threatening to broaden its offensive in Gaza to include Rafah, the southern city in which over a million people have been forced towards from their homes in the Strip.
Over 30,000 Palestinians, mostly women and children, were murdered in the Israeli bombardment, which also devastated large portions of the region and caused more than 85% of the 2.2 million residents to flee their homes, as reported by Al Jazeera.
