Israel: the battle in Gaza will trigger GDP to break down by a fifth on the finish of 2023 | EUROtoday

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Israel's gross home product slumped 19.4% within the final quarter of 2023 in annualized phrases in comparison with the earlier interval, because of the battle within the Gaza Strip. This is what emerges from the information of the Central Statistics Office. Over the yr, the Jewish state's GDP grew by 2%, towards the Israeli Central Bank's forecast for a 2.3% improve on the finish of October, lower than a month after the Hamas assault. The final quarter of 2023 was the worst, by way of GDP per capita, because the first quarter of 2020, marked by the Covid-19 pandemic.

Consumption and international commerce collapse

Private consumption fell by 27% on an annualized quarterly foundation, because of the collapse in demand and client confidence within the early battle interval. Exports fell 18%, whereas imports slumped 42%, the information confirmed.

The financial downturn was rather more extreme than anticipated and highlights the extent of the harm performed by Hamas assaults and the battle, Liam Peach, senior rising markets economist at Capital Economics, mentioned in a word.

The worst drop since Covid

The fourth-quarter decline was the biggest because the second quarter of 2020, when GDP fell 29.0% because the coronavirus pandemic hit companies.

“While the recovery looks set to take hold in the first quarter, GDP growth in 2024 as a whole now looks set to register one of the weakest rates on record,” Peach added.