The Israeli operation to occupy the city of Gaza is expected to add $ 25 billion ($ 7.5 billion) to the war account by the end of the year, according to a government official.

The extra cost, over 1% of the country’s GDP, is added to the $ 204 billion ($ 61 billion) that have already been spent in the two years of the Gaza war. Most of the expenses relate to salaries, ammunition and rocket intercept systems, including businesses in Lebanon, Iran, Syria and Yemen.

Isolation

The advance to the city of Gaza, the de facto capital of Palestinehe encounters strong reactions internationally. On the sidelines of this year’s UN General Assembly, France is expected to recognize a Palestinian state, while Canada, the United Kingdom and Australia have already done so on the weekend.

OR Government of Benjamin Netanyahu He insists that the neutralization of Hamas, which the US and the EU call terrorist organization, remains a non -negotiable target.

Financial implications

With the war approaching the two years and battles in Gaza continuing, investors are closely monitoring the financial impact. The $ 580 billion Israeli economy remains shrinking over pre -war levels (in real terms), while last year the government resorted to historical borrowing from bond markets.

The Council of Ministers have already called for a 30 billion budget increase this year’s budget, just six months after its approval to cover the war with Iran and previous operations in Gaza. The budget deficit is projected to increase to 5.2%, with the possibility of further revisions.

Where do the money go?

According to the official, one -third of war spending concerns payments to reserve soldiers, tens of thousands of whom have been recruited. Their average salary is 36,000 Cekel a month, about 50% above the average salary in the country.

Fire and interceptic rockets are the second largest budget (25%). The Cost of intercepting a ballistic rocket It ranges between 15 and 30 million Sekel, according to General Manager of the Ministry of Defense, Amir Baram. An attack on Houthi in Yemen is costing around 50 million Sekel.

At the same time, Israel has about $ 49 billion in future purchases and equipment programsan amount almost equal to the war account so far. The agenda includes 2.9 billion for a Squadron F-35, 2.8 billion for Sa’ar warships and $ 1.5 billion for an F-15 degree, as well as $ 8.9 billion for research and development.

After the 12 -day war with Iran in June – which emerged in response to Israeli attacks on nuclear and military installations – the Netanyahu government accelerates the preparation for future threats from Iran and Yemen. In this context, a new National Equipment Council is being created.