WEF says Israel's economic growth will slow down in 2024

The Israel-Hamas war has shifted the WEF Chief Economist's forecast regarding the economic trends in the Middle East

i24NEWS
i24NEWS
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4 min read
View of the old templar buildings and newly built high rises in the Sarona Market, central Tel Aviv, Israel, on May 28, 2020.
View of the old templar buildings and newly built high rises in the Sarona Market, central Tel Aviv, Israel, on May 28, 2020.Moshe Shai/Flash90

In the Chief Economists Outlook published on Monday, the International Monetary Fund (IMF) said that Israeli economic growth will significantly slow in 2024 citing the ongoing Israel-Hamas war.

The IMF chief economist Pierre-Olivier Gourinchas reportedly expects Israel's gross domestic product GDP to grow by far less than the 3% annual growth rate the fund had forecast before the war. The IMF has not yet published a specific updated forecast detailing the scale of the drop.

Caroline Haïat/i24NEWS
Ramat Gan.Caroline Haïat/i24NEWS

This aligns with the estimations made by Israeli institutions. Bank of Israel has forecasted for 2024 the GDP growth by 2%. Meanwhile, Israel's Ministry of Finances' estimation is that the index would grow only by 1.6%. 

According to the Ministry of Finances, the national GDP is likely to have contracted by about 20% in the fourth quarter of 2023 compared to the same period in 2022. The Israel-Hamas war slowed down many sectors partially due to the large-scale reservist call-up and businesses facing labor shortages.

Flash90
A stock market ticker screen in the lobby of the Tel Aviv Stock Exchange, in the center of Tel Aviv, Israel, March 15, 2020.Flash90

Earlier report by Ynet suggested that Israel's war against Hamas had costed the national economy approximately 217 billion shekels (about $59,2 billion) by the early January. Operation Iron Sword is the most expansive military campaign in Israeli history.

Uncertainty around the Israel-Hamas war has triggered "a slight weakening of economic growth expectations for 2024" in the Middle East and North Africa region, the report also noted.

See more updates on the Israel-Hamas war

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