Tel Aviv, MINA – Israel’s economy has sustained losses of up to 177 billion shekels, approximately $57 billion over two years of war in Gaza, according to the Bank of Israel’s annual report released on Monday. The figure represents 8.6 percent of the country’s annual gross domestic product (GDP).
The report, cited by Bloomberg, covers losses incurred between 2023 and 2025. The losses are largely attributable to the war in Gaza, which also encompasses the costs of Israel’s military campaign in Lebanon. Notably, the report does not yet account for the economic impact of the latest conflict involving Iran, which has now entered its fourth week amid a series of airstrikes and retaliatory exchanges.
Earlier this month, the Israeli Cabinet approved a revised state budget for 2026, adding $13 billion to fund ongoing war efforts.
The Bank of Israel’s report also noted a shift in trade patterns as a result of the conflict. Israeli exports to eight European Union countries, considered more critical of Israeli policy, fell by $1 billion in 2024 and a further $1.5 billion in 2025, while trade with several other nations increased over the same period.
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“This pattern may indicate that political positions are influencing export volumes to those countries,” the central bank’s report stated.
The 12-day conflict with Iran in June of last year alone is said to have reduced Israel’s economic output by 0.3 percent of GDP.
Israel launched its military offensive in Gaza in October 2023. Israeli forces have since killed more than 72,000 Palestinians, wounded approximately 172,000 others, and destroyed an estimated 90 percent of civilian infrastructure across the territory.
Despite a ceasefire reached last year, Israeli forces have continued to carry out strikes killing hundreds of Palestinians in Gaza.[]
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Mi’raj News Agency (MINA)
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