Middle East: Foreign companies continue to flee Israel, adding to the growing economic struggles of the Zionist entity. Once a thriving hub for global investments, the Israeli economy is now crippled by financial deficits, rising inflation, and the collapse of key revenue sectors, particularly the high-tech industry. This decline has been compounded by military, security, and economic blows inflicted by resistance movements in Palestine, Lebanon, Yemen, and Iraq.

Recent international reports spotlight the rapid deterioration of Israel’s economy, marked by a shrinking GDP per capita, weakened revenue streams, and the flight of high-tech firms due to heightened security risks. The Yemeni naval blockade and air transport disruptions, coupled with a brain drain of skilled workers, have further exacerbated the collapse of Israel’s high-tech sector—a once-prized pillar of its economy.

The ongoing exodus of foreign companies, especially those from the US and Europe, reflects mounting concerns over security risks, underscored by precision missile and drone strikes targeting key areas like Eilat and Haifa. Economic experts warn that this mass migration of talent and investment could cripple innovation and erode Israel’s competitive edge in cybersecurity and artificial intelligence, deepening the long-term economic recession.

Compounding these challenges, Israel’s currency, the shekel, continues to weaken against the dollar despite global trends, while inflation exceeds 4 percent, driven by soaring military expenditures and rising living costs. Increased interest rates have strained household budgets, fueling public dissatisfaction with Netanyahu's government, which now faces mounting internal pressures.

Experts estimate that rebuilding Israel’s infrastructure and economy could cost at least $20 billion, with total financial losses from recent military conflicts and subsequent economic fallout projected to reach $120 billion. These setbacks mark some of the heaviest economic and human losses Israel has faced since its occupation of Palestine.

Amid these crises, austerity measures—including cuts to healthcare, education, and infrastructure—have heightened domestic discontent, further threatening the stability of Netanyahu’s government as it grapples with unprecedented financial and social challenges.

Translated by Almasirah English website