(MENAFN) Updated data released by the Central Bureau of Statistics revealed a deeper contraction in the Israeli economy during the fourth quarter of 2023 than previously estimated. The economy shrank by 20.7 percent annually during this period, marking a significant downward revision from the initial estimate of 19.4 percent. The revised figures reflect the severe impact of the conflict between Israel and the Hamas movement in the Gaza Strip on key economic indicators such as consumer spending, exports, and investments.
The conflict significantly dampened consumer confidence and spending, leading to larger-than-anticipated declines in private consumption. Exports also suffered more extensive setbacks, likely due to disruptions in trade routes and heightened geopolitical tensions. Investment in fixed assets, a crucial driver of economic growth, experienced sharper declines, reflecting heightened uncertainty and risk aversion among businesses amid the conflict.
Although government spending grew slightly less than initially estimated, it remained a stabilizing factor in the economy. However, its positive impact was outweighed by the magnitude of the declines in other sectors.
Overall, the revised data underscores the profound economic toll of the Gaza conflict on Israel's economy, highlighting the need for sustained efforts to rebuild and restore economic stability in the affected regions.
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