The Israeli economy is expected to take a hit from the Trump administration’s proposed global tariff plan, with the Finance Ministry estimating a potential annual GDP loss of less than 0.5%, or under NIS 10 billion.
Tel Aviv, Israel © Mena Today
The Israeli economy is expected to take a hit from the Trump administration’s proposed global tariff plan, with the Finance Ministry estimating a potential annual GDP loss of less than 0.5%, or under NIS 10 billion.
Despite the uncertainty around the final tariff rates, the ministry considers the expected impact moderate compared to forecasts for other countries, including the U.S. itself.
The Ministry of Finance had already been planning to revise its 2025 growth forecast downward due to better-than-expected GDP results for 2024. Initial estimates predicted 4.3% growth, but recent figures show 2024 growth at 1%, slightly above previous projections.
While the final revision will be announced by late May or early June, the tariff issue has made a reduction in the growth forecast inevitable.
The Bank of Israel has already adjusted its 2025 forecast from 4% to 3.5%, while the IMF now predicts Israel’s economy will grow by 3.2%, an improvement from its earlier 2.7% forecast.
Turkish President Tayyip Erdogan told leaders at a NATO summit on Wednesday that a ceasefire between Israel and Iran needed to be made permanent, his office said, and called for a ceasefire in Gaza to alleviate the humanitarian crisis there.
The Israeli military said seven soldiers were killed in a single attack in southern Gaza on Tuesday, the military's deadliest day in the territory since it broke a ceasefire with Hamas in March.
The ceasefire brokered by U.S. President Donald Trump between Iran and Israel appeared to be holding on Wednesday a day after both countries signalled that their air war had ended, at least for now.
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