The Israeli Ministry of Finance announced on Wednesday that the economic losses resulting from the Israeli American war on Iran could exceed 9 billion shekels per week, equivalent to approximately 2.9 billion US dollars, due to strict restrictions imposed across the country.
According to the ministry, estimated economic losses could reach 9.4 billion shekels weekly under the current “red level” emergency measures. These restrictions include limits on movement to workplaces, the closure of schools, and the mobilisation of reserve soldiers.
The ministry has urged the Home Front Command to shift the country to the “orange level”, a less restrictive status for workplaces. Under that scenario, economic losses are expected to decline to around 4.3 billion shekels per week.
Escalation of the War with Iran
The Israeli occupation and the United States began bombing campaigns against Iran last Saturday, prompting Iranian retaliatory missile and drone strikes against Israeli targets and other locations across the region. The escalation has also disrupted energy exports from Gulf countries.
American and Israeli officials have indicated that the military campaign could continue for several weeks.
Meanwhile, schools will remain closed throughout the week. Public gatherings have been prohibited, and most workforce activities have been suspended except for essential services. The majority of employees have been instructed to work remotely from their homes.
Rising Budget Pressure
Israeli Finance Minister Bezalel Smotrich stated that the financial cost of the war could increase significantly in the coming period.
He explained that the main challenge lies in integrating immediate wartime spending into the 2026 state budget, amid political and legal sensitivities surrounding the timing of its approval.
Smotrich warned that the budget deficit could exceed 3.9 percent, surpassing the target set in the proposed budget plan.
According to the Israeli newspaper Globes, the government has allocated an additional 9 billion shekels, roughly 2.9 billion US dollars, for security spending beyond the 112 billion shekels already allocated in the 2026 budget.
This would raise the defence budget to at least 121 billion shekels, according to financial estimates reported by the newspaper Calcalist.
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