Israeli politicians focus on foreign threats, ignoring spiralling debt

What the report says

Al Jazeera reports that Israel’s election campaign is centered on security threats and military strength, while the financial burden of repeated wars is receiving far less attention from leading politicians. The piece says the country’s conflicts in Gaza, Lebanon, Syria and elsewhere, along with lower tax revenues and higher borrowing costs, have pushed public finances under growing pressure.

Citing figures from Israel’s central bank and finance ministry, the report says military spending and debt servicing have risen sharply since 2023, with national debt increasing from roughly 1.07 trillion shekels before October 2023 to about 1.4 trillion shekels. It also notes that defence spending has taken a larger share of GDP, and that the IMF has warned the 2026 budget deficit could make it harder to reduce debt. Some economists quoted in the article argue that the country may need higher taxes or lower civilian spending to stabilize borrowing.

The article adds that the strain is worsened by emigration among high earners and by longstanding disputes over the role of Israel’s ultra-Orthodox population, which is largely exempt from military service and heavily supported by state welfare. It also says defence contractors have not always been paid on time, and that concern in Europe about Israel’s conduct in Gaza could affect the sale of Israeli government bonds, potentially limiting the state’s ability to keep financing military spending.