A poll, the results of which were reported by the Maariv newspaper, revealed that 43.73% of Israeli startups were established Outside Israel 2023following the escalation of the war on Gaza And its repercussions that included several fronts.
The survey, conducted by the Israel Association of Advanced Industries, indicated that this number represents a significant jump from only 19.92% of these companies were established outside Israel in 2022, according to the newspaper.
During the current year, data for the first quarter shows that 62.45% of Israeli startups were established in Israel, compared to 37.55% established outside of it.
The Israel Advanced Industries Association says the survey was conducted in a systematic manner to collect clear, factual data on an important issue that reflects current trends in all aspects of Israeli technology activity.
“The survey represents a broad phenomenon that indicates a large-scale transfer of economic activity outside of Israel,” said the association’s CEO, Meir Rubinstein. “We know the reasons, as well as the consequences for the Israeli economy and society.”
Closing companies
Israeli companies inside the country are facing the repercussions of the ongoing war on the Gaza Strip for months until at least the end of the year. It is expected that 60,000 companies will close during the current year, according to what the Times of Israel newspaper reported, citing the business information company “Covis BDI”.
The forecast comes nine months after Israel’s war on the Gaza Strip, with tens of thousands of businesses affected by rising interest and financing costs, labor shortages, a sharp decline in business volume and operations, disruption of logistics and supplies, and insufficient government assistance, the newspaper said.
By comparison, a record 76,000 businesses were forced to close during the COVID-19 pandemic in 2020, while around 40,000 businesses typically close annually.
“No sector of the economy is immune to the repercussions of the ongoing war,” Covis BDI CEO Yoel Amir told The Times of Israel. “Companies are dealing with a very complex reality: fear of an escalation of the war combined with uncertainty about when the fighting will end and ongoing challenges such as staff shortages, falling demand, growing financing needs, increased procurement costs and logistical problems.”