Israel’s economy shrank in the second quarter of this year, according to data released Sunday by the Central Bureau of Statistics, under pressure from the ongoing war on Gaza, which has entered its tenth month.
Israel’s economy grew by 1.2% in the second quarter, year-on-year, below a Reuters poll estimate of 4.4% growth.
to retreat
The figures reflect a negative growth in per capita GDP of 0.4% year-on-year, when adjusted for population growth.
Private consumption increased by 12% compared to the second quarter of last year and 2.9% in the second quarter, leading growth that had been on the rise since the beginning of the year, after a sharp decline in the last quarter of 2023, at the beginning of the war on Gaza.
The growth recorded in the second quarter was driven by an 8.2% increase in government spending, while business production fell by 1.9%.
First-quarter GDP growth was revised up to 17.3% year-on-year from a previous estimate of 14.4%, recovering from a 20.6% contraction in the fourth quarter of 2023.
Growth record
Israel’s economy is projected to grow by 2% in 2023, reflecting a negative growth in per capita GDP of 0.1%, due to population growth last year.
This comes after GDP grew by 6.5% in 2022, and with the exception of 2020 when the Covid-19 pandemic struck, and Israel’s economy shrank by 2.5%, the last time the economy shrank was in 2009, in the wake of the global financial crisis.
