Israel's 12-month budget deficit rises to $29.4b due to war expenses

The Israeli government's 12-month budget deficit rose sharply to 105.1 billion shekels (29.4 billion U.S. dollars) at the end of February, or 5.6 percent of its GDP, the country's Finance Ministry said on Sunday, reported Xinhua.

It is an increase of about 18 percent compared to the previous 12-month deficit between February 2023 and January this year, which stood at 89.1 billion shekels (24.93 billion U.S. dollars), or 4.8 percent of GDP, according to the ministry's data.

For a year-on-year comparison, a 12-month surplus of 3.4 billion shekels (951 million U.S. dollars) was recorded in the Israeli budget between March 2022 and February 2023.

The ministry explained the deficit rise mainly in the high expenses associated with the ongoing conflict with Hamas, which stood at 17.3 billion shekels (4.84 billion dollars) in 2024, joining last year's conflict expenses of 6.59 billion dollars.

In total, the Israeli government's spending increased by 43.6 percent year-on-year in January-February, while total revenues were almost unchanged during the two months.

The ministry noted that the deficit rise trend is expected to continue in the coming months and decrease towards the last quarter of the year due to a change in the distribution of the conflict's expenses and income.