The impact of the Jerusalem Intifada on the Israeli economy


A Palestinian protester uses a sling to hurl stones towards Israeli troops during clashes near the Jewish settlement of Bet El, near the West Bank city of Ramallah October 20, 2015.  REUTERS/Ammar Awad
A Palestinian protester uses a sling to hurl stones towards Israeli troops during clashes near the Jewish settlement of Bet El, near the West Bank city of Ramallah October 20, 2015. REUTERS/Ammar Awad

Israel is currently in a state of chaos and confusion due to the dangerous decline in the security situation. The Palestinians’ operations and popular anger and protest in occupied Jerusalem, the West Bank and the Gaza Strip, as well as the Palestinian territories occupied in 1948 (Israel), are clearly having an effect. The Israeli economy has not been spared from the latest Palestinian response to Israel’s brutal military occupation. Indeed, the “Jerusalem Intifada” has had, and is likely to have, a major impact on the Israeli economy — including public and private facilities — as have its predecessors. Palestinian popular uprisings have had tangible negative effects on Israeli institutions, facilities, services, as well as their profits, completely or partially paralysing some. This has led ultimately to the gradual deterioration of the Israeli economy, slowly pushing it into a recession.

Israeli economic reports have revealed the extent of the damage in the event that the Jerusalem Intifada continues at the same pace for just two months. According to Makor Rishonnewspaper, just one month of the intifada would cost Israel about $1.3 million in national income, mostly in lost tourism revenue. It has already suffered in Jerusalem, with a 50 per cent in hotel reservations for October. A two-month uprising, with stabbings, hit-and-run attacks and shootings, would cost Israel around $2.7 million in direct and indirect losses. This will pose a serious threat to the overall economy, with the potential to push it into recession. In addition, the publication explained that an extra $1.1 million has been allocated to cover additional army and policing costs to cope with the uprising.

Credit card use has declined by 11 per cent since the beginning of this month. This is attributed to the fact that many Israelis are staying at home or buying from local shops and paying cash.

Economic expert Ayelet Nir believes that the lack of security felt by the Israelis has been reflected in the downturn. Although an actual war was fought in the summer of 2014, rather than a popular uprising, greater losses have been sustained by the Israeli market over the past two weeks than during the Gaza offensive.

Professor Avi Ben-Bassat, the former Director General at the Ministry of Finance, warned that Israel is facing serious economic damage. This intifada and consequent operations, he explained, have come at a time when the Israeli economy is suffering from slow growth and investments are suffering a sharp decline.

The repercussions and impact of the Jerusalem Intifada can be classified as direct and indirect. The former includes the disruption of production as well as domestic and foreign tourism. The number of tourists coming to Israel has dropped; hotel reservations are down and small businesses catering for tourists face closure.

In addition, the performance of the stock market has been hit, and the service economy has been disrupted, such as public transport and the carriage of goods around the country. An additional 300 police officers have been recruited to protect buses, with the extra costs that this incurs. In fact, the economy is impacted directly by the extra costs to the government for policing the overall uprising and the call-up of army reservists. Many businesses have closed down, especially in Jerusalem, which has an effect on Israel’s GDP.

The negative impact of the intifada is not limited to the economy. It has also hit the education sector, especially religious education in Jerusalem. Dozens of schools have been shut down, with students absent from classes; some towns have reduced the number of hours in the school day, and school buses are being escorted.

Indirectly, the effects of the intifada have led to those in economic circles saying that trust and satisfaction amongst foreign investors will fall. The lack of a stable economic environment will persuade investors to look elsewhere due to the absence of security in the occupied territories.

No one denies that the Israeli economy is booming in comparison to the economies of surrounding countries and developed capitalist countries; it is, after all, achieving 5 per cent annual growth. However, Israel’s is a daily, instantaneous economy that is impacted by events at any given the moment. Such an economy responds immediately to political variables and changes, as well as security incidents, and the variables of time and place. Hence, despite its relatively high growth rate, it may suddenly, not gradually, plummet to very low levels in the event that the intifada continues, and this will have a financial and psychological impact on Israeli citizens.

The Jerusalem Intifada is already having a negative impact on the Israeli economy. The government fears that if it continues, all trust in the ruling coalition will be lost. Although some believe that any losses suffered by Israel as a result of the uprising or any similar events can be compensated by means of more US support — and so the loss of a million here or there is no major problem — we must keep in mind that the confidence in Israel as a safe, democratic oasis is being shaken. It is also hard to quantify the psychological damage. It is a lie to suggest that Israel is the ideal country for investments planning to produce products reaching the largest growing market, which is the Arab world. The effects and impact of the intifada are likely to be devastating for Israel in every sense, not just economically.

Middle East Monitor



53 responses to “The impact of the Jerusalem Intifada on the Israeli economy”

  1. nagy_michael2 Avatar

    Stop the freakin settlements and stop taking over land that’s not yours. then you have the right to defend yourself. aggression will lead to more aggression and unfortunately neither side has learned yet and never will. it hurts everybody and it’s time for mature minds on both sides to come together and join for a peaceful resolution. But who are you going to depend? on Jewish Nutcrackers or Addisa Babba or Hamas or Jihad al islami? Zababa or O O O..all these crazies living next to each other.

    1. we have a lot of jungle..come to live in…I ll give you for free of charged..just shoot tigers and elephants.

      1. 5thDrawer Avatar

        Naughty, naughty, Zabada … you know Micheal-In-London will be all over you for shooting wildlife. He wants you to only grow more jungle.

        1. I guess an Israelis.

          1. Instead of guessing, how about asking me? I know your simple mind won’t understand two concepts in one sentence.

          2. All people are brothers..the Prophet Muhamad pbuh said..all human kind are brothers to each,s true..because all human kind descended to Adam and Eve..Adam and Hawa…Bible also told the same…but American Christians forgot the concept..that why they are killing Arabs on behalf of Zion nwo.Most Christians is nothing to do with Christians teaching..”love your neighbor” really in Bible..but they are killing others to dominate the world..playing death games to dominate anything they saw..but the world too large for them.In history no body controlled all part on the earth…no…

          3. sweetvirgo Avatar

            Christians forgot the concept?? What about your ISIS brothers and Al qadea?? Are they not killing each other?? Are they not killing other muslims??

          4. who created them to fight the Shiites..planned sectarian in Iraq…and the war would prolong to decades in future..and killing too many Arabs and is your America.

          5. sweetvirgo Avatar

            Oh so you’re telling me they are so dumb it’s easy for them to be manipulated?? You always have excuses for them

          6. 5thDrawer Avatar

            Hi Sweetie. 🙂 … Getting cooler there too, I imagine. Hope you’re ready for a winter.

          7. sweetvirgo Avatar

            Yes it is getting colder habibi…and I can’t stand it. I want to move to Florida. Maybe I can move next door to Geo ;))

          8. 5thDrawer Avatar

            I am certain he would enjoy more than coconuts from hurricanes in his pool. :-)))

          9. I’m certain you would enjoy cock in your mouth

          10. Tony Blair: I am sorry for the war in #Iraq.
            The 2 million Iraqis killed in this war respond:

          11. sweetvirgo Avatar

            Thank you for proving my point

          12. Sweetie, the only “point” you have is the one you are sitting on. Need new batteries?

          13. sweetvirgo Avatar

            Honey go fuck yourself and then your ISIS lovers

          14. nagy_michael2 Avatar

            Why are you blaming the Christians of the east for the mistakes of the west? majority of the middle eastern countries other than Lebanon it’s either Sunnis or Shiites who have the control? since when did we attack you? if you are so brave and strong then fight the westerners not us. Christians were not attacked by Saddam in Iraq but ISIS and Al Nusra did. Christians were not attacked in Syria yet your terrorists did. Christians were repeatedly attacked in Egypt for the so called attacks of the west and israel. you attack Yazdis accusing them of being infidels yet you enslave them and rape them. what kind of pure islam is this? i called pure bull shit. because you are full of it.

          15. I m not addressed my word up to you…even to the good Christians in the west…it is to the bad Christians in America..who killing others for oil..and of course not all of them…many American people oppose USA wars.Also many of them really war mongers.

          16. nagy_michael2 Avatar

            Zabada Christians in America are from many cultures so you guys get mad if I generalize muslims in one sentence yet it’s okay for make all Christians in America as bad. I understand what you are getting at but also you should know many illegal immigrants came to the US because of the American Christians. They are many good christians here who seek peace with Arabs and muslims. But these days they are apprehensive of them. If Dick Cheney and Henry kissinger and the few of American Leaders caused problems, that doesn’t mean christians agree with them. To be honest they are most hated here in America believe it or not. And not all AMericans are christians some pretends to be but they are not true christians. Others just because they are white that don’t make them christians because some are atheist and believe in Satan and they have many followers.
            It was American who saved many muslims nations yes. I agree the war in Iraq was a bad mistake and America paid for it. But for many to say America want to control the world. Then why did they withdrew from Iraq? why are they withdrawing from Afghanistan? they are in South Korea because they are trying to protect it from North Korea.. we as taxpayers paying billions of dollars toward Germany, South Korea, japan and many nations. Yes America made mistakes but America is the mother of all nations. Why more than 70% of the world populations want to come to America if they hate it like you? where do you and Nassrallah come up with such hypocrisy. Iran wants to control the Middle East when they go in they never come out.

          17. they go back after ruined many countries…democracy now is Zion tool to enslave others..countries and nations have different politic…you must allow them to practice what they. likes..if you force them on any kind of politic…the situation even worse…see in iraq and syria.Let them settle their chaos…and the chaos is not that bad..anyway your side,the Zion an Western or Eastern White,the Russian really need oil regime to support their civilization..democracy or not is only an alibi to cheating,enslaving,dividing the get their oil…also selling their killing machines to bearded Arabs.For sure..i m good historian…you are not.

          18. I have an idea: lets give #IS drones & hellfire missiles so they too can kill in a civilised manner instead of this barbaric head cutting.

          19. He has a good point.
            And before nagging Nagy barks, no one should be killing!!

          20. What do you do when you’re attacked by 60+ nations? Exactly, you bake a cake

          21. nagy_michael2 Avatar

            Attack the source.. instead of killing innocent civilians to take out your revenge. but it’s easier to rape and slaugher christians, shiites, yazdis and even many sunnis because they can’t fight the americans.

          22. America and you did it first.Iraqis learned how fight from the American and coalition.Can,t be defeated by world coalition.I guess Iraq new state is the new world super next to u.s.a,China and Russia.

          23. nagy_michael2 Avatar

            ok Zabada but why do you support ISIS when they killed many innocent iraqis and raping women? aren’t you doing the same?

          24. Jim Thompson 3 weeks ago
            George W. Bush is a political “sock puppet” programed by Yale to further the Elite’s nefarious agenda of global economic and military hegemony. Psychopaths such as this are without felling,sorry,guilt empathy,remorse or shame. Most Americans feel as long as they are able to get cheap gas they are not interested in the millions of innocent Iraqi citizens murdered due to their psycho leader’s war crimes, after all isn’t that the American way. Now that the mid east has been terminally destabilized, I guess it’s “Mission Accomplished”.
            Reply · 5

          25. “ok nagging Nagy but why do you support USA when they killed many innocent iraqis and raping women? aren’t you doing the same?”

            Dumb hypocrite

          26. nagy_michael2 Avatar

            listen Bitch i never supported the war in Iraq and i was always against it. I stated many times my opinion about Dick Cheney and Henry kissinger those war mongers and the oil companies to benefit as much as possible from Iraq. i never supported and never support any efforts despite Saddam aggressiveness against his people and his neighbors. that makes you the dumb hypocrite because you can’t differentiate. but again as i stated before you never condemn ISIS period for any killing against Iraqis and Syrians Sunnis anyway let alone christians and yazdis..

          27. “America and you did it first.Iraqis learned how fight from the American and coalition”

            You do have a good point there.

          28. “Then why did they withdrew from Iraq? why are they withdrawing from Afghanistan? they are in South Korea because they are trying to protect it from North Korea”

            Firstly, they are still occupying Iraq and Afghanistan and still killing civilians in the process.
            Secondly, why are they still in Japan?
            Defending a colonizing cancerous growth makes you an apologists for the crimes it commits.

          29. 5thDrawer Avatar

            And there’s the problem in the coconut-shell,right? One-on-one. Making a decision about who is good and who is not. Who is stealing and who is buying, Who is replanting the jungle, and who just burns it. And you should ‘poll’ 7 billion individuals to find out.
            Putting all those eggs in one basket and then dropping a piano on them doesn’t help discover which were rotten and which were not, because in the end, it’s just a mess.

      2. nagy_michael2 Avatar

        Zabada i miss you body where have you been? i thought you were celebrating

      3. nagy_michael2 Avatar

        I just wanted to Shoot O O O in her hairy butt.. lol

        1. You can shout it “in my butt” after I take a shite and don’t wipe.

          1. nagy_michael2 Avatar

            Typical ISIS slot.. that’s what i expect from an ISIS monkey anyway.

          2. Lol idiot was caught out so it resorts to its usual lame Isis insults. Lmfao at how narrow minded you are

          3. nagy_michael2 Avatar

            ISIS sympathizer and you love those hairy beasts don’t you.

          4. Lol what’s a “typical Isis slot”??

        2. Thank you for proving your true “Eastern” Christian values. Just coz we disagree, you want to kill me. Sweetie, if you can’t stand the heat, get out of the kitchen. Dumbass

        3. And another “Eastern” Christian that edits after one has already responded to it. What is with the deception by you lot on here?

      4. “just shoot tigers and elephants.”

        How fucking dare you!!

    2. That obviously didn’t come from a mature mind

      1. nagy_michael2 Avatar

        I don’t know what are you referring to.. Girly..

    3. EXCLUSIVE: The Drone Papers reveal the inner workings of the U.S. assassination program.

  2. 5thDrawer Avatar

    “some believe that any losses suffered by Israel as a result of the uprising or any similar events can be compensated by means of more US support” ….

    1. In short: Sunnis are US puppets, Shiites are Russia’s puppets. Those who’re free are “Terrorists”

      1. 5thDrawer Avatar

        Like me & you. :-)))

        1. yes… we both are terrorist.Because we are not support their fool war.

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