Annual defense budget and spending in Israel 2017-2024

Israel's military budget for 2024 has seen a dramatic increase, reaching 118 billion shekels (approximately 30.5 billion U.S. dollars). This represented an 87 percent rise from the previous year, reflecting the country's heightened focus on defense spending. The jump in military expenditure comes in the wake of the Israel-Hamas conflict that began in October 2023, significantly impacting the country's national priorities.

Conflict driving a surge in government spending

The increase in military spending is part of a broader trend of elevated state expenditure due to the war in the Middle East. During the first quarter of 2024, government consumption in Israel reached over 123 billion shekels (about 32 billion U.S. dollars), marking a 27 percent increase compared to the same period in 2023. This surge in public spending has been largely driven by defense, but also welfare and compensation payouts to those impacted by hostilities.

Growing national debt

The ramifications of increased military spending are evident in Israel's national debt figures. By the first quarter of 2024, general government debt had swelled to over 1.2 trillion Israeli shekels (about 336 billion U.S. dollars). This represented a 10 percent increase in just six months. The escalation in debt levels underscores the financial strain of sustaining heightened military expenditure, which reached 5.3 percent of the country's gross domestic product in 2023.