War With Hamas Could Have A Major Impact On Israel’s Economy  

• Israel is gearing up for a potentially prolonged conflict with significant humanitarian implications. Hamas militants initiated a surprise terrorist attack, prompting the Israeli defence forces to call up over 300,000 reservists, an unprecedented move in recent history.
• Israel's standing army, air force, and navy consist of 150,000 members, while the reserve force comprises about 450,000 members, bringing diverse skills and experience to the military. Reservists come from various sectors, including education, technology, entrepreneurship, agriculture, law, healthcare, tourism, and manufacturing.
• The economic impact will hinge on how long reservists are away from their civilian jobs in a country with a population of over 9 million and a GDP of $521.69 billion. Immediate effects include a drop in tourism, but a potential surge once the conflict subsides due to pent-up demand.
• Certain employment sectors, heavily staffed with foreign workers, are expected to continue operations during the war, minimizing disruption. This includes the chemical sector, a major source of Israel's exports, and the Potash industry in the Dead Sea region, easing concerns about potash supply.
• The main Israeli stock index has seen a 6% decline this week, reflecting market concerns related to the ongoing conflict. No new warnings from rating agencies regarding Israel's debt have emerged, though prior concerns existed due to political instability and proposed judicial reforms.
• Despite the challenging situation, there is optimism that Israel will ultimately achieve a military victory, potentially leading to an improved country and economy. The prolonged instability in the Gaza region may find a resolution through this conflict, bolstering confidence in the long-term stability of the area.

(Source: CNBC)