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Israel’s Vital Tech Sector to Gain From Return of Army Reservists
Employees of StoreDot, an Israeli company that has developed extreme fast charging electric vehicle batteries, work in a laboratory in Herzliya, Israel, Oct. 2, 2023. Photo: REUTERS/Amir Cohen
Israel‘s wartime economy will get a much-awaited boost as the military gradually releases reservists fighting in the Gaza Strip so they can return to their jobs and jump-start softening growth.
Since the Oct. 7 attacks by the Palestinian terrorist group Hamas, more than 300,000 Israelis were drafted to reserve duty — many coming from the globally-important high-tech sector — leading to labor shortages and a gloomy national mood that hurt consumer spending and is expected to dent economic growth.
After nearly three months of intense air bombardment and a massive ground incursion, Israeli leaders have hinted that the war is entering a new phase, with a shift towards more targeted operations aimed at eliminating the Islamist group that rules Gaza and rescuing Israeli hostages.
The military accordingly is adjusting deployment plans for its forces in Gaza and other hot spots, first and foremost by starting to send reservists home — at least for a while.
It declined to share specifics about its number of forces, but said the move will “significantly alleviate economic burdens and enable them to gather strength for upcoming activities in the next year, as the fighting will persist, and their services will still be needed.”
Prior to the war, Israel was headed for solid economic growth of 3.4 percent in 2023 and 3 percent in 2024, according to the central bank. Now, the economy is headed for a fourth-quarter contraction and the Bank of Israel sees 2 percent growth this year and next, or zero growth per capita given Israel‘s fast-growing population.
Erel Margalit, who heads one of Israel‘s most active venture capital firms, Jerusalem Venture Partners (JVP), said the military made a calculated decision.
“They understand you need to go release people to go back to work because going back to work makes Israel stronger,” Margalit said. “Israel is not only strong militarily.”
START-UPS
With inflation easing, the Bank of Israel cut short-term borrowing rates by 25 basis points to 4.5 percent on Monday, its first reduction in nearly four years. The central bank’s policy makers are keeping an eye on the military’s strategy.
The release of reservists will benefit consumer spending, said deputy central bank chief Andrew Abir, which accounts for more than 50 percent of total economic activity.
“People were called up with no warning. In the first month, there was a real mess, because they were in the middle of projects,” Abir told Reuters, referring mainly to high-tech firms.
Spouses who may have been caring for their families alone since October will also be able to return fully to their employment, he said. This is good news for the high-tech sector, which accounts for 12 percent of employment, more than half of Israel‘s exports, 25 percent of income taxes, and nearly a fifth of its overall economic output.
Other signs of economic recovery in real-time data are emerging. Credit card purchases have returned to pre-war levels, Abir said, in “a sign the economy is functioning again.”
Foreign investment, while it has slowed, has not dried up. Startups raised $1.5 billion in the final three months of 2023 in 75 deals, according to data published last week. In 2023, funding fell to $7 billion from $16 billion in 2022.
Geopolitical risks may be off-putting, but they also offer a bigger potential upside, said JVP’s Margalit.
“There are some very good deals to be had,” he said.
Larger, well-funded tech firms have mostly weathered the war, and some have even thrived. Smaller companies, especially those that were hoping to close early financing rounds when the war broke out, have had a harder time.
In some cases, Margalit said, JVP and partner investors have had to inject more funds into these firms in order to “extend the runway.”
STATE SUPPORT
Pini Yakuel, CEO of marketing data firm Optimove, said they saw strong growth in the fourth-quarter despite having 41 of 240 workers in Tel Aviv drafted for reserve duty.
“We’ve adapted. It’s a new reality,” he said. “We just kind of, like, pressed on. Focused on what’s most important. Some things were paused, some things were delayed, but you continue to execute.”
His company put non-critical projects on hold and relied on offices abroad to help cover the load. And things will get easier as the absent employees slowly return.
“I notice in the office: ‘Oh hey, you’re back.’ ‘Yeah, I’m back.’ ‘Is it for good?’ ‘No, for the next month. Then they’re gonna tell us if we need to go back [to the reserves] or not’.”
The government took steps to protect the sector. State-funded Israel Innovation Authority set up a $100 million fund to help early stage startups.
In its recent survey, half of young companies only had sufficient funding for six months, said Dror Bin, the authority’s CEO. His fund has invested about $41 million so far.
“We all got our act together,” Bin said. “CEOs and employees realized that if they want to sustain the company’s success and their jobs they needed to refocus themselves on work.
“Despite all the empathy we get from the tech industry globally, at the end of the day when customers abroad need to get deliveries they can’t say that they didn’t get the deliveries because of the war in Israel,” he said.
($1 = 3.6437 shekels)
The post Israel’s Vital Tech Sector to Gain From Return of Army Reservists first appeared on Algemeiner.com.
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Security Warning to Israelis Vacationing Abroad Ahead of holidays
A passenger arrives to a terminal at Ben Gurion international airport before Israel bans international flights, January 25, 2021. REUTERS/Ronen Zvulun
i24 News – Ahead of the Jewish High Holidays, Israel’s National Security Council (NSC) published the latest threat assessment to Israelis abroad from terrorist groups to the public on Sunday, in order to increase the Israeli public’s awareness of the existing terrorist threats around the world and encourage individuals to take preventive action accordingly.
The NSC specified that the warning is an up-to-date reflection of the main trends in the activities of terrorist groups around the world and their impact on the level of threat posed to Israelis abroad during these times, but the travel warnings and restrictions themselves are not new.
“As the Gaza war continues and in parallel with the increasing threat of terrorism, the National Security Headquarters stated it has recognized a trend of worsening and increasing violent antisemitic incidents and escalating steps by anti-Israel groups, to the point of physically harming Israelis and Jews abroad. This is in light of, among other things, the anti-Israel narrative and the negative media campaign by pro-Palestinian elements — a trend that may encourage and motivate extremist elements to carry out terrorist activities against Israelis or Jews abroad,” the statement read.
“Therefore, the National Security Bureau is reinforcing its recommendation to the Israeli public to act with responsibility during this time when traveling abroad, to check the status of the National Security Bureau’s travel warnings (before purchasing tickets to the destination,) and to act in accordance with the travel warning recommendations and the level of risk in the country they are visiting,” it listed, adding that, as illustrated in the past year, these warnings are well-founded and reflect a tangible and valid threat potential.
The statement also emphasized the risk of sharing content on social media networks indicating current or past service in the Israeli security forces, as these posts increase the risk of being marked by various parties as a target. “Therefore, the National Security Council recommends that you do not upload to social networks, in any way, content that indicates service in the security forces, operational activity, or similar content, as well as real-time locations.”
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Israel Intensifies Gaza City Bombing as Rubio Arrives
Displaced Palestinians, fleeing northern Gaza due to an Israeli military operation, move southward after Israeli forces ordered residents of Gaza City to evacuate to the south, in the central Gaza Strip September 14, 2025. Photo: REUTERS/Mahmoud Issa
Israeli forces destroyed at least 30 residential buildings in Gaza City and forced thousands of people from their homes, Palestinian officials said, as US Secretary of State Marco Rubio arrived on Sunday to discuss the future of the conflict.
Israel has said it plans to seize the city, where about a million Palestinians have been sheltering, as part of its declared aim of eliminating the terrorist group Hamas, and has intensified attacks on what it has called Hamas’ last bastion.
The group’s political leadership, which has engaged in on-and-off negotiations on a possible ceasefire and hostage release deal, was targeted by Israel in an airstrike in Doha on Tuesday in an attack that drew widespread condemnation.
Qatar will host an emergency Arab-Islamic summit on Monday to discuss the next moves. Rubio said Washington wanted to talk about how to free the 48 hostages – of whom 20 are believed to be still alive – still held by Hamas in Gaza and rebuild the coastal strip.
“What’s happened, has happened,” he said. “We’re gonna meet with them (the Israeli leadership). We’re gonna talk about what the future holds,” Rubio said before heading to Israel where he will stay until Tuesday.
ABRAHAM ACCORDS AT RISK
He was expected to visit the Western Wall Jewish prayer site in Jerusalem on Sunday with Prime Minister Benjamin Netanyahu and hold talks with him during the visit.
US officials described Tuesday’s strike on the territory of a close US ally as a unilateral escalation that did not serve American or Israeli interests. Rubio and US President Donald Trump both met Qatar’s Prime Minister Mohammed bin Abdulrahman Al-Thani on Friday.
Netanyahu signed an agreement on Thursday to push ahead with a settlement expansion plan that would cut across West Bank land that the Palestinians seek for a state – a move the United Arab Emirates warned would undermine the US-brokered Abraham accords that normalized UAE relations with Israel.
Israel, which blocked all food from entering Gaza for 11 weeks earlier this year, has been allowing more aid into the enclave since late July to prevent further food shortages, though the United Nations says far more is needed.
It says it wants civilians to leave Gaza City before it sends more ground forces in. Tens of thousands of people are estimated to have left but hundreds of thousands remain in the area. Hamas has called on people not to leave.
Israeli army forces have been operating inside at least four eastern suburbs for weeks, turning most of at least three of them into wastelands. It is closing in on the center and the western areas of the territory, where most of the displaced people are taking shelter.
Many are reluctant to leave, saying there is not enough space or safety in the south, where Israel has told them to go to what it has designated as a humanitarian zone.
Some say they cannot afford to leave while others say they were hoping the Arab leaders meeting on Monday in Qatar would pressure Israel to scrap its planned offensive.
“The bombardment intensified everywhere and we took down the tents, more than twenty families, we do not know where to go,” said Musbah Al-Kafarna, displaced in Gaza City.
Israel said it had completed five waves of air strikes on Gaza City over the past week, targeting more than 500 sites, including Hamas reconnaissance and sniper sites, buildings containing tunnel openings and weapons depots.
Local officials, who do not distinguish between militant and civilian casualties, say at least 40 people were killed by Israeli fire across the enclave, a least 28 in Gaza City alone.
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Turkey Warns of Escalation as Israel Expands Strikes Beyond Gaza
Turkey’s President Tayyip Erdogan speaks during a press conference with Greek Prime Minister Kyriakos Mitsotakis (not seen) at the Presidential Palace in Ankara, Turkey, May 13, 2024. Photo: REUTERS/Umit Bektas
i24 News – An Israeli strike targeting Hamas officials in Qatar has sparked unease among several Middle Eastern countries that host leaders of the group, with Turkey among the most alarmed.
Officials in Ankara are increasingly worried about how far Israel might go in pursuing those it holds responsible for the October 7 attacks.
Israel’s prime minister effectively acknowledged that the Qatar operation failed to eliminate the Hamas leadership, while stressing the broader point the strike was meant to make: “They enjoy no immunity,” the government said.
On X, Prime Minister Netanyahu went further, writing that “the elimination of Hamas leaders would put an end to the war.”
A senior Turkish official, speaking on condition of anonymity, summed up Ankara’s reaction: “The attack in Qatar showed that the Israeli government is ready to do anything.”
Legally and diplomatically, Turkey occupies a delicate position. As a NATO member, any military operation or targeted killing on its soil could inflame tensions within the alliance and challenge mutual security commitments.
Analysts caution, however, that Israel could opt for covert measures, operations carried out without public acknowledgement, a prospect that has increased anxiety in governments across the region.
Israeli officials remain defiant. In an interview with Ynet, Minister Ze’ev Elkin said: “As long as we have not stopped them, we will pursue them everywhere in the world and settle our accounts with them.” The episode underscores growing fears that efforts to hunt Hamas figures beyond Gaza could widen regional friction and complicate diplomatic relationships.