The prime minister says the defense industry must become self-reliant to withstand potential sanctions
Israel will have to reshape its economy to withstand sweeping sanctions and boycotts, Prime Minister Benjamin Netanyahu warned on Sunday.
Speaking at the Finance Ministry’s annual accountant general conference in Jerusalem, Netanyahu said mounting international pressure over the Gaza war is pushing the country toward economic self-sufficiency.
“We will increasingly have to adapt to an economy with autarkic features,” he said. “I believe in free markets, I worked to bring Israel a free-market revolution. But we may find ourselves in a situation where our defense industries are blocked.”
We will have to develop domestic defense industries. We will have to become Athens and super-Sparta. We have no choice. At least in the coming years, we will have to deal with these attempts at isolation. What worked until now will not work from now on.
Pro-Palestine activists have been pressuring foreign companies to cut ties with Israel. Last week, European Commission President Ursula von der Leyen called for the EU’s free trade deal with Israel to be suspended, citing the humanitarian crisis in Gaza, where nearly 65,000 people have died since 2023. She accused “extremist ministers” in Netanyahu’s government of inciting violence against Palestinians.
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Israel receives around $3.3 billion annually in US military and security aid, along with additional packages approved by Congress. According to the Council on Foreign Relations, Washington has provided around $310 billion in mostly military assistance since 1946. In 2024, Israel’s military spending climbed to roughly 8.78% of GDP, nearly double the pre-2023 level.
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