The Finance Ministry feared that the war could cost 1.5-2% of GDP, up to NIS 10 billion.
The second Lebanon war in mid-2006 cut Israel’s GDP by 0.5%, or NIS 2.5 billion, half the preliminary estimate of a loss of 1% of GDP, or NIS 5 billion, the Bank of Israel said today.
The Ministry of Finance had feared that the war could cost 1.5-2% of GDP, up to NIS 10 billion.
The Bank of Israel said that GDP resumed an annualized growth rate of over 5% during the fourth quarter of 2006. In addition, the war had no effect on Israel’s financial stability. The bank said the loss of tourism revenue attributable to the war amounted to 0.3% of GDP. The loss of tourism cost business product 1.7% in 2006.
Published by Globes [online], Israel business news - www.globes.co.il - on February 7, 2007
© Copyright of Globes Publisher Itonut (1983) Ltd. 2007