The Future is Bleak – Moody’s Downgrades Israel’s Economy
Israel’s economic woes continue with the downgrading of its credit rating by Moody’s Investors Service on Friday.
This is considered the first-ever sovereign downgrade by Moody’s, which cited the impact of Israel’s ongoing war on the Gaza Strip.
Israel was “cut by one notch to A2, the sixth-highest investment grade and on par with Poland and Chile,” Bloomberg said, also reporting that Moody’s “changed the outlook to negative, concluding a review that it started in October.”
In its statement, the global credit rating company concluded that the war and its aftermath will “materially raise political risk for Israel as well as weaken its executive and legislative institutions and its fiscal strength, for the foreseeable future”.
Moody’s expects “that Israel’s debt burden will be materially higher than projected before the conflict.”
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In his response, far-right Prime Minister Benjamin Netanyahu tried to play down Moody’s decision to lower Israel’s credit rating and downgrade its future outlook.
“The Israeli economy is strong,” Netanyahu alleged, adding that the “rating downgrade is not connected to the economy, it is entirely due to the fact that we are in a war”.
Netanyahu said in his statement, quoted in The Times of Israel, that “The rating will rise back at the moment we win the war — and we will win the war”.
However, it is clear that Netanyahu’s war on Gaza is not going anywhere, following 127 days of an outright genocide, which resulted in the killing and wounding of over 100,000 Palestinians and the destruction of most of Gaza.
The Palestinian Resistance, on the other hand, has reportedly destroyed well over 1,000 Israeli military vehicles, killing and wounding thousands of Israeli soldiers.
According to economists interviewed by The Washington Post, the war has cost the Israeli government about $18 billion — or $220 million a day.
(The Palestine Chronicle)