Some of these crises include political crisis and death of democracy, economic crisis and economic growth slowdown, security crisis and civil war risks, social crisis and reverse migration, identity crisis, and cultural crisis.
This analysis focuses on the Israeli economy from the dimension of related variables like investment, currency value, inflation, market, and high-tech businesses.
These crises came to surface after Netanyahu government pushed forward the judicial reforms and made their way to expansion in less than a year. Prime Minister Benjamin Netanyahu presses with the bill of judicial reforms to severely restrict the powers of the judiciary and, as his opponents say, form a dictatorship.
The bill triggered months of nationwide protests and inflamed an unprecedented home crisis. On the other hand, Netanyahu knows that if he backs down from his reforms, he will face pressure from hardliners of his coalition government, and if only one party walks out of the hard-forged alliance, his cabinet will collapse and he will be imprisoned for his crimes and corruption.
Essentially, the current cabinet was formed with a precondition of the far-right parties that stipulated Netanyahu should pass the judicial reforms at any expense. Therefore, given the tumultuous internal conditions, it is not difficult to foresee even more serious crises and more complicated troubles. These crises have taken their tolls on the Israeli regime, with economy experiencing collapse likeliness in the short and medium terms.
Troubled economic indicators
What's certain is that the most important factor in the economy and investment is sustainable security, something the Israeli regime currently lacks. At the same time, other important factors in investment including inflation rate, growth rate, political outlook, raw material prices, energy, population, consumptive culture, geographical position, global markets, financial and monetary stability, tax flexibility, environmental policies, political, economic, and military security have all relatively suffered challenges.
Nearly 40 percent of the Israeli GDP is dependent on the high-tech sector, or in other words, high-tech businesses form the driving force behind Israeli production, to an extent that more than 50 percent of exports are directly dependent on the high-tech sector, and more than 25 percent of total Israeli taxes are paid by the technology companies.
Examination of the economic data shows that currently a significant percentage of the profit of the start-ups or growing companies in the technology sector has seriously decreased. That is, we are witnessing a serious drop in investment in nearly half of the Israeli economy, and according to the reports of the Israeli central bank, investment has decreased significantly in the first half of this year, reaching $7.3 billion, which is lowest since 2018 amid the global investment recession.
What is important to mention is that the compliance of the economic policies of the Israeli regime with the US’s has produced an economic matching pattern for them, and thus the economic recession and collapse processes would bear similar results. So, like the bankruptcy of the American banks that happened despite adopting contradictionary monetary policies and also losses of the high-tech businesses, bankruptcy of the Israeli banks and technology companies is not unlikely in the short and medium term. Actually, with the continuation of insecurity and wide-ranging sabotage which is a kind of civil war, direct pressure will be felt by the economy and the capital flees at faster rates.
Examination of the Israeli stock market indicates that in the first half of this year, it has not grown considerably and even lost 10 percent of its value compared to last year and showed a negative performance along with global recession. Negative indication in stock market charts demonstrates exit of capital from the Israeli markets. This underperformnce comes as according to strategic planning of the Israelis, the GDP was set to grow 2.5 percent and next year 3 percent. But given the troubles and tensions the hardline cabinet is facing, this year's growth will be 1 percent at best and next year 1.5 percent. Some experts believe that amid growing unrest and home conditions deterioration, the Israeli economic plans will shrink 50 percent next year compared to this year.
The next issue that is an influential factor is that data and charts show that before the assumption of power by the hardliners, the inflation rate was 4.2, a figure attractive to the investment companies, especially high-tech companies, because stable inflation rates allow the investors to draw precise future plans. But now with the fleeing of the foreign capital, inflation is expected to set a new record in the medium and long term.
Furthermore, the value of Israeli currency has significantly shrank since the presentation of the judicial reform plan to the Knesset, and this downward trend continues. Even according sociologists, this has a direct effect on other matters, including reverse migration. In other words, if the crises and internal conflicts go on, the economy will grow even more fragile and lead to a collapse eventually.
The shadow of cabinet collapse and civil war on Israeli regime
The question that presents itself is that how far the plans to build a dictatorship by undermining the judiciary will go in the Israeli regime, and the main argument is that whether Netanyahu will walk back from his judicial overhaul with pressures building on him from various sides, especially the US.
The answer is that there is a slim possibility this motion halts, because the hardliners helped Netanyahu return to power under condition of pushing forward these reforms by the PM, and any backing down from this motion will trigger resignation of the far-right parties and collapse of the cabinet will become likely.
Meanwhile, the American approach is crucial, because the US seeks a mechanism for gentle pressure to avoid collapse and disappearance of the Israeli regime as a strategic ally amid a concrete belief that Tel Aviv is teetering on the brink.
The conclusion is that the Israeli regime is trapped under
blows of resistance group and geopolitical tensions, while it is already
struggling with serious political, economic, security, social,
identity, and cultural crises, as well as civil war risks and growing
reverse migration. As a result of these crises, division deepens every
day and economic collapse will leave direct impacts on other crises,
generally giving a good chance for demise of this evil regime.
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