The General Accountant, the Ministry of Finance, Yale Rothnberg today, explained today at the Globe Conference “Little in Israel” that there is no immediate possibility to upgrade the credit rating of Israel.
“The main thing that drives the perceptions of all classification agencies is geopolitical risks. The United States deals with the Houthis,” said Globe, Macro Orn, Ruthenberg, who recently met with representatives of Fitch.
Before the war, the public accountant raised the debts denominated in dollars with the spread of 95 basis points on the US Treasury bonds rewarded for 10 years. In its latest issue, in February, the Ministry of Finance gave investors a spread of 135 basis points. Shortly after that, the fighting resumed in the Gaza Strip. “We are exporting debts according to the annual plan, and we are trying to appear at the lowest possible risk.” The Israeli risk premium reached the peak of 200 basis points at the time of the first missile attack from Iran in April last year, but Rothnberg made it clear that as of November onwards, the installment had decreased in a sharp decrease, thanks to the election of Donald Trump as an American president, and he preferred a ceasefire with Hezbollah.
“It is important to return people to the house in the north and south
Regarding the plans to deal with the financial deficit, Rottenberg said there is no intention to make changes. “It is important to provide certainty to the local market, which is our bread and our butter. As a country, we do not close the financing channels. There are many financing channels, opportunities and risks. We have enough money, and we do not intend to raise the quantities in the local market as is the case in 2024, despite developments in the form of deficit.
The approved defense budget is 109 billion NIS, before American aid, the highest level ever, and therefore the public accountant explained that “there is an expectation of the Defense Foundation that it will adhere to the budget.” At the expenses of those who were evacuated from their homes due to the war, he said: “There are only 7,000 people in hotels. It is important to return people home in the north and south. One of the most important things in the 2025 budget is the restoration activity, and the rebuilding of the north and the south.”
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On revenues and expenditures, Rottenberg said that the aspect of revenues “behaves well.” On the side of spending, the goal of deficit is 4.9 % of GDP, which means 619 million NIS spending. “As you know, these are planning goals, and when the deficit is spread, the actual numbers. In the published numbers, there was a decrease in a deficit of 5.2 %, and it is likely to continue to decrease, with an increase at the end of the year to about 5 %. Growth expectations are currently 4 %, which is reasonable compared to growth 0.9 % according to the Central Bank in 2024.”
“I see in 2025 with a year of stability of debt: GDP.”
The public accountant stated that in the update reviewed in MOODY last week, they entered a 4 % line. “We are in a 4 % growth environment, with the upward trend and a negative side. It is important to enter the debt rate: gross domestic product in the direction of a decrease. In the past four years, chaotic years, in the fake period, there has been a deficit of 11 % with a negative growth of 1.5 %, the decrease in the ratio of gross domestic product to 70 %, and there is the war.
Rottenberg explained that the great test with regard to Modes was fulfilling financial goals. “I see 2025 as a year of stability of debt: the ratio of GDP. We are just less than 70 %, and I hope we will not reach 70 %.”
The conference will be held in cooperation with Cliving Insurance and is sponsored by One Zero Bank and Ratio Energies.
It was published by Globes, Israel Business News – En.globes.co.il – on March 24, 2025.
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