Statement by S&P on Israel's Political Stability

Standard & Poor's explained that the political and security risks in Israel have increased sharply in the past few days.

A statement has been made bt the international credit rating agency S&P on Israel's political stability. Standard & Poor’s (S&P) stated that the political and security risks in Israel have increased in the last few days and that the increase in these risks in the long term may increase the pressure on the credit rating rating by affecting the economic, financial and balance of payments criteria of the country. In the statement made by S&P, it was reported that Israel's long and short term credit rating in terms of foreign currency and local currency was confirmed as "AA- / A-1 +" and the rating outlook as "stable". The statement said, "Over the past few days, security and political risks have sharply increased due to the escalation of social tensions within Israel, as well as the flare-up of conflicts with Hamas." The statement pointed out that the uncertainty in domestic politics has remained high due to the repeated elections in the last 2 years, but it has been stated that this situation has not significantly affected the Israeli economy so far. In the statement made by S&P, it was noted that Israel's financial measures could be negatively affected by the current military tension, but it is very difficult to measure them at the moment. Statement also said, "If the security and political risks due to the current tensions prolong, the pressure on ratings may increase by affecting Israel's economic, financial and balance of payments metrics." In the statement, he pointed out that the Israeli economy is expected to grow by 5 percent in 2021 with the effect of effective and rapid vaccination against the coronavirus epidemic, strong technology sector performance and increasing gas exports, it was underlined that the prediction in question was based on the assumption that the current military conflict and internal tensions were gradually decreasing and did not last long. The organization noted that the coronavirus epidemic significantly worsened Israel's public finances, but it was possible to mitigate the risks thanks to the positive debt structure, reliable monetary policy and strong balance of payments.