Photo Credit: Hillel Maeir / TPS
Prime Minister Benjamin Netanyahu

Israel’s defense budget will be gradually increased to six percent of Gross Domestic Product (GDP) over the coming years, Prime Minister Binyamin Netanyahu said Wednesday as he presented a document labeled “Israel’s Security Outlook 2030” to the Security Cabinet.

The increase in the defense budget will total 0.2 percent to 0.3 percent of the GDP, translating at some NIS 2-4 billion per year.


Netanyahu said the defense budget would be re-examined once Israel’s GDP hit $500 billion. Israel’s GDP currently stands at some $350 billion.

The move marks a dramatic reversal in policy following decades in which the defense budget as a percentage of GDP has been in decline. In 2008 Israel spent 6.5 percent of GDP on defense and in 1992 the figure stood at some 15 percent.

The increased budget will go to the IDF, Israel Security Agency (Shin Bet), Mossad and other security agencies and will go, inter alia, toward strengthening Israel’s offensive capabilities, upgrading missile defense systems, completing security barriers, the home front and cyber capabilities.

“In view of Israel’s small size, the concentration of population and the numerous threats it faces, its defense needs will always be greater than those of countries of similar scale. The Israeli economy is strong enough to enable these budgetary additions,” Netanyahu said.

“Over the past two decades we have developed a free [market] economy in order to serve the needs of the state, first and foremost among them security. In the face of the threats we face, today we are at an inversion point. Today, we are required to invest more in security and defense to protect our achievements and ensure continued economic growth.

“The combination of our strong defense capabilities and our strong economy will increase Israel’s equity in the eyes of other countries and increase it diplomatic prowess.”