Reforms Urged to Cope With Long War and Cooling Growth

Economists tell TheMarker policy makers must look to budget to revive the economy and peace accord to end fighting.

There have been two critical developments for the Israeli economy in the past week, both of which bode ill for future growth. One was the failure of Israel and Hamas to put a decisive end to the war in the Gaza Strip, which threatens to turn into a war of attrition. The other was the Central Bureau of Statistics' first readout of second-quarter economic developments, which pointed to a steep drop in growth.