Ministry of Finance chief economist Shmuel Abramzon published the annual report on foreign investment this week, apparently bearing good news: in the first half of 2025, foreign investment in Israel jumped 35% in comparison with the corresponding period of 2024. A closer look at the report, however, reveals a more complicated picture, and figures that contradict data gathered by the Ministry of Finance itself that actually indicate a decline in precisely that period.
According to figures from the OECD, which are highlighted both in the chief economist’s press release and in the report itself, direct foreign investment in Israel in the first half of 2025 totaled $10.2 billion, making it the strongest half year since 2021. “The initial figures for 2025 indicate impressive recovery, testifying to foreigners’ growing confidence in the Israeli economy,” Abramzon writes in the introduction to the report.
Alongside the rosy OECD figures, however, the Chief Economist’s Department maintains an independent database on inward investment that was set up in 2020. What do the Ministry of Finance’s own numbers show? A 15% decline in the value of foreign investment transactions in the first half of 2025 in comparison with the corresponding period of 2024, and a 17% decline in the number of transactions. The Ministry of Finance’s more downbeat figures were hidden away. They were not mentioned at all in the press release, and in the report itself they appear in a short paragraph without any special stress.
The explanation for the contradiction lies in the different measuring methods. The OECD figures are based on actual cash flows into Israel, whereas the Ministry of Finance database monitors deals that have been announced, even if the money itself will follow later. “Since inward capital movements associated with transactions sometimes take place with a certain delay in relation to the date of the decision and the signature,” the report explains, the transaction database “makes it possible to identify trends and sentiment at an earlier stage.”
In other words, whereas the OECD figures reflect money that has actually come in, and may include flows from deals signed in the past, the Ministry of Finance figures reflect investors’ decisions in real time. And it is actually these figures, which the Ministry of Finance itself claims “make it possible to identify trends and sentiment at an earlier stage,” that show a decline.
The gap between these two sources is especially prominent when Intel’s $15 billion investment in expanding its fab in Kiryat Gat is taken into account. The deal was signed in December 2023. This deal, a one-time phenomenon in its size, affects any annual comparison. The report itself acknowledges this, and states that excluding the Intel deal inward investment rose 24% in 2024.
According to the OECD, inward investment into Israel totaled $14.8 billion in 2024, 9% less than in 2023, which is similar to the average decline in the OECD countries. Among the outstanding deals were the acquisition of WalkMe by German software giant SAP for $1.5 billion and investments by UK-based Energean, which controls the Karish and Tanin natural gas reservoirs off Israel’s coast, of $1.9 billion.
Published by Globes, Israel business news – en.globes.co.il – on December 10, 2025.
© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.
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