Report Summary

At the end of June the US Congress approved a US$170mn increase in security assistance for Israel, as part of a 10-year US$30bn defence aid commitment to the country. A US-based pro-Israel lobby, the American Israel Public Affairs Committee (AIPAC) welcomed the decision, saying it would boost US aid to Israel to US$2.55bn in fiscal 2009, up from US$2.38bn in fiscal 2008. AIPAC said the aid had added significance this year ‘as the US and Israel face new challenges from Iran’s drive to acquire nuclear weapons as well as the growing influence of radical anti-Western forces to Israel’s south in Gaza and to the north in Lebanon’ Although domestic and international relations are in trouble, BMI does not see a significant change to the level of threat to Israel’s security for the foreseeable future. Israel will continue to exist within a highly volatile region and be at risk of attacks from both internal and external parties. This is not new to Israel. It has existed under these conditions, and far worse, since its creation and has built up sophisticated and well tuned mechanisms for combating such threats. Whilst not numerically great, its armed forces are well-trained, well-armed and highly experienced. Perhaps more importantly, Israel is supported by the world’s only superpower, the US, which donates enormous quantities of military aid and equipment to the Israeli Defence Force (IDF). Israel’s armed forces are also supported by one of the world’s most advanced defence industries, which benefits from large amounts of support from the government in the form of contracts. Israeli arms exports are currently flourishing, with lucrative relationships created with major weapons purchasers such as India and Turkey. In 2006, transfers totalled some US$4.5bn, ranking Israel in the top five exporters in the world. Arms imports are also likely to be sustained at a significant level by several long-running procurement programmes and an increase in foreign military financing (FMF) from the US. BMI’s newly-released Israel Defence & Security Report concludes that the Israeli defence industry is set to thrive regardless of the immediate political or security environment in which it operates.