Amid intensifying conflict in Gaza, several prominent European financial institutions have opted to scale back their ties to Israeli companies, citing a mix of activist pressure, ethical concerns, and perceived risks. While these moves highlight shifting dynamics in the global financial landscape, Israel remains resilient, with its economy continuing to attract investors undeterred by political headwinds.
Leading banks and asset managers, including Norway’s Storebrand and France’s AXA, have divested from certain Israeli firms in recent months. Some decisions appear tied to concerns over compliance with international law and human rights, particularly regarding business activities linked to the Palestinian territories. For example, Storebrand’s annual investment review cited ethical concerns as it excluded 24 companies—some Israeli—from its portfolio. Similarly, AXA confirmed its reduced holdings in certain Israeli banks but noted it maintains other investments.
Israel’s Finance Ministry has refrained from commenting on specific actions but continues to emphasize the country’s economic resilience. “Despite challenges, investors see long-term opportunities in Israel’s economy,” the Finance Minister recently stated, adding that foreign investments remain steady in critical sectors like technology, energy, and defense.
Analysts note that some European firms’ decisions align with broader institutional policies on environmental, social, and governance (ESG) criteria. Yet, critics argue such measures unfairly single out Israel, given the lack of comparable divestments in other conflict zones. Supporters of Israel’s economy point out that its innovation-driven industries—ranging from high-tech to water technology—have consistently proven their global value.
A notable case is the ongoing relationship between Israel and the UAE under the Abraham Accords. Despite regional tensions, bilateral trade has remained robust, though Emirati business circles are proceeding with greater discretion. Similarly, Israeli tech and defense exports continue to attract attention from Asia and North America, mitigating any fallout from European policy shifts.
Israel’s advocates argue that withdrawing financial support in such a manner risks empowering groups like Hamas, the internationally recognized terrorist organization responsible for the October 7 attack that triggered the current conflict. They emphasize that Israel’s economic stability is crucial not only for the region but also for its role as a global technology leader.
While some European firms have chosen to distance themselves, Israel continues to adapt and diversify its investment base. Its robust entrepreneurial ecosystem, coupled with unwavering support from key allies like the United States, underscores the enduring strength of its economy even in challenging times.
