Both Russia and Israel are currently in wartime economies, but their economic status is very different.
In this article, I will compare and analyze the reasons behind the wartime economic differences between Russia and Israel.
Let's start with the state of Israel's economy.
Israel's GDP shrank by 19 percent on an annualized basis in the fourth quarter of last year4%。
It should be noted that this is an annualized rate, not a year-over-year figure that is easier for us to understand.
Israel's GDP fell by 5% in the fourth quarter of last year from the previous quarter2%, which means that if Israel follows this month-on-month decline in the next year, then the annual GDP will fall by 194%；
Therefore, this is an expected decline on an annualized basis, not a year-over-year decline.
Western countries prefer to use annualized GDP to calculate quarterly GDP, while we are accustomed to using year-on-year data directly.
If converted to year-on-year data, Israel also fell by 3 percent year-on-year in the fourth quarter of last year5%, which is actually a large decline.
Israel's normal economic growth rate before the epidemic was about 4%, which is not bad overall.
Before the outbreak of the Palestinian-Israeli conflict, Israel's GDP grew at a quarterly rate of around 3%.
So, this is down 3 percent year-on-year5% is a huge drop.
According to the Times of Israel, in the fourth quarter of last year, Israeli private consumption fell by 269%, and imports of goods and services ** fell sharply by 424%, and the decline in exports was 183%, fixed asset investment fell by 678%。At the same time, Israel's fiscal spending soared by 88 percent due to military spending1%。
Israel's economic data in the fourth quarter of last year was indeed terrible, and it was greatly affected by the Palestinian-Israeli conflict.
In early February, Moody's, an international rating agency, downgraded Israel's sovereign credit rating to A2 from A1 with a negative outlook, citing the impact of military operations in the Gaza Strip on Israel's ** debt burden, as well as fiscal and political risks.
The fact that Israel's economy is so bad is mainly related to Israel's previous general mobilization.
After the outbreak of the Palestinian-Israeli conflict on 7 October, Israel carried out the so-called general mobilization of 300,000 people, which is very exaggerated.
The population of Russia is 14.4 billion people, 300,000 reservists will be partially mobilized in 2022, which is an acceptable level for Russia.
However, Israel's population is only 9.55 million, with 3.09 million minors and 1.16 million elderly people over 65 years old, deducting the old, weak, sick, disabled, pregnant and young, and deducting 1.2 million Haredi who are not productive and do not serve in the military, and Israel has less than 4 million people left who are suitable for conscription.
In this case, Israel mobilized 300,000 reservists, a mobilization rate of nearly 10%, which is quite an exaggerated figure, which is already close to the level of mobilization in World War II.
After the outbreak of the Palestinian-Israeli conflict, a considerable part of Israel's young and middle-aged population has been recruited, which are all important labor resources in Israel, so in the past few months, there has been a serious gap in the employment rate of Israeli enterprises, which is the main reason for affecting the Israeli economy.
In addition, before the outbreak of the Israeli-Palestinian conflict, a significant proportion of the Arab population in Israel was engaged in basic labor.
Seventy-four percent of Israel's population is Jewish, but 21 percent are Arab.
In the aftermath of the Israeli-Palestinian conflict, there has been a serious rift in trust between Jews and Arabs in Israel, and Israel has terminated employment permits for a large number of Arabs in the West Bank, which has also exacerbated Israel's labor shortage.
Israel's poor wartime economic performance also has something to do with the structure of the Israeli economy.
Although Israel is located in the Middle East, it is a resource-poor country, so Israel mainly develops low-energy, capital- and technology-intensive industries.
Israel's domestic market is relatively small, and its economy is very dependent on foreign countries.
Resources need to be imported, and the goods produced are mainly digested by exports.
The European Union is Israel's largest partner, and the United States is the largest single partner.
Israel is also a country with a chronic deficit.
In 2021, Israel's total foreign exports totaled $145.4 billion, of which $89.1 billion was imported and $56.3 billion was exported.
Israel's economic structure, in fact, is very resistant to war.
For example, this time the Houthis blocked the entrance to the Red Sea and attacked merchant ships heading to Israel, which actually had a great impact on the Israeli economy.
Israel's own economic and demographic size also determines that Israel's war potential is not so strong.
The reason why Israel was able to win the previous wars in the Middle East was mainly because of US aid and support.
This is also why after the outbreak of the Palestinian-Israeli conflict, the United States has continued to provide assistance to Israel, because Israel alone is not enough to sustain the Palestinian-Israeli conflict.
Therefore, on January 1 this year, the Israeli military said that Israel would withdraw some of its troops from the Gaza Strip in favor of more targeted actions against Hamas and return some reservists to ordinary life to help the country's economic development and prepare for a long war.
In fact, this is because Israel is not enough to maintain this state of full mobilization for a long time, and Israel's economy cannot sustain itself, so it is down the slope that it has partially withdrawn its troops.
This is not to say that Israel will not fight, it is purely that the Israeli army is fighting too much, let alone quickly eliminating Hamas, and it does not even have the ability to maintain high pressure for a long time.
Therefore, we can only obey the steps given by the United States and turn the all-out attack on Hamas into a focused offensive.
Now that Israel has rested for two months and taken a breath, it immediately says that it will launch a ground offensive against Rafah.
In terms of military strength and economic strength, it is difficult for Israel to say that it can take charge on its own, and it is even so difficult to fight Hamas, and without US assistance, it will be difficult for Israel to gain a foothold in the Middle East.
This is dictated by Israel's size and structure.
In contrast, Russia's population and economy are far from being comparable to Israel's.
This is the main reason why Russia has been able to maintain good economic growth after two years of wartime economic growth.
Over the past year, Russia's GDP has grown by 35%, industrial production grew by 36 percent, and manufacturing production grew 7 percent5%；
Russia and Israel, both in wartime economies, have such a big difference in performance, which is also related to the structure of their respective economies.
Russia is a resource-exporting country, and resources as a whole are hard currency, even if Russia is extremely sanctioned by Europe and the United States, but Russia's resources can still maintain normal exports.
By the end of 2023, Russian oil and gas revenues have returned to 2021 levels.
Energy exports account for 27% of Russia's GDP, and energy export earnings account for 57% of the country's total export earnings.
Therefore, energy exports are the lifeblood of Russia's economy.
After being subjected to extreme sanctions by Europe and the United States, only 15% of oil currently goes to Western markets, while 85% of Russian oil is exported to the East.
In addition, a large amount of Russian oil passes through the transit station of India, and after being transferred by India, it continues to be exported to Europe.
In addition, Russia is a major agricultural country and a major exporter of fertilizers, which is also a hard currency, and according to preliminary estimates, agricultural production could grow by 2% in 2023. Russia's agricultural exports exceeded $45 billion for the first time in 2023, a new record, the Ministry of Agriculture said.
Then there is the military industry, although the Russian manufacturing industry has gone through more than 30 years of decline, the Russian military industry is still one of the main components of the international market.
After the outbreak of the Russian-Ukrainian conflict, Russia entered a wartime economy, of which the fastest growing is the military industry, according to the budget, defense spending in 2024 will account for 29% of Russia's total spending4%, ranking first in budget expenditure.
Although the Russian economy as a whole is doing well, it also has some problems of its own.
For example, Russia is still facing high inflationary pressure, and after the outbreak of the Russia-Ukraine conflict, the inflation rate in Russia once reached 178%, after a year of decline, there are still 74% inflation.
Russia's response is mainly by raising interest rates, which are currently as high as 16%;
In addition, due to the more extreme financial sanctions imposed by the United States on Russia, the ruble also has some depreciation pressure.
However, the ruble has seen big ups and downs in 2022, with a large appreciation in 2022, but it will also depreciate significantly in 2023, and it has stabilized slightly overall in the two months of this year.
At present, the ruble exchange rate has depreciated only slightly compared to 2021, from 75 rubles per dollar to 90 rubles.
Despite extreme sanctions from Europe and the United States, the ruble has not collapsed like Argentina.
In addition, Russia is also currently facing a labor shortage, after all, Russia also partially mobilized 300,000 people in 2022.
But Russia's labor shortage is not as serious as Israel's.
In general, although the Russian economy is inevitably facing some problems due to extreme sanctions from Europe and the United States, the Russian economy has maintained a relatively good operation in the past two years.
In addition to factors such as Russia's own economic structure and war potential, we insist on maintaining normal relations with Russia under tremendous pressure, which is an important factor.
Israel's wartime economy is so poor, in addition to Israel's own poor war potential, the most important thing is that Israel is not backed by a manufacturing power.
And the first-chain system "headed" by the United States obviously cannot provide sufficient support to Israel.
In addition, there are frequent attacks by the Houthis on ships heading for Israel in the Red Sea, and the US military hegemony now does not dare to carry out ground attacks on the Houthis, but can only engage in air strikes, but this obviously cannot prevent the Houthis from carrying out air strikes.
The military hegemony of the United States and the first-chain system led by the United States cannot effectively support Israel and allow Israel to maintain a good wartime economy for a long time.
And the first-chain system dominated by us can allow Russia to continue to maintain rapid growth in a wartime state.
I believe that countries can see more clearly the difference between us and the United States through the Russia-Ukraine conflict and the Palestinian-Israeli conflict.
This is the greatest change unseen in a century, and it is the process of changing the old and new international order.
This is a change in the international order from the post-World War II model with US hegemony at its core to a truly multipolar era, and we will surely occupy the most important pole.
Of course, we can't be blindly optimistic.
In the process of the decline of US hegemony, the United States is bound to take risks and will struggle to the death.
Whether the United States is constantly arching the flames all over the world, or whether it is engaged in this kind of long-term soft decoupling with us, is the United States in a dying struggle to maintain its hegemony.
And this is bound to cause us labor pains as well.
However, as long as we get through this painful period and wait for the US hegemony to truly collapse, we will naturally usher in a new round of development.
Now it's more about getting ready.
In the world of great contention, there is vitality in struggle.
If you don't fight, you will be slaughtered.
This article **"Big Vernacular Current Affairs**
Author: Star Talk. **10,000 Fans Incentive Plan