Heads of Israeli companies braced for the impacts of sweeping tariffs announced by the Trump administration Wednesday, with some enacting temporary non-critical hiring freezes, and others reconsidering strategic business plans.
US President Donald Trump said on Wednesday that he would impose a 10% baseline tariff on all imports to the United States and higher duties on some of the country’s biggest trading partners, in a move that ratchets up a trade war that he kicked off on his return to the White House.
The new policy includes a 17% tariff on Israeli goods exports.
“From our recent conversations with Israeli high-tech CEOs and entrepreneurs, a recurring pattern has emerged. The first companies affected or shifting into a reassessment mode are manufacturing companies,” said Inbal Horesh, the CEO of Gifthead.
Horesh added that she is seeing “slight movement,” among companies with manufacturing companies “entering a state of ‘cautious waiting’—a temporary freeze on non-critical hiring and [making] an effort to understand the implications before making new decisions.”
Horesh stressed that this is “not a moment for panic,” but a time to “build action plans with several backup scenarios.”
Tom Koren, the CEO of Exelera – a subsea cable and digital infrastructure provider, said that he does not anticipate a significant impact on Israeli exporters.
“Many businesses have likely already accounted for tariff increases in their risk assessments, meaning that companies currently operating in the US market will not see drastic changes,” he said.
Nimrod Zvik, the CEO of Marom – Project 360, said that the tariffs and their consequences may affect Israel’s construction and real estate markets.
Key Israeli construction and infrastructure companies who provide technological solutions in these industries all operate in the US, he explained, saying that they now face new challenges posed by the tariffs.
“The increased tariffs are expected to hurt the profit margins of these companies, complicate exports, and make American projects that were once profitable less viable.”
There is also a concern that the tariffs could slow technological developments, delay investments, and reduce competition, he said, adding that these “could affect innovation levels, supply chain timelines, and construction costs in Israel.”
Assa Drori, the Chief Risk Solutions Officer at Okoora, said that the tariffs will “reduce the attractiveness of exporting goods from Israel to the US, as many other economic competitor countries face lower tariff rates than Israel.”
“Additionally, the imposition of tariffs is expected to strengthen the dollar against the shekel in the medium term, leading to price increases in Israel and making it more difficult for the Bank of Israel to lower interest rates.”
Drori added that “fortunately, most of Israel’s exports to the U.S. consist of services— some 62% of total exports in 2024, mainly from the high-tech sector—which are not subject to tariffs.”
This means that the impact on this sector will be minimal, he said.
Erez Menashe, CEO of Crown Neuromarketing, said that the decision has led to concerns for his client companies in the US and impacted their strategic business decision.
Decreased foreign demand, higher import costs
“Some are reconsidering whether to open branches in the US or instead focus solely on the EMEA (Europe, the Middle East and Africa) region, distancing themselves from the American market,” he said.
Danny Brietman, the CEO of Bimeniv Investment House and Bimeniv Finance College said that he is “seeing an immediate reaction in the financial markets—sharp declines in stock indices, especially for companies highly sensitive to international trade and cyclical economies.”
He added that while it does not seem to be causing a “severe slowdown” at this point, “there will be effects, primarily through decreased foreign demand and higher import costs.”
“There are no winners in trade wars—only losers. The primary risk is a wave of uncertainty, a slowdown in business activity, inflationary pressure, and the potential for a recession. All of these put pressure on the capital market in the short term,” he added.
Reuters contributed to this report.
Jesus Christ is King
Comments are closed.