Israel breaks records: The surge in foreign investment surprises the world
The Chief Economist's report reveals unprecedented record data on foreign investment in Israel, which recorded a 78% jump precisely at a time when OECD countries are seeing a completely opposite and particularly worrying trend for the rest of the world.
2025 was a record year for foreign investment in Israel, as the country managed to record a significant jump precisely during a period when a large part of developed economies were dealing with a decline in capital flow. According to the annual report of the Chief Economist at the Ministry of Finance, direct foreign investments in Israel totaled about $26.2 billion last year, a 78% jump compared to $14.8 billion in 2024.
The figure is particularly prominent against the backdrop of the global trend. While foreign investment in the world rose by about 6%, OECD countries actually recorded a decline of about 6%. Following the jump, Israel was ranked eighth among the organization's countries in the volume of foreign investment in absolute terms, and seventh when investments are measured relative to GDP.
The volume of investment deals in Israel also recorded a significant jump. In 2025, the value of deals reached about $36.6 billion, compared to $22.2 billion the year before, an increase of about 65%. This is a sum that even surpassed the record level recorded in 2021. However, the number of deals actually decreased, from 1,643 in 2024 to only 1,575 in 2025. This gap tells an important part of the story: the jump in the volume of funds was largely due to a number of mega-deals. Among the most prominent is the acquisition of the Israeli company Wiz by Alphabet, Google's parent company, in a deal estimated at about $32 billion. In addition, the acquisition of CyberArk by the American Palo Alto Networks was estimated at about $25 billion.
The distribution of investments also reveals how high-tech continues to be the central engine. About 90% of the value of the deals, which is about $33 billion, came from the software and information technology sector. In contrast, life sciences and health accounted for only about 3.4%, while communications amounted to about 2%.
The USA continues to be Israel's main partner in this arena. According to the Chief Economist's deal database, American investors were responsible for about $32 billion, about 90% of the total foreign investment in the database. Conversely, Europe's share shrank to about 7%, in the amount of about $2.5 billion.
The positive trend did not stop at the end of 2025. OECD data point to direct foreign investment in the amount of $14.1 billion in Israel already in the first quarter of 2026, the strongest quarter ever recorded. This is more than half of the volume of investment that entered Israel during the whole of 2025. At the same time, preliminary data from the Ministry of Finance point to deals in the amount of about $6 billion in the first quarter.
The Chief Economist at the Ministry of Finance, Dr. Shmuel Abramzon, said:
«2025 was characterized by the continuation of geopolitical and economic challenges in the country and the world, but despite this, Israel received a clear expression of confidence from foreign investors.»
However, the data present a complex picture. On one hand, Israel is succeeding in attracting huge sums and recording exceptional performance relative to other developed countries. On the other hand, a large part of the jump relies on individual mega-deals and on the technology sector, so the challenge will be to turn the exceptional momentum into a broader and more stable trend in the Israeli economy.
