The shekel’s surge is turning export growth into a margin squeeze, with the dollar-shekel exchange rate falling below NIS 3 for the first time in more than 30 years and the dollar losing roughly one-fifth of its value against the shekel over the past year. For Israeli exporters, that means revenues are still booked in dollars while wages, energy, financing and most operating expenses remain in shekels, so each dollar earned buys less at home. The numbers may look tidy from the top floor, but down where the bills get paid, the squeeze is immediate.
Who Pays for the Strong Currency
According to Export Institute figures, 2025 was a record year for Israeli exports. Total exports reached $164 billion, up 10%. Services exports crossed $90 billion for the first time, while goods exports stood at about $72 billion. The article says those are impressive headline numbers, but that a dollar-denominated record means less when the dollar itself is weakening. It says the shekel’s appreciation is eroding those gains in real terms and that beneath the topline figures the gaps between sectors are widening.
The article says the United States is, and will remain, Israel’s most important strategic partner, and that the concentration of export exposure there matters. It says an analysis by the Israel Export Institute found that roughly 40% of Israel’s high-tech exports, about $38 billion, go to the US market. It says that since 2020, high-tech exports to the US have jumped by about 180%, and that this growth accounts for roughly half of the total increase in Israel’s high-tech exports over that period. The dependency is doing what dependencies do: narrowing the room to maneuver while the center of gravity sits elsewhere.
The Pressure Below the Charts
The article says that when profitability weakens and the customer base sits in the United States, companies eventually move closer to both, and that this process is already underway. It says the pace of new startup formation has slowed, recent Innovation Authority data showed a 6.5% decline in R&D roles, and more entrepreneurs are choosing to incorporate in Delaware. It says that if Israel stops giving companies strong reasons to stay, today’s export figures will become tomorrow’s relocation statistics.
The article says Israeli industry has spent six consecutive years in an unusually harsh operating environment: the COVID pandemic, inflation, high interest rates, the constitutional crisis, the Iron Swords War, the confrontation with Iran, a surging shekel and new US tariffs. It says there has been no true return to normal. It says industrial high-tech exports reached about $25 billion in 2025, still below their 2022 level, and that logistics constraints, airspace disruptions, reserve duty and shortages of foreign workers have hit industrial exporters especially hard. It says these are the companies that manufacture, hire and anchor Israel’s periphery.
Behind the charts and exchange-rate tables, the article says, stand a factory in the Galilee, an export manager in the south and a worker called up for yet another round of reserve duty while his company struggles to fill orders and keep production moving. It says this is the human face of currency appreciation and policy delay. The costs are not abstract; they land on workers, production lines and the regions that are supposed to hold the whole thing together.
What the Apparatus Says It Will Do
The article says the Bank of Israel has shown that it can act when necessary, noting that in October 2023 it launched emergency programs worth billions of dollars. It says the Bank of Israel also agreed to receive tax proceeds from the Wiz deal in dollars to help moderate pressure on the exchange rate, and that this kind of intervention matters but is not enough on its own. The apparatus can move money around, but the underlying squeeze remains.
The article says a government response has to match the scale of the problem and that Israel needs tax policy that takes currency appreciation into account, real support for exporters hedging foreign-exchange risk, faster removal of wartime regulatory and logistics barriers, incentives that keep R&D centers in Israel and relief for reserve soldiers employed in critical industrial sectors. It says the Finance Ministry, Economy Ministry, Israel Innovation Authority and Bank of Israel all need to be at the same table, and soon. The familiar ritual of coordination is presented as urgency, though the article makes clear that the pressure has already been building for years.
The article says there is also reason for confidence because Israel continues to produce major exits, attract billions in startup funding, rank among the world’s strongest concentrations of AI talent and join leading international technology frameworks, including the Pax Silica initiative. It says the country’s challenge is to turn technological excellence into broad-based national growth, and that success in cyber, software and exits has to strengthen the wider economy, including industry, manufacturing and the regions beyond the center.
The article says that in February the writer used these pages to call for an emergency roundtable on exports, and that two months later the exchange rate has fallen further and that table is still empty. It says Israeli exporters are not asking for favors, but are asking not to be left alone on the battlefield, and that at NIS 3 to the dollar, time matters. It says Israeli exporters do not need concessions, but need the conditions that keep them fighting, producing and winning.