Israel's Foreign Investment Hits Record High in 2025 Amid Mega-Deals

Foreign direct investment in Israel reached a record $26.2 billion in 2025, a significant 78% increase from $14.8 billion in 2024, according to a report from the Israeli Ministry of Finance's chief economist. This figure surpasses the previous record of $22.9 billion set in 2021. The report, based on OECD data and the ministry's own transaction database, indicates that Israel ranked eighth among OECD countries for absolute investment volume and third when measured as a percentage of GDP. This growth occurred despite a global trend of declining foreign investment in developed nations, which saw a 6% decrease within the OECD and an 8% drop in the United States.

While the overall investment value soared, the number of transactions actually decreased by 4% compared to 2024 and nearly halved since 2021. This suggests the record sum was driven by a few exceptionally large deals rather than a broad increase in investment activity. The most significant transaction was Google's acquisition of cybersecurity firm Wiz for $32 billion, with an estimated $16.8 billion contributing to Israel's economy. The acquisition of CyberArk by Palo Alto Networks for $25 billion added an estimated $2.5 billion.

Software and information technology dominated these investments, accounting for approximately 90% of the total value, or $33 billion. Even excluding the Wiz deal, the sector represented 80% of investments. Life sciences and health, the second-largest sector, attracted only $1.3 billion. The United States was the primary source of investment, contributing nearly 90% of the total value recorded in the Finance Ministry's database, while European investment saw a significant decline.

Separately, a study by the Israel Securities Authority found that shifting the Tel Aviv Stock Exchange's trading week to Monday-Friday, with Friday as the new trading day, has doubled trading volume on Fridays and increased foreign investors' share of the market by 2.5 times. The average daily trading turnover increased from 1.3 billion shekels before the reform to 2.6 billion shekels on Fridays afterward. Foreign investors' participation in Friday's trading rose to 38.2% from 15.3% previously, while remaining stable on other weekdays.