Israeli financial and defence officials were caught off guard on Tuesday after US President Donald Trump announced that Washington would end its annual military assistance to Israel by the end of 2026, two years before an existing security agreement is due to expire.
Trump said he had reached an agreement with Israeli Prime Minister Benjamin Netanyahu to terminate the funding, currently worth $3.8 billion annually, insisting that Israel no longer required American financial support.
Speaking to Fox News, Trump said the decision had been agreed upon months earlier and that Israel had accepted the arrangement.
He added that Washington would continue selling weapons to Israel and could provide additional assistance if necessary.
However, officials at Israel’s Finance Ministry said they had received no prior notification of the decision, according to Israeli media reports.
Senior economic officials told the Israeli newspaper Yedioth Ahronoth that the announcement could have serious consequences for the country’s economy.
One official warned that losing the remaining two years of assistance would leave an approximately $8 billion funding gap, potentially forcing the government to raise taxes to cover the shortfall.
Israel’s military was also reportedly surprised by the announcement and was examining its potential consequences for defence spending and future security agreements with Washington.
The existing US-Israel security memorandum, signed in 2016 under former President Barack Obama, provides $38 billion in military assistance over ten years, covering 2019 through 2028.
Under the agreement, Israel receives $3.3 billion annually in military financing and another $500 million for missile defence programmes.
Trump did not explain how the agreement would be terminated ahead of schedule or whether the decision would require congressional approval.
Netanyahu has previously expressed support for gradually reducing Israel’s dependence on American military assistance. However, the accelerated timetable announced by Trump appeared to surprise officials in Jerusalem.
The announcement came as Americans voted in the November 3 midterm elections, with US military support for Israel emerging as a contentious political issue.
Despite the proposed funding cuts, Trump maintained that Washington would continue supporting Israel if its security required additional American assistance.
