JERUSALEM, March 30 (Xinhua) -- The Israeli Finance Ministry announced on Monday a significant reduction in its 2026 growth forecast for the country's economy, citing the prolongation of war on the Iranian and Lebanese fronts.

Firefighters extinguish the fire in a building hit by Israeli drone strikes in Haret Saida, Lebanon, March 14, 2026. (File photo: Xinhua)

The original forecast of 5.2 percent was revised down to 4.8 percent in early March, shortly after the start of the U.S.-Israeli attack on Iran, based on the assumption that the fighting would be short.

However, as the conflict has continued, the ministry has further lowered its growth projection to 3.3-3.8 percent, depending on three wartime scenarios.

Under the first scenario, if fighting with Iran continues until mid-April and the conflict in Lebanon ends by the end of April, Israel's 2026 growth is expected to reach 3.8 percent.

In the second scenario, where fighting with Iran lasts until mid-April and the Lebanon frontline continues through the end of June, growth is projected at 3.5 percent.

In the third scenario, if the conflict with Iran extends until the end of April while fighting in Lebanon concludes by the end of June, the forecast stands at 3.3 percent.