Israel's Hotel Reform: Government Launches Credit Fund
Israel's Ministry of Tourism has proposed a credit fund with state guarantees of 400 million shekels to support the hotel sector. The industry is experiencing a downturn: in the first five months of 2026, about 6 million overnight stays were recorded (84% by local tourists), compared to 7.8 million a year earlier. Revenue in the first quarter fell to 2 billion shekels from 2.4 billion. The authorities aim to attract 7 million tourists by 2030.
Israel's Ministry of Tourism has proposed creating a credit fund with state guarantees of 400 million shekels to support the hotel sector. The ministry's director general, Michael Itzhakov, approached the Finance Ministry with this initiative amid an acute financing shortage for developers. The industry is experiencing a downturn: in the first five months of 2026, hotels recorded about 6 million overnight stays (84% by local tourists), compared to 7.8 million a year earlier. Revenue in the first quarter fell to 2 billion shekels from 2.4 billion. The authorities aim to attract 7 million tourists by 2030, which requires expanding the room inventory. The fund is intended to catalyze private investment. Measures already taken include the 'Lighthouse' unit to support entrepreneurs, urban planning reforms, and a reform allowing up to 49% of hotel project areas to be allocated for housing.