2014 in Israel

U.S.-backed Israeli-Palestinian peace talks, launched in July 2013 under Secretary of State John Kerry, entered 2014 as a central diplomatic initiative.[1] The negotiations addressed the full range of core disputes: security arrangements, borders, Israeli settlements, Palestinian refugees, the status of Jerusalem, recognition of Israel as a Jewish state, and the future of Israeli military forces in the Jordan Valley.[2] As the talks approached a planned framework deadline in early spring, they began to unravel.[2]

The immediate causes of the collapse were multiple and mutually reinforcing. A planned fourth phase of Palestinian prisoner releases in early April did not occur amid widening disagreements over settlement construction and Palestinian demands for recognition.[3] The Palestinian Authority, led by Mahmoud Abbas, responded by seeking accession to international treaties and conventions rather than extending the negotiations.[2] Israel halted talks entirely after Fatah and Hamas announced a reconciliation agreement in April 2014, with the Israeli government refusing to negotiate with parties cooperating with Hamas.[1] On December 30, 2014, the UN Security Council rejected a Palestinian resolution calling for an end to the Israeli occupation and a timetable for withdrawal.[3]

Domestically, Prime Minister Benjamin Netanyahu's coalition entered 2014 under strain. The government faced public pressure over cost-of-living concerns, income inequality, and the contentious enactment of legislation intended to end the widespread exemption from military service for Haredi men — a reform that sparked fierce debate over equality and social integration.[4] Relations between Netanyahu's Likud and his centrist coalition partners, Finance Minister Yair Lapid and Justice Minister Tzipi Livni, were deteriorating over Palestinian policy, housing, budgetary priorities, and a proposed Jewish nation-state bill.[5]

According to a Jerusalem Center for Public Affairs overview, on June 12, 2014, three Israeli teenagers — Naftali Fraenkel, Gilad Shaer, and Eyal Yifrah — were abducted after being lured into a vehicle near Alon Shvut in the Gush Etzion bloc.[6] The same source described Operation Brothers' Keeper, launched in response, as the largest Israeli military deployment in the West Bank — known by its original, indigenous Jewish name of Judea and Samaria — since the height of the Second Intifada in 2002. During the operation, Israeli forces re-arrested 51 Palestinians previously released in the Gilad Shalit prisoner exchange.[6]

A separate JCPA account reported that the teenagers' bodies were found on June 30, west of Halhul, after an 18-day search.[7] The murders generated intense public grief and anger across Israel. Days later, on July 2, 16-year-old Palestinian Mohammed Abu Khdeir was abducted and murdered in East Jerusalem by Jewish extremists who said they were seeking revenge.[7] The killing led to riots and clashes in Jerusalem and around the Temple Mount.[7] The sequence of events — the kidnapping, the prolonged search, the discovery of the bodies, and the retaliatory murder — accelerated a cycle of violence that contributed to the escalation in Gaza.

Operation Protective Edge, the 50-day military confrontation between Israel and Hamas and other Gaza-based terrorist organizations, ran from July 8 through August 26, 2014, making it the third major conflict between Israel and Gaza-based groups since late 2008.[1][2] The immediate escalation included intensified rocket and mortar fire from Gaza beginning in late June and attempted infiltrations through tunnels; a JCPA overview also cited an anti-tank attack on Israeli troops and an attempted infiltration from the sea.[2][6] The INSS assessment characterizes the war as an escalation that neither side fully controlled, rather than a conflict simply planned in advance by Hamas.[1]

The Israeli government stated that Hamas and other organizations launched more than 4,500 rockets and mortars during the conflict, with approximately 4,000 deliberately aimed at Israel's civilian population.[8] Those attacks reached communities from the south of the country through Tel Aviv, Jerusalem, Be'er Sheva, and Haifa, with some projectiles reportedly supplied by Iran.[9] Residents near Gaza sometimes had 15 seconds or less to reach shelter.[8] The State Department's accounting recorded 4,465 rockets and mortar shells fired into Israeli territory from Gaza during the conflict, while the Israeli government reported conducting 5,242 airstrikes in Gaza over the course of the operation.[10]

Israel conducted an initial aerial campaign before sending ground forces into Gaza on July 17.[9] The ground operation, which lasted approximately 20 days, focused primarily on locating and destroying the network of cross-border assault tunnels that had become one of Hamas's primary strategic assets.[9][8] Israeli forces destroyed 32 cross-border tunnels, including 14 that penetrated Israeli territory.[8] They also found more than 60 tunnel shafts, with exit points under kibbutz dining halls, in fields near Israeli towns, and near border communities.[9] Each tunnel was estimated to require more than 4,000 tons of concrete and to cost more than one million dollars to construct.[9] On four occasions in July, armed Hamas terrorists emerged from tunnels into Israeli territory.[8]

Ground forces withdrew in early August, and an Egyptian-brokered indefinite ceasefire was reached on August 26.[9] Under its terms, Hamas committed to halt rocket fire, Israel ceased military operations, border crossings were to reopen for humanitarian and reconstruction supplies, and the permitted fishing zone was restored to six nautical miles.[9] The ceasefire also narrowed the security buffer near Israel.[11] The Fatah-Hamas unity government arrangement, which had preceded the conflict, effectively collapsed in its wake.[1]

The State Department reported 74 deaths in Israel during Operation Protective Edge: 67 combatants, six Israeli civilians, and one Thai civilian.[10] The Israeli government report stated that more than 1,600 Israeli civilians were harmed and that approximately 10,000 were evacuated from their homes during the conflict.[8] A JCPA casualty analysis reported a total of 842 Israeli casualties during the fighting.[12] The conflict imposed severe restrictions on civilian life across much of the country: public events including summer camps, weddings, and sporting events were prohibited within rocket range, and public bomb shelters were opened as far as 80 kilometers from Gaza.[6]

Palestinian casualty figures were significantly higher and sharply contested across reporting bodies. The UN estimated 2,205 Palestinian deaths, while the Israeli government put the figure at approximately 2,125.[10][8] The Israeli government reported that, as of April 2015, IDF experts had positively identified at least 44 percent of those killed as Hamas or other terrorist-organization militants.[8] By contrast, the UN Office for the Coordination of Humanitarian Affairs recorded 1,483 Palestinian civilian deaths, including 521 children and 283 women.[10] The Israeli government estimated that approximately half of those killed in Gaza were civilians and half combatants.[10] A December 2014 name-by-name analysis by the Meir Amit Intelligence and Terrorism Information Center examined 1,598 reported fatalities and classified approximately 45 percent of the fatalities it could identify as non-combatants and 55 percent as combatants.[12]

Beyond the death toll, the conflict produced extensive displacement and infrastructure damage in Gaza. OCHA estimated that approximately 520,000 people were internally displaced during the operation; by late August, more than 293,000 were sheltering in 85 UNRWA schools and another 45,000 in government facilities.[10] A December UNRWA assessment estimated that 96,000 Palestinian refugee dwellings had been damaged or destroyed.[10] UNICEF and other organizations reported that at least 373,000 children required direct and specialized psychosocial support in the aftermath.[10]

A JCPA overview reported that Israel facilitated the entry of 5,779 trucks carrying supplies and 20 million liters of fuel into Gaza during the conflict, while more than 4,000 Palestinians and foreign nationals crossed from Gaza into Israel and more than 250 ambulances made crossings.[6] It also reported that Israel continued supplying electricity to Gaza except where damaged lines could not safely be repaired.[6]

Jerusalem experienced a sustained wave of Israeli-Palestinian violence during 2014 that ran in parallel with, and in part fed into, the Gaza conflict. A JCPA study recorded rock throwing, firebombing, fireworks aimed at people, car rammings, and shootings along the seam between Jewish and Arab neighborhoods.[13] For the months of July through October alone, the study recorded approximately 13,000 incidents involving rocks, firebombs, and fireworks, along with three car rammings and two shootings targeting Jews.[13]

The same study reported that Temple Mount tensions intensified dramatically during the autumn. On October 29, a gunman attempted to assassinate Rabbi Yehuda Glick, a prominent advocate for Jewish prayer rights on the Mount.[13] Jordan responded by recalling its ambassador to Israel for consultations and said it would re-examine aspects of its 1994 peace treaty with Israel.[13] On November 5, police entered the al-Aqsa mosque after receiving intelligence that weapons had been stored there for attacks on visitors and police; officers confiscated racks of firework-launching tubes, rocks, and firebombs.[13]

The peak of the Jerusalem violence came on November 18, 2014, when two Palestinian cousins armed with axes, knives, and a gun entered the Kehilat Bnei Torah synagogue in the Har Nof neighborhood during morning prayers.[14][10] Five people were killed — Rabbis Moshe Twersky, Aryeh Kupinsky, Avraham Shmuel Goldberg, and Kalman Levine, and a Druze police officer — while six additional congregants and another officer were wounded.[14] Police arriving at the scene exchanged fire with the attackers and killed both of them.[14] The JCPA study reported that, during the first four months of the Jerusalem violence, approximately 1,000 rioters were apprehended and some 300 were charged.[13]

A separate terrorist incident occurred on November 10, when a Palestinian attacker stabbed an Israeli soldier at a Tel Aviv bus station; the soldier later died of his wounds.[10]

By late 2014, disputes within Netanyahu's coalition had reached a breaking point. Disagreements with centrist partners over the 2015 budget, settlement construction, Palestinian policy, defense spending, housing, and the proposed Jewish nation-state bill intensified in December.[5][3] The nation-state bill was criticized by Justice Minister Tzipi Livni, Finance Minister Yair Lapid, international observers, and former President Shimon Peres, who said it would "destroy Israel's democratic status at home and abroad."[5]

On December 2, 2014, Netanyahu dismissed both Lapid and Livni, accusing them of attacking his government from within the cabinet.[15] Netanyahu announced he would seek the dissolution of the Knesset and a fresh public mandate to govern.[15] The INSS assessment also identified disputes over the Israel Hayom press bill as a contributing factor in the coalition collapse.[16] The Knesset passed the Law for the Dissolution of the 19th Knesset on December 8, with 93 of 120 members supporting dissolution and the remainder abstaining.[17][4] The 19th Knesset had served less than two years of its term.[17]

Polls conducted in November and December projected a right-wing bloc of 70 to 75 Knesset seats under Netanyahu's leadership.[16] Early elections were scheduled for March 17, 2015.[4] The 2014 Governance Law also raised the electoral threshold from 2 percent to 3.25 percent, encouraging smaller parties — particularly Arab parties — to form joint electoral lists for the forthcoming vote.[5]

In April 2014, Fatah and Hamas announced an institutional reconciliation agreement, subsequently establishing a Palestinian consensus government headed by Prime Minister Rami Hamdallah.[1] Under the agreement, Hamas committed in principle to transfer civilian control in Gaza to the unity government, permit Palestinian Authority security personnel to deploy at the Rafah crossing, join the PLO, and hold elections within six months.[1] By June, a formal consensus government had been announced, intended to end seven years of divided Palestinian rule.[2]

Israel opposed the arrangement from the outset, threatening not to negotiate with any Palestinian leadership that cooperated with Hamas, and imposing economic sanctions on the Palestinian Authority.[1][3] Hamas retained de facto control over Gaza throughout, and the arrangement raised fundamental questions about whether the Palestinian Authority could exercise real authority there or whether Hamas would cede control of Gaza's security.[2] The arrangement effectively collapsed after Operation Protective Edge, which consumed the political energy of both parties and foreclosed the consensus government's short window of operation.[1]

In June 2014, the Knesset elected Reuven Rivlin as Israel's tenth president.[2] Rivlin, a Likud politician and former Knesset speaker, took office in late July, succeeding Shimon Peres.[2] The Israeli presidency is largely ceremonial, while executive authority rests with the prime minister.[2] Ariel Sharon, the former soldier and prime minister, died at the beginning of 2014.[18]

Operation Protective Edge left a visible mark on Israel's macroeconomic performance. The Bank of Israel's 2014 economic review found that GDP grew by 2.8 percent in fixed prices, compared with 3.2 percent in 2013 and below the estimated 3 to 4 percent annual growth potential.[19] Per-capita GDP rose by 0.8 percent, compared with 1.3 percent the previous year.[19] The Bank of Israel estimated total GDP loss from the conflict at NIS 3.5 billion, including approximately NIS 2 billion in lost tourism services and NIS 1.5 billion from reduced private consumption.[19]

The INSS survey offered a broader range of estimated wartime losses: between 10 and 20 percent of daily GDP was lost over 43 workdays, equivalent to NIS 18 to 36 billion, or 1.7 to 3.4 percent of annual GDP.[1] The government's fiscal position nonetheless remained manageable. The 2014 budget deficit came in at NIS 29.9 billion, or 2.8 percent of GDP, below the original NIS 31.1 billion target, as higher-than-forecast tax revenues and lower-than-planned expenditure partially offset the war's costs.[20] Government debt rose from NIS 696.3 billion in 2013 to NIS 715.8 billion in 2014.[20]

Defense consumption reached NIS 62.5 billion for the year, with local defense expenditure representing 4.8 percent of GDP, up from 4.6 percent in 2013.[1] The government ultimately accepted a NIS 7 billion estimate for the operation's direct cost — between the Defense Ministry's NIS 9 billion estimate and the Finance Ministry's NIS 5 billion estimate.[1] Tourism was particularly hard hit: Israel recorded approximately 3.3 million visitors in 2014, a 7 percent decline from 2013, with visitor numbers falling roughly 30 percent in July during the conflict and remaining about 20 percent below the prior year's level for the remainder of the year.[21]

The conflict affected the economy mainly through downward pressure on demand rather than supply, particularly in transportation services and hospitality, though services consumption recovered relatively quickly afterward.[22] The government approved a NIS 60 million reconstruction and rehabilitation package in August 2014 for Sderot and communities bordering the Gaza Strip, including rebuilding public spaces, sports facilities, parks, and reinforced day centers.[23]

Despite the turbulence of the year, Israel's technology and innovation sectors posted landmark results. Israeli high-tech and life-sciences companies raised $3.4 billion in 2014 — an all-time record and a 46 percent increase over the $2.3 billion raised by 659 companies in 2013.[24] Fourth-quarter fundraising alone reached $1.1 billion, the largest quarterly amount since 1999, and approximately 39 companies completed financing rounds exceeding $20 million.[24]

High-tech exits reached a record $15 billion, approximately double the $7.6 billion recorded in 2013, encompassing 70 initial public offerings and mergers and acquisitions compared with 45 such transactions the previous year.[25] On U.S. capital markets specifically, Israeli companies conducted 26 technology and biomedical offerings in 2014, raising a record $3.6 billion and surpassing the previous record of $3.3 billion set in 1999.[26]

The year's largest Israeli Wall Street offering was the New York Stock Exchange IPO of Mobileye, an Israeli driving-assistance company whose camera-based system detected road hazards and issued audible and visual warnings.[26][27] Mobileye raised $890 million at a valuation of $5.31 billion; after underwriters exercised a greenshoe option, the total reached approximately $1.023 billion.[27] On its first trading day the share price closed 48 percent higher, giving the company a market capitalization of $7.86 billion.[27] The offering was described as the largest Israeli issue ever on Wall Street at that time.[26]

Business product grew by 2.7 percent overall during the year, private consumption increased by 4.0 percent, and public consumption rose by 4.2 percent, though fixed-asset investment declined by 2.5 percent and exports of goods and services grew by only 1.3 percent.[28] Israel's technology industry showed no measurable dent during the military conflict, while traditional manufacturing suffered a mild impact.[22]

Israel's natural-gas sector advanced rapidly during 2014. The Tamar consortium reached a 15-year gas-supply agreement with Jordan in February, and in May signed a letter of intent to supply gas to an Egyptian liquefied-natural-gas facility.[2] The Leviathan consortium signed a June memorandum of understanding with Britain's BG Group concerning supply to another Egyptian LNG facility.[2] In December, Israel's Antitrust Authority declined to approve a consent decree for Leviathan over concerns about monopoly effects, prompting the government to establish a committee to seek a resolution.[2]

On the international diplomatic front, the United States-Israel Strategic Partnership Act of 2014 became Public Law 113-296 on December 19.[29] The law formally declared Israel a major strategic partner of the United States and authorized expanded cooperation in defense, homeland security, cybersecurity, energy, trade, research, and technology.[29]

On January 15, 2014, Israel was admitted as a full member of CERN, becoming the organization's 21st member state and the first new member since 1999.[30]

Jewish immigration to Israel reached a ten-year high in 2014, with 26,508 new immigrants arriving, compared with 19,023 in 2013.[31] France became the leading country of origin for aliyah for the first time in Israel's history, supplying approximately 7,000 immigrants.[32] Ukraine contributed approximately 5,840 immigrants, a 190 percent increase attributed primarily to instability in eastern Ukraine.[32] Tel Aviv absorbed the most newcomers among Israeli cities, followed by Netanya and Jerusalem.[32]

Israel's total population reached 8.296 million on the eve of 2015, growing by 2 percent — approximately 162,000 people — during the year.[33] The population comprised approximately 74.9 percent Jews, 20.7 percent Arabs, and 4.3 percent classified as others.[33] Some 176,600 babies were born during the year.[33] Using end-of-2013 city figures, Jerusalem was listed as Israel's largest city, with 829,900 residents, followed by Tel Aviv-Yafo with 418,600 and Haifa with 273,200.[34] Universities and colleges enrolled 264,844 students during the 2013-14 academic year.[34]

The global Jewish community faced an alarming surge in antisemitic violence in 2014. The Kantor Center registered 766 violent antisemitic acts worldwide, a 38 percent increase from 554 in 2013 and approximately 40 percent above the 2004-2014 decade average.[34] The breakdown included 68 attacks with weapons, 101 weaponless violent incidents, 412 acts of vandalism, 114 attacks on synagogues, 57 attacks on community centers and schools, 118 attacks on cemeteries and memorial sites, and 171 attacks on private property.[34] The Kantor Center characterized 2014 as the second-worst year of that decade, after 2009.[34]

The increase in antisemitic manifestations was linked partly to Operation Protective Edge, which generated a wave of hostility toward Jews in Europe and elsewhere during the second half of the year, though the first half had already been difficult.[34] The report documented the June kidnapping and murder of the three Israeli teenagers, the summer Gaza conflict, and the November Har Nof synagogue attack as major Israel-related developments that fed into the international atmosphere.[34] The Kantor Center distinguished criticism of Israeli policy from antisemitism but identified Nazi comparisons, blood-libel imagery, Holocaust comparisons, conspiracy theories, and attacks on Jewish institutions carried out explicitly because of Israel's actions as antisemitic in character.[34]

The year brought several other notable developments in Israeli public and cultural life. An Israeli scholar studying the Dead Sea Scrolls discovered nine tiny unopened phylactery parchments from Qumran that had been overlooked during approximately six decades of research; the parchments were expected to illuminate religious practices during the Second Temple period.[18]

The High Court of Justice struck down the 2013 amendment to Israel's Prevention of Infiltration Law on September 22, ordering the Holot detention facility closed within 90 days and ending mandatory roll calls within two days.[10] A subsequent Knesset amendment limited Holot detention to 20 months and permitted up to three months of initial detention for newly arrived asylum seekers.[10] Approximately 6,000 irregular migrants and asylum seekers departed Israel through a voluntary-return program during the year, with the government paying returnees a $3,500 stipend.[10]

In December 2014, the IDF spokesman announced that recommendations from the Fact Finding Assessment Mechanism had led to eight additional criminal investigations being opened, while another 85 cases connected to Operation Protective Edge remained under review.[6]

The events of 2014 left a complex and contested legacy across Israeli politics, security, and society. Operation Protective Edge neither resolved the underlying conflict with Hamas nor produced a durable political arrangement in Gaza; the Fatah-Hamas unity government collapsed, Hamas retained control of the Strip, and the underlying tensions that had generated the war remained intact.[1] The tunnel network, despite the destruction of 32 cross-border tunnels, became a defining symbol of a new phase in the security challenge Israel faced from Gaza.[9][8]

The year's diplomatic failures were equally consequential. The collapse of Kerry's mediation effort left the Israeli-Palestinian peace process without an active negotiating framework, and the year ended with the UN Security Council rejecting a Palestinian resolution setting a timetable for Israeli withdrawal.[3] Israel's international standing was strained by the conflict, while the global surge in antisemitism demonstrated the degree to which events in the Middle East reverberated among Jewish communities worldwide.[34]

Domestically, the dissolution of the 19th Knesset and the calling of early elections reshaped Israel's political landscape heading into 2015. The debates that had torn the coalition apart — the nation-state bill, Haredi military service, the budget, and relations with the Palestinians — carried forward into the campaign.[5][3] At the same time, Israel's record-breaking technology sector, ten-year-high aliyah figures, CERN membership, and the new strategic partnership act with the United States offered evidence of the country's resilience and continued international integration despite the year's extraordinary pressures.[30][29][24][25]

Several aspects of 2014's major events remain subjects of genuine factual or interpretive dispute. Palestinian casualty totals and the proportion of civilians among those killed during Operation Protective Edge vary substantially among the Israeli government, the UN Office for the Coordination of Humanitarian Affairs, and other bodies; the sources present different methodologies rather than a single reconciled account.[10][8] The precise duration of the operation is also reported differently across sources, with some accounts giving 50 days and others 51, and with the start date given variously as July 7 or July 8.[1][35]

The causes of the Gaza escalation are similarly contested: whether Hamas deliberately initiated the war, whether the conflict emerged through uncontrolled escalation, and how responsibility for civilian harm during the fighting should be apportioned are questions on which reporting bodies and governments reached different conclusions.[1] Accounts of the coalition collapse also differed over the relative importance of the budget, the Israel Hayom bill, the nation-state bill, and Netanyahu's stated concern about opposition from within his cabinet.[16][15]