Deliveries of some weapons and ammunition purchased from Israel by Estonia may be delayed for several months due to the Israel-Hamas war. The mobilization of reservists has slowed down production.
Estonia buys anti-tank missiles, anti-ship missiles, machine guns, and ammunition from Israel. Contracts have been signed with several big Israeli defense industry companies, said Magnus-Valdemar Saar, director general of the Estonian Centre for Defence Investments (RKIK).
"We know that something is coming from Israel this year. In this sense, Israeli companies have been very thorough in honoring their international commitments and standing by their promises. At the same time, we also know that we have a number of contracts and categories where, precisely because of this ongoing war, deliveries are delayed. We know with a fair degree of certainty today that they should be arriving in Estonia somewhere around the end of the first quarter, beginning of the second quarter [of 2024]," he said.
Saar said he was told by the supplier's CEO that they had personally inspected the deliveries being sent to Estonia.
After Hamas' attack on October 7 which killed 1,200 people, the Israeli government mobilized 360,000 reservists.
The Israeli military responded with air strikes on Gaza, and launched a ground offensive. More than 18,600 people have been killed in Gaza, according to the Hamas-run government.
Some of these reservists also worked in the defense industry which has slowed down production. While those gaps have now been filled, Israel also needs more ammunition as it continues its ground invasion of Palestine.
"For example, Elbit, which is a participant in our contract for large-caliber ammunition, has said that they will not be participating in our mini-competitions in the near future and will not be bidding, precisely because there is more need for this ammunition in Israel at the moment," Saar explained.
It is difficult to accurately assess how much the war costs Israel.
In November, the Bank of Israel estimated the war's impact on the country's economy is approximately €600 million per week. This also included two weeks when schools were closed and many parents could not go to work. While the news portal Bloomberg reported the Israeli Ministry of Finance estimated each day of war costs the state €240 million.
A lot depends on how long Israel will continue with its large-scale military operations and how long reservists will be required to participate.
Indrek Kannik, director of the Tallinn-based International Center for Defense Studies (ICDS), said Israel values its security above all else.
"I do not think they are looking at it in such a way that they have to end this war for the sake of the economy. They are prepared to end this phase of the war when they are confident enough that they have damaged Hamas enough that Hamas, at least for a time – we can never talk about it being forever – let's say seven to ten years, will not be able to repeat something like they did on October 7," Kannik said.
Israeli politicians believe the current more active phase will last for several weeks, he said. Reservists may then gradually be released from service.
But Kannik acknowledged that there is still no definitive solution in sight.
"Israel has made it relatively clear that it will not surrender this territory to Hamas or Fatah. The latter is the organization that exercises some power in the West Bank. Israel does not believe that either organization would be able to prevent further attacks against Israel from there," the director said.
At the same time, Israel's supporters, including its biggest ally the United States, do not want Israel to occupy these areas.
"I think there is an attempt to find some kind of compromise solution in the form of Israel inventing some kind of security clearance. Ensuring, for example, that some of the back roads through the region are under its control. But I still don't see who is going to exercise municipal authority there," Kannik said.
The impact of Israel calling up its reservists is also an example Estonia can learn from, he said. As the threat grows, reservists cannot be called up too soon.
But the expert said this is also something that countries need to be prepared for. In Estonia, families should think about what they would do if a family member needs to be away for several months.
"Similarly, companies need to think more broadly about how they can maximize their ability to keep their economic activity active in a situation where they are losing between 10 and 25 percent of their workforce," Kannik said.
Editor: Mirjam Mäkivi, Helen Wright