Netanyahu Clarifies US Military Aid to Israel Will Be Phased Out Gradually

Prime Minister Benjamin Netanyahu's office clarified on Wednesday that US military aid to Israel will be phased out gradually rather than ending at the close of the current year, as President Donald Trump's announcement ten days earlier had appeared to suggest.

In an official statement, the Prime Minister's Office emphasized Netanyahu's longstanding commitment to reducing Israel's dependence on American financial assistance. "In 1996, Prime Minister Netanyahu said that Israel would gradually end US economic aid, which stood at $1.2 billion. He kept his word. Thirty years later, Prime Minister Netanyahu said that Israel's economy is strong enough to gradually phase out US military aid as well. Today, Israel has a strong and stable economy, and Israel and the United States are taking a significant step in transitioning from aid to partnership."

The statement recalled Netanyahu's 1996 commitment to eliminate US economic assistance, a goal his office said he ultimately achieved. In an interview with CBS last May, Netanyahu reiterated his position, declaring, "I want to gradually reduce American financial aid to zero." US Secretary of State Marco Rubio confirmed in Paris this week that the proposed change was "a step the Israelis themselves suggested to us."

Trump Announcement Caught Israeli Defense Officials by Surprise

Trump's announcement reportedly caught Israel's Finance Ministry, the IDF, and the Defense Ministry off guard, as none had been informed of the decision in advance. Speaking to Fox News, the president said Israel was comfortable with the move, adding, "They're fine with it. They don't need us."

Representatives of Israel's Defense Ministry and the Israeli Embassy in Washington are now negotiating with Rubio's team to formulate a new agreement by the end of the year, ahead of the swearing-in of the new Congress in January.

Missile Defense Cooperation Expected to Expand

Under the existing arrangement, annual US military assistance to Israel totals $3.8 billion, including $3.3 billion designated for the purchase of American military equipment such as aircraft, helicopters, and ammunition. Previous agreements also allowed Israel to convert a portion of the assistance into shekels for purchases from domestic defense manufacturers.

An additional $500 million is allocated annually to the joint research, development, and production of missile defense systems, including Iron Dome, David's Sling, and Arrow.

According to the ongoing negotiations, funding for these joint defense programs is expected to increase rather than decrease, reflecting the growing threats posed by missiles and drones and the need for continued security cooperation between the two countries. The size of the proposed increase has not yet been determined.

The emerging arrangement would mark a significant shift in US-Israel relations, gradually replacing traditional military assistance with a partnership focused on joint defense development and strategic cooperation.