Israel has launched a new Munitions Directorate, tasked with reducing dependence on foreign suppliers and expanding domestic production.

By Hezy Laing

Prime Minister Benjamin Netanyahu has announced a strategic pivot toward defense self-sufficiency, as Israel faces mounting pressure from European nations imposing arms embargoes amid the war with Hamas.

Speaking at a Finance Ministry conference in Jerusalem, Netanyahu said that Israel must prepare to produce its own military hardware to maintain operational readiness.

“We will increasingly need to adapt to an economy with autarkic characteristics,” Netanyahu said, referencing the concept of economic self-reliance.

“It’s a word I hate. I am a believer in the free market, but we may find ourselves in a situation where our arms industries are blocked.
We will need to develop arms industries here—not only research and development, but also the ability to produce what we need”.

This shift comes as countries like Spain, Germany and Italy move to restrict or halt arms exports to Israel.

Spain is preparing a total “weapons embargo”, including bans on transit and trade with Israeli defense firms, and may even declare Netanyahu and other ministers personae non grata.

It is unclear if Israel actually buys any weapons from Spain.

Germany, which supplied nearly 30% of Israel’s arms imports between 2019 and 2023, has already suspended exports that could be used in Gaza.

In response, Israel has launched a new Munitions Directorate, tasked with reducing dependence on foreign suppliers and expanding domestic production of munitions, spare parts, and battlefield technologies.

Former national security adviser Yaakov Amidror emphasized that while Israel may never produce its own fighter jets or submarines, it can become far more independent in critical areas like ammunition and electronic warfare systems.

Netanyahu’s remarks reflect a broader recalibration of Israel’s defense strategy, driven by geopolitical shifts, demographic changes in Europe, and the growing influence of anti-Israel narratives on digital platforms.

As embargoes tighten and diplomatic ties fray, Israel is positioning itself to weather isolation by becoming a Spartan-style defense economy—lean, resilient, and self-reliant.

In the end, Israel may actually benefit from the embargoes – by forcing it to create profitable news industries it was reluctant to create in the past.