Trump’s Israel aid cut reveals push to trade grants for tech cooperation

South China Morning Post · Tom Hussain · 2026-11-06 05:00 UTC

A shift towards joint technology development looks set to replace traditional grants with deeper, less scrutinised Pentagon funding.

The close defence relationship between the United States and Israel is set to be restructured over the coming two years, with billions of dollars in direct annual military aid being phased out in favour of joint weapons technology programmes.

US President Donald Trump shocked Israelis and Americans alike on Tuesday by suddenly announcing that the roughly US$4 billion a year in direct military funding Israel received from Washington would be cut off by the end of the year.

Speaking to Fox News on the morning of the US midterm elections, Trump claimed “they [Israel] don’t need it”, adding that he had “reached an agreement” with Israeli Prime Minister Benjamin Netanyahu.

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