STATE OF ISRAEL MINISTRY OF FINANCE International Affairs
Department ECONOMIC HIGHLIGHTS July 2011, 2 nd Quarter 2011 Click
to start
Slide 2
Contents Economic Figures Balances International Comparisons
Israel and the OECD International Agreements Relevant Sites Note:
You can return to the beginning of each chapter by clicking the
emblem of Israel on the top of each slide. Contact Us
Slide 3
Economic Figures GDP and Business GDP Major GDP Components
Growth: Israel compared to the World Exports of Goods and Services
Foreign Investments Unemployment & Participation Rates
Inflation Rate Growth of Main GDP Components 2008 Main Economic
Indicators Main Trading Partners Inflation Rate Worldwide BACK TO
CONTENTS
Slide 4
*Current Prices, using a public exchange rate of 1$ = 3.46 NIS
** Estimated Main Economic Indicators 2011 Q1 2010 Q4 2010 Q3 2010
Q2 20102009Criteria 55.154.553.552.9213.1203.6 GDP (current prices
in $B)* 4.7%7.6%4.8%5.5%4.7%0.8% Real GDP Growth Rate (%) --
29,531$28,581$ GDP per Capita (PPP adjusted)*
2.7%5.4%2.8%3.7%2.8%-1.1% GDP per Capita Growth Rate (%, 2005
prices) 24.6 (44.6%) 23.7 (43.5%) 23.1 (43.1%) 23.0 (43.5%) 91.3
(42.9%) 80.4 (39.5%) Exports (Goods & Services) $B* (As
Percentage of GDP) 22.9 (41.5%) 21.1 (40.5%) 21.3 (39.7%) 21.3
(40.2%) 85.6 (40.1%) 76.0 (37.3%) Imports (Goods & Services)
$B* (As Percentage of GDP) 6.0%6.5% 6.6%7.6% Unemployment Rate (%)
Source: Ministry of Finance, IMF CONTINUE
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Source: Ministry of Finance 2010200920082007Criteria
76.4%79.3%77.1%77.8% Total Gross Debt (% of GDP) 42.7%43.0% 43.6%
Government Expenditure (Percentage of GDP) 2.9%3.6%0.8%2.9% Current
Account Surplus (% of GDP) 2.7%3.3%4.6%0.5% Inflation Rate (CPI,
yearly average) CONTINUE Main Economic Indicators
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Source: Ministry of Finance Overseas Bonds Forecast Domestic
Bonds TermRating Firm Rating A1 Stable A1Long Moody's P1-Short A
Stable AA-Long Standard & Poor's A-1A-1+Short A Stable A+Long
Fitch F1-Short Main Economic Indicators CONTINUE All 3 rating firms
have reaffirmed Israels rating, without any downgrade, Since the
global economic crisis in 2009.
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GDP and Business GDP Annual rate of change, constant prices In
2010, Israel has recovered from the globalIn the 4 th quarter of
2010, Israel economic crisis, and is back to previous years
experienced exceptional growth rates growth rates Source: Ministry
of Finance. CONTINUE
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GDP Growth Israel compared to advanced economies* (annual rate
of change, constant prices) Source: Ministry of Finance, IMF Since
2004, Israels growth rate has exceeded the average growth rate of
advanced economies. CONTINUE In 2009, as most of the world
experienced a decline in GDP, Israel experienced a 0.8% growth in
its GDP
Slide 9
Major GDP Components Annual rate of change, in constant prices
Source: Ministry of Finance CONTINUE In 2010, Investment in Fixed
Assets and Export of Goods and Services recovered sharply, after
they were contracted severely in 2009 due to the economic crisis.
Global Economic Crisis
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Source: Ministry of Finance Exports of Goods and Services US $
Billions, current prices CONTINUE Global Economic Crisis
Slide 11
Israels Main Trading Partners 2010, US $ Billions Source:
Central Bureau of Statistics Exports CONTINUE * Since July 1997 the
data on trade with Hong-Kong is added to the data on China
Imports
Slide 12
Israels Main Trading Partners US $ Billions Source: Central
Bureau of Statistics CONTINUE Imports Exports Europe Asia North
America
Slide 13
Net Foreign Investments in Israel US $ Billion * 2006 is
exceptional due to a large acquisition by Teva Pharmaceutical
Industries Ltd Source: Ministry of Finance CONTINUE Global Economic
Crisis
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Unemployment and Participation As % of total labor force
Source: Ministry of Finance CONTINUE Since the 2 nd quarter of 2009
unemployment is decreasing, hand in hand with an increase in
participation rate since the 1 st quarter of 2010.
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Inflation Rate Rate of change in CPI, yearly average, 2008=100
Source: Central Bureau of Statistics, Ministry of Finance
CONTINUE
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Inflation Rate Rate of change in CPI, 12 months average,
2008=100 Source: Central Bureau of Statistics, Ministry of Finance
CONTINUE
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Inflation Rate Worldwide Annual rate of change in CPI Sources:
Ministry of Finance, IMF CONTINUE The Israeli economy demonstrated
a high level of stability compared to other countries throughout
the global economic crisis
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Q1 2011Criteria + 4.7%Real GDP + 5.8%Business GDP +
16.0%Exports + 6.8%Private Consumption + -5.7%Public Consumption +
23.7 %Investment in Fixed Assets Source: Ministry of Finance Growth
of Main GDP Components for Previous Quarter NEXT CHAPTER:
BALANCESBACK TO CONTENTS
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Balances Budget Deficit Target and Execution Gross Public Debt
BACK TO CONTENTS Budget Deficit and General Government Expenditure
Gross Tax Burden Current Account and Net Foreign Debt
Slide 20
Gross Public Debt As % of GDP Source: Ministry of Finance Since
2003, gross public debt has been on a consistent downward trend,
only interrupted by the extraordinary circumstances surrounding the
2009 global economic crisis CONTINUE Global Economic Crisis
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Budget Deficit Target and Execution in NIS million, current
prices Source: Ministry of Finance CONTINUE For the first time in
its history, Israel enacted a biennial budget for the years
2009-2010 In both years, Israel came in under budget target.
Quarterly Budget Execution Yearly Budget Execution Yearly Budget
Target
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Source: Ministry of Finance Budget Deficit and General
Government Expenditure General Government Expenditure (% of GDP)
CONTINUE Budget Deficit (% of GDP)
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Current Account Balance and Net Foreign Debt Source: Ministry
of Finance. Since 2003, the current account balance is positive,
and is accompanied by a decrease of net foreign debt Current
Account Surplus (% of GDP) Net Foreign Surplus* (% of GDP) CONTINUE
*Current Prices, using a public exchange rate of 1$ = 3.46 NIS
Slide 24
Source: Ministry of Finance, OECD Gross Tax Burden as % of GDP
OECD countries average: 34.8% (2008 average) NEXT CHAPTER:
INTERNATIONAL COMPARISONSBACK TO CONTENTS
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International Comparisons NASDAQ and Tel-Aviv 100 (monthly
average) WEF Global Competitive Index Central Bank Interest Rates:
Israel and U.S.A BACK TO CONTENTS IMD World Competitiveness
Yearbook
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Source: International Institute for Management and Development
(IMD), World Competitiveness Yearbook 2011 IMD World
Competitiveness Yearbook 2011 The Institute for Management
Development ranked Israel 17 th out of 59 countries for 2011
(Israel was also ranked 17 th in 2010) CONTINUE
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Source: International Institute for Management and Development
(IMD), World Competitiveness Yearbook 2011 IMD World
Competitiveness Yearbook 2011 CONTINUE Information Technology
SkillsCentral Bank policy EntrepreneurshipFlexible and
adaptability
Slide 28
Source: International Institute for Management and Development
(IMD), World Competitiveness Yearbook 2011 IMD World
Competitiveness Yearbook 2011 CONTINUE Total expenditure on R&D
(as % of GDP)Scientific Research Innovative capacityVenture
Capital
Slide 29
Source: World Economic Forum, Global Competitiveness Index,
2010-2011 The World Economic Forum ranked Israel 24 th out of 139
countries for 2010-2011 CONTINUE WEF Global Competitiveness Index
2010-2011
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Source: World Economic Forum, Global Competitiveness Index,
2010-2011 CONTINUE Quality of scientific research
institutionsUtility patents per million population Availability of
latest technologiesStrength of investor protection WEF Global
Competitiveness Index 2010-2011
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Source: World Economic Forum, Global Competitiveness Index,
2010-2011 Legal rights indexCapacity for innovation Firm-level
technology absorptionNature of competitive advantage CONTINUE WEF
Global Competitiveness Index 2009-2010
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Central Bank Interest Rates: Israel and U.S.A Source: Bank of
Israel (BOI), Federal Reserve Bank of Israel Rate (BOI) U.S.
Federal Funds Rate (FED) = 0% CONTINUE The Bank of Israel was the
first in the western world to raise interest since the outburst of
the economic crisis. The rate was raised gradually from 0.5% to
3.25%
Slide 33
NASDAQ & Tel Aviv 100 monthly average Source: Ministry of
Finance Tel Aviv 100 corresponds with the NASDAQ to current events
NEXT CHAPTER: ISRAEL AND THE OECDBACK TO CONTENTS
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Israel and the OECD Unemployment GDP per Capita Real GDP Growth
Expenditure on R&D Israel was invited as a full member in the
OECD on May 10 th, 2010, and officially joined in September 10 th,
2010. BACK TO CONTENTS
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Source: OECD CONTINUE Israel is ranked 1 st of all OECD
countries by expenditure on R&D (research & development) as
a percentage of GDP (4.27 %), demonstrating innovation, development
and creativity. Expenditure on R&D As % of GDP, 2008, or latest
available year
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Real GDP Growth 3-year average at end of period Source: OECD
CONTINUE Israels 3-year average growth rate is higher then most
OECD members. For Israels year-on-year graph, see slide no.7
Slide 37
GDP per capita Current prices and PPPs, 2009 Source: OECD
CONTINUE For Israels adjusted PPP GDP Per Capita, see slide no.4
Although no comparable data for 2010 exists, it is reasonable to
assume a diminishing gap between Israel and the OECD average
Slide 38
Source: Ministry of Finance, OECD Israels unemployment rate is
in an ongoing downtrend, reaching an historic low level of 5.8% in
April 2011. During the last global economic crisis, Israel
experienced a relatively mild increase in unemployment rates. For
Israels unemployment, see NEXT CHAPTER: INTERNATIONAL
AGREEMENTSBACK TO CONTENTS Unemployment Rate Average 2006-2008, or
latest available period slide no.14
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International Agreements Avoidance of Double Taxation
Agreements Bilateral Investment Treaties Cooperation in Industrial
R&D Agreements International Organization Memberships Israels
Free Trade Agreements BACK TO CONTENTS
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QIZ Agreements Egypt(2004) Jordan(1998) Israels Free Trade
Agreements 1985 1992 1997 1999 2000 2007 USA EFTA Turkey Canada
Mexico European Union (Association Agreement) MERCOSUR (Argentina
not yet in force) CONTINUE Source: Ministry of Finance
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Avoidance of Double Taxation Agreements Austria Belarus Belgium
Brazil Bulgaria Canada China Czech Republic Croatia Denmark Estonia
Ethiopia Finland France Germany Greece Hungary India Ireland Italy
Jamaica Japan Latvia Lithuania CONTINUE Source: Ministry of
Finance
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Avoidance of Double Taxation Agreements CONTINUE Source:
Ministry of Finance Luxembourg Mexico Moldova Norway Philippines
Portugal Poland Romania Russia Singapore Slovakia Slovenia South
Africa South Korea Spain Sweden Switzerland Thailand Netherlands
Turkey Ukraine United kingdom Uzbekistan U.S.A Taiwan Vietnam
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Cooperation in Industrial R&D Agreements CONTINUE Source:
Ministry of Finance Austria Belgium Canada China Finland France
Germany Hong Kong Sweden United kingdom U.S.A India Ireland Italy
Korea Netherlands Portugal Singapore Spain Victoria (Australia)
Czech Republic
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Bilateral Investment Treaties CONTINUE Source: Ministry of
Finance Albania Argentina Armenia Azerbaijan Belarus Bulgaria China
Croatia* India Kazakhstan Latvia Lithuania Germany Cyprus Czech
Republic El Salvador Estonia Georgia Guatemala Ethiopia Hungary*
Macedonia* Korea Moldova * See comments in the Bilateral
Investments Treaties page in our websiteBilateral Investments
Treaties
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Bilateral Investment Treaties CONTINUE Source: Ministry of
Finance South Africa* Thailand Turkey Turkmenistan Ukraine*
Uzbekistan Slovakia Slovenia* Serbia Mongolia Poland Romania*
Montenegro Peru* Vietnam* * See comments in the Bilateral
Investments Treaties page in our websiteBilateral Investments
Treaties
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Main International Economic Organizations Membership: Israel is
a member in leading international economic organizations: United
Nations Organizations United Nations Agencies World Bank Group
International Monetary Fund OECD Regional Organizations
Inter-Governmental Organizations NEXT CHAPTER: RELEVANT SITESBACK
TO CONTENTS Source: Ministry of Finance
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Relevant Sites BACK TO CONTENTS Ministry of Finance Bank of
Israel Central Bureau of Statistics Israeli Government Portal
Israel Securities Authority Ministry of Industry, Trade and Labor
CONTACT US Ministry of Foreign Affairs
Slide 48
WE WELCOME YOUR FEEDBACK Mr. Roni Hershkovitz Director Overseas
Economic Information International Affairs Department Ministry of
Finance Jerusalem Israel Mr. Assaf Luxembourg Overseas Economic
Information International Affairs Department Ministry of Finance
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