10/10/2012 11:53–On the eve of the Jewish New Year, the Israeli economy can be described as satisfactory, with concerns about the future.
In a television interview on Israel’s Channel 2 last month, Stanley Fischer, the well-respected governor of the Bank of Israel, said that the state of the Israeli economy was good but not excellent. This more or less sums up the state of the local economy compared to the faltering economies of the EU and, to a certain extent, that of North America.
Finance Minister Yuval Steinitz and Prime Minister Binyamin Netanyahu have endeavored to create the impression that the state of the economy is excellent. But the need to create more sources of income, in the wake of an economy with a falling growth rate on the one hand and the need to increase social spending to create a more equitable society on the other, has shown that all is not well.
Furthermore, the recent upheavals in the region have had a negative impact on the State of Israel, and the need may arise to increase the military budget.
When assessing the state of the Israeli economy, many emotional factors come into play. Yet despite the fact that this may also affect sentiments and consequently have an impact on consumer demand, the stark figures are all-important. When analyzing the economy, the best indicators are the figures published regularly by the government’s Central Bureau of Statistics (CBS).
Up to now, the economy has managed to hold its own. GDP growth is falling and, according to the latest projections, it will probably amount to 2.7% to 2.8%. The latest OECD estimates put growth in 2012 at 2.9%, but local institutions are less certain. The first estimate of the CBS for the first half of 2012 has GDP rising by an annual 3.0%, but it is doubtful whether the final figures will be that optimistic and whether the growth figures for the second half of the year will be so encouraging…Read More>>