Transcript Slide 1

STATE OF ISRAEL
MINISTRY OF FINANCE
INTERNATIONAL AFFAIRS DEPARTMENT
ECONOMIC HIGHLIGHTS
May 6th, 2007
Contents:
Economic Figures……. 3
Balances……………...18
International
comparisons and
additional data………. 24
Economic
Figures
Economic Figures
Israel’s Economy:
Main Characteristics
Export Oriented Growth
Rapid Development of Technology &
High-Tech Industries
Entrepreneurial Culture
Supportive Environment for Business
Investment & R&D Incentives
4
Economic Figures
Main Economic Indicators and forecast
2003
2004
2005
2006
2007F
GDP (current prices in B$)
115.4
128.9
129.7
140.5
148.5*
GDP Real Growth rate (%)
1.3%
4.3%
5.2%
5.1%
5.0%
GDP per Capita (current prices,
000’$)
17.2
18
18.7
19.9
21.8
GDP per Capita Growth rate (%)
-0.5%
3.0%
3.2%
3.2%
3.2%
Exports of Goods & Services (B$)
43.5
52.8
57.9
62.6
Imports of Goods & Services (B$)
44.4
52.3
57.5
61.7
Unemployment Rate (%)
10.7%
10.4%
9.0%
8.4%
7.4%
Inflation Rate ( CPI, end of year)
-1.9%
1.2%
2.4%
-0.1%
1.0%
Current Account (% of GDP)
0.5%
0.4%
3.3%
4.9%
Criteria
Source: Central Bureau of Statistics, Bank of Israel, Ministry of Finance
* Using the NIS estimate by the Ministry of Finance, Multiplied by Bank of Israel’s average US$-NIS rate for 2007.
5
Economic Figures
GDP and GDP per Capita
(Annual % Change, in Constant Prices)
9.0
8.0
7.0
5.0
5.2
4.8
4.6
3.0
3.0
5.0
5.1
3.4
3.2
3.2
1.5
1.0
-1.0
-0.9
-3.0
-0.3
-0.9
-2.9
-2.9
-5.0
2000
2001
2002
GDP
Source: Central Bureau of Statistics, Ministry of Finance
2003
2004
2005
2006
2007F
GDP per Capita
6
Economic Figures
Major GDP Components
(Annual % Change, in Constant Prices)
20
18.2
15
10
9.5
8.2
5.1
5.5
5.0
3.4
5
0.8
0.9
2.9
2.7
4.8 6.4
4.9
3.3
4.9
2.9
5.1
0.3
0
-2.3
-5
-6.0
-2.3
-2.3
-5.5
-10
2002
2003
2004
Private Consumption
Investment in Fixed Assets
Source: Central Bureau of Statistics, Bank of Israel, Ministry of Finance
2005
2006
2007F
Government Consumption
Exports of Goods and Services
7
Economic Figures
GDP Growth and Exports Growth
(Cumulative Rate of Growth by Period)
188%
200%
150%
120%
115%
100%
100%
82%
62%
54%
50%
54%
34%
35%
0%
1960-1969
1970-1979
GDP Growth
1980-1989
1990-1999
1997-2006
Exports Growth
Source: Central Bureau of Statistics, Bank of Israel, Ministry of Finance
8
Economic Figures
Exports of Goods and Services (B$)
70
60
19.2
17.8
50
16.1
40
13.3
11.8
30
20
40.1
36.6
30.2
27.5
43.3
10
0
2002
2003
2004
Goods
Source: Central Bureau of Statistics
2005
2006
Services
9
Economic Figures
Exports of Goods by Region 2006
(exc. Diamonds)
Africa
3%
Other
11%
European
Union
31%
Asia
15%
USA
34%
Source: Central Bureau of Statistics, Bank of Israel, Ministry of Finance
Rest of
Europe
6%
10
Economic Figures
Structure of Industrial Exports
traditional industries
hi-tech industries
30,000
25,000
6,694
US$ millions
6,321
20,000
4,836
23%
15,000
10,000
5,000
4,730
24%
4,731
26%
5,188
15,962
77%
7,895
7,761
25%
25%
21,901
23,041
75%
75%
2006
2007*
26%
27%
27%
4,277
35%
7,216
17,308
14,862
13,525
14,166
76%
74%
73%
2001
2002
18,794
73%
74%
2004
2005
65%
0
1995
2000
*Jan-Mar s.a. at annual rate.
2003
11
Economic Figures
Imports of Goods by Region 2006
(exc. Diamonds)
Rest of the
World
14%
Africa
1%
European
Union
39.5%
Asia
19%
USA
13%
Source: Central Bureau of Statistics, Bank of Israel, Ministry of Finance
Rest of
Europe
10.5%
12
Economic Figures
Foreign Investments (B$)
24.4
Direct Investments
25
Total Investments
20
14.2
15
12.3
9.6
10
5.2
4.5
5
9.9
9.1
5.4
3.7 4.1
3.1
3.2 3.9
1.7
1.7
4.8
2.1
0
1998
Source: Ministry of Finance
1999
2000
2001
2002
2003
2004
2005
2006
13
Economic Figures
Unemployment Rate by Quarters*
(% of Total Labor Force)
9.3%
9.2%
9.1%
9.0%
8.9%
8.9%
8.9%
8.8%
8.8%
8.7%
8.5%
8.3%
8.3%
8.1%
7.9%
7.7%
7.7%
7.5%
2005 Q1
Source: CBS
Q2
Q3
Q4
2006 Q1
Q2
Q3
Q4
14
Economic Figures
New Employed Persons in 2006
(Change in Israeli Employed Persons, in Thousands)
74
96
50
48
42
30
25
16
13
6
-3
-11
2001
2002
2003
Business Sector
Source: Ministry of Finance
2004
2005
2006
Public Sector
15
Economic Figures
Inflation Rate (% Change in CPI, end of year)
6.5%
7.00%
6.00%
5.00%
4.00%
2.4%
3.00%
2.00%
1.3%
1.00%
1.4%
1.2%
1.0%
-1.9%
0.0%
-0.1%
0.00%
-1.00%
-2.00%
1999
Source: CBS, Ministry of Finance
2000
2001
2002
2003
2004
2005
2006
2007F
16
Economic Figures
Estimated Growth of Main GDP
Components 2007
Criteria
Estimate for 2007
Real GDP Growth
5.0%
Business GDP Growth
5.6%
Exports Growth
5.1%
Private Consumption Growth
4.9%
Government Consumption
Growth
2.9%
Investment in Fixed Assets
Growth
9.5%
Source: Ministry of Finance
17
Balances
Back to contents
Balances
Budget Deficit
6%
5.4%
5%
4%
(% of GDP)
4.2%
3.7%
3.6%
3.2%
2.9%
3%
1.9%
2%
0.9%
0.7%
1%
0%
1999
2000
2001
2002
2003
2004
2005
2006
2007
Budget
proposal
Source: Ministry of Finance, April 2007
19
Balances
Current Account
(% of GDP)
4.9%
6.0%
3.3%
5.0%
2.3%
4.0%
1.2%
3.0%
2.0%
-1.3%
-0.6%
1.0%
0.0%
-1.0%
-2.0%
Source: Bank of Israel
2001
2002
2003
2004
2005
2006
20
Balances
Net Foreign Debt
(% of GDP)
2.8%
0.1%
5%
0%
-2.3%
-5%
-5.7%
-10%
-8.6%
-15%
-16.3%
-20%
-22.6%
-25%
2000
Source: Ministry of Finance
2001
2002
2003
2004
2005
2006
21
Balances
General Government Expenditure
(% of GDP)
54%
53%
52.2%
52.1%
51.5%
51.4%
52%
51.1%
50.7%
51%
50.0%
50%
49.2%
48.4%
49%
48%
47.4%
46.8%
47%
46%
45%
1996
Source: Ministry of Finance
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
22
Balances
Gross Tax Burden
(% of GDP)
39.00%
38.1%
38.00%
38.2%
37.80%
37.5%
37.2%
37.00%
36.80%
37.00%
36.6%
36.7%
36.8%
36.00%
1997
Source: Ministry of Finance
1998
1999
2000
2001
2002
2003
2004
2005
2006
23
International
comparisons
and additional
data
Back to contents
Additional data
Central Bank Interest Rates Israel vs. U.S.A (%)
Currently:
6
5
5.25%
Bank of Israel Rate
4
Currently:
3
3.75%
2
1
5
4
3
2
2007
12
11
10
9
8
7
6
5
4
3
2
2006
12
11
10
9
8
7
6
5
4
3
2
2005
12
11
10
9
8
7
6
5
4
3
2
2004
0
Federal Reserve Rate
Source: Bank of Israel, Federal Reserve
25
Additional data
Nasdaq Index & Tel Aviv 100 (monthly average)
4000
1000
Nasdaq Index (left scale)
3500
900
Tel Aviv 100 (right scale)
800
3000
2500
2000
700
600
500
400
1500
1000
Jan 2003 Jul 2003 Jan 2004 Jul 2004 Jan 2005 Jul 2005 Jan 2006 Jul 2006 Jan 2007
300
200
26
Additional data
Israel’s Credit Rating 1992-2007
A1/A+
6
A2/A
5
A3/A-
4
Baa1/BBB+ 3
Baa2/BBB
2
Moody's A2 Stable
S&P A- Stable
Fitch A- Stable
Baa3 /BBB- 1
0
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Source: Credit Rating Agencies, Accountant General
27
Additional data
Global Competitiveness Index, 2006
Israel Ranks 15 Out of 125 Countries (2005 Rank was 23)
4
1
6
8
10
15
18
24
21
28
42
34
47
48
58
59
d
n
la
er
it z
w k
S
ar
m
en
D
A
S
y
U
an
m
er
G
K
U
el
ra
Is
ce
an
Fr
d
an
el
Ir
ea
or
K
in
pa l
S
ga
tu
or
P
ly
Ita e
ec
re
G
d
an
ol
P o
ic
ex
M
ey
rk
Tu
Source: World Economic Forum, GCI 2006
28
Additional data
Business Competitiveness Index, 2006
Israel Ranks 19 Out of 121 Countries (2005 Rank was 22)
1
2
5
8
12
16
19
22
25
27
36
30
46
49
55
64
U
.A
.S
m
er
k
ar
y
an
m
en
G
D
K
U
ia
tr
us
A
ce
an
Fr
ea
or
el
ra
Is
nd
la
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K
na
hi
a
di
In
n
ai
Sp
ia
en
ov
Sl
ey
rk
Tu
e
ec
re
G
l
zi
ra
B
C
Source: World Economic Forum, GCI 2006
29
Additional data
Network Readyness score, 2006
5.71 (1)
Denmark
5.58 (5)
Switzerland
5.54 (7)
United States
5.45 (9)
United Kingdom
5.35 (11)
Canada
5.27 (14)
Japan
5.22 (16)
Germany
5.14 (18)
Israel
4.99 (23)
4.48 (28)
France
Portugal
4.35 (32)
Spain
4.19 (38)
Italy
Greece
Turkey
Source: World Economic Forum, GCI 2006
3.98 (48)
3.86 (52)
30
Additional data
Israel’s Free Trade Agreements
USA (1985)
EFTA (1992)
Turkey (1997)
Mexico (1999)
Jordan (1995): Bilateral Trade Agreement
Canada (1997)
European Union – Association Agreement 2000
Romania (2000)
Bulgaria (2002)
31
Additional data
Avoidance of Double Taxation
Agreements
Belarus
Hungary
Slovakia
Belgium
India
South Africa
Brazil
Jamaica
South Korea
Bulgaria
Japan
Spain
Canada
Luxembourg
Sweden
China
Mexico
Thailand
Czech republic
Norway
The Netherlands
Denmark
Philippines
Turkey
Finland
Poland
USA
France
Romania
Also:
Austria, Ireland, Italy, Latvia,
Germany
Russia
Greece
Singapore
Lithuania, Switzerland,
Ukraine, United Kingdom, and
Uzbekistan.
32
Additional data
Cooperation in Industrial R&D
Agreements
Austria
India
Sweden
Belgium
Ireland
UK
Canada
Italy
USA
China
Korea
Finland
Netherlands
France
Portugal
Germany
Singapore
Hong Kong
Spain
33
Additional data
Protection of Investment Agreements
Albania
El-Salvador
Argentina
Estonia
Armenia
Georgia
Belarus
Germany
Bulgaria
Hungary
Croatia
India
Cyprus
Czech Republic
Kazakhstan
Korea
34
Additional data
Protection of Investment Agreements (con)
Latvia
Turkmenistan
Lithuania
Ukraine
Moldova
Uruguay
Poland
Uzbekistan
Romania
Slovakia
QIZ Agreement
Slovenia
Egypt
Thailand
Jordan
Turkey
35
Additional data
International Organization* Memberships:
BIS | BSEC (observer) | CE (observer)
CERN (observer) | EBRD | FAO | IADB | IAEA
IBRD | ICAO | ICC | ICCt (signatory) | ICFTU
IDA | IFAD | IFC | IFRCS (observer) | ILO | IMF
IMO | Interpol | IOC | IOM | ISO | ITU | OAS (observer)
OPCW (signatory) | OSCE (partner) | PCA | UN
UNCTAD | UNECE | UNEP | UNESCO | UNHCR
UNIDO | UPU | WB | WCO | WFP | WHO | WIPO | WMO
WToO | WTrO | WTO | MIGA
* Economic Organizations
36
Relevant Sites
Government Institutes:
Bank of Israel
Central Bureau of Statistics
Israeli Government Portal
Ministry of Finance
Israel Securities Authority
Economic News:
“The Marker”
“Globes”
32
We welcome your feedback:
Contact:
Uri Geva
International Affairs Department
Ministry of Finance, Jerusalem, Israel
[email protected]