Transcript Israel Ministry of Finance - Economic Highlights Presentation

STATE OF ISRAEL
MINISTRY OF FINANCE
International Affairs Department
Economic Highlights Presentation
4th Quarter 2011
In any case of information derived from sources external to the Ministry of
Finance, such sources are mentioned at the bottom of each item
Table of Contents
1
Main Economic Indicators
2
Balances
3
International Comparisons
4
Israel in the OECD
5
International Agreements
6
Learn More
7
Contact
2
Main Economic Indicators
Economic Figures
GDP and Business GDP
Major GDP Components
Exports of Goods and Services
Main Trading Partners
Gross Domestic Capital Formation
Foreign Investments
Unemployment and Participation
Consumer Price Index
Inflation Rate
Israel’s Credit Ratings
3
Economic Figures
Criteria
2009
2010
2010 Q4
2011 Q1
2011 Q2
2011 Q3
GDP
(constant prices, 2005, in $B)*
189.9
199.0
50.9
51.5
51.9
52.4
Real GDP growth rate
(% change)
0.8%
4.8%
7.2%
4.7%
3.5%
3.4%
$28,526
$29,901
--
--
--
--
-0.9%
2.9%
8.6%
5.2%
2.6%
5.3%
GDP per capita, based on PPP
(Current international $)
GDP per capita growth rate
(%, 2005 prices)
Exports (goods & services), $B*
(As % of GDP)
Imports (goods & services), $B*
75.1
85.3
22.1
22.5
22.6
21.5
39.5%
42.9%
43.4%
43.7%
43.5%
41.0%
71.0
80.0
20.7
21.9
22.4
22.0
(As % of GDP)
37.4%
40.2%
40.7%
42.5%
43.2%
42.0%
Unemployment rate
7.6%
6.6%
6.5%
6.0%
5.5%
5.6%
* Using a public exchange rate of 1USD=3.7NIS (2010 average)
** Estimated
Additional Sources: IMF
4
Economic Figures
Criteria
2005
2006
2007
2008
2009
2010
Public debt
(As % of GDP)
93.8%
84.3%
77.8%
77.1%
79.3%
76.3%
General government expenditure
(As % of GDP)
45.3%
44.7%
43.6%
43.0%
43.0%
42.6%
Current account surplus
(As % of GDP)
3.1%
5.1%
2.9%
0.9%
3.6%
2.9%
Inflation rate
(CPI, yearly average, % change)
1.4%
2.1%
0.5%
4.6%
3.3%
2.7%
Budget deficit
(As % of GDP)
1.8%
0.9%
0.0%
2.2%
5.2%
3.7%
5
GDP and Business GDP
Annual rate of change, constant prices, 2005
11%
In 2010, Israel has recovered from the global economic crisis, and is back to previous years’ growth rates. In the 3rd
quarter of 2011, business GDP recovered sharply.
8.6%
9%
6.8%
7%
6.1%
4.8%
5%
3%
4.9%
7.2%
6.8%
5.6%
6.1%
5.5%
5.8%
4.5%
4.0%
4.8%
5.3%
5.2%
4.7%
3.5%
3.4%
2.6%
2.3%
1.5%
0.8%
0.4%
1%
-1%
-3%
-0.3% -0.6%
-1.2% -1.0%
GDP
Business GDP
6
Major GDP Components
Annual rate of change, constant prices, 2005
20%
15%
Global economic crisis
14.5%
9.2%
10%
5%
13.7%
13.6%
13.1%
4.2%
3.0%
5.5%
6.6%
6.3%
3.3%
4.4%
2.8%
2.1%
2.2%
1.4%
2.2%
1.4%
0%
-5%
Private Consumption
-5.8%
Public Consumption
-10%
Investment in Fixed Assets
Exports of Goods and Services
-12.5%
-15%
7
Exports of Goods and Services
US $ Billions, constant prices, 2005
90
Global economic crisis
80
70
24.09
21.13
60
21.98
19.27
50
16.03
40
24.23
17.45
13.39
30
20
30.19
36.66
39.77
43.32
50.29
57.71
56.09
46.33
10
0
Services
Goods
* Using a public exchange rate of 1USD=3.7NIS (2010 average)
8
Main Trading Partners
US $ Billions, 2010
8
7
20
18.5
Exports
18
6
3.7
3
12
2
10
1
4
6.1
4
14
6
Imports
5
16
8
6.7
3.2
2.4
2.2
2.1
1.8
1.8
1.8
0
6.0
3.1
2.9
2.3
2
1.8
1.7
1.3
1.3
1.3
0
* Since July 1997 the data on trade with Hong-Kong is added to the data on China
Additional Sources: Central Bureau of Statistics
9
Main Trading Partners
US $ Billions, 2010
35.0
Imports
30.0
29.7
26.8
25.0
26.5
22.9
20.0
15.0
11.7
10.0
8.3
13.2
13.0
9.8
8.7
6.3
5.0
7.3
0.0
2007
2008
2009
2010
35.0
30.0
25.0
20.0
15.0
10.0
Europe
Asia
North America
Additional Sources: Central Bureau of Statistics
Exports
19.9
19.2
9.6
21.9
21.2
12.0
17.6
15.4
19.6
18.9
12.9
9.3
5.0
0.0
2007
2008
2009
2010
10
Gross Domestic Capital Formation
As % of GDP
21%
20.3%
20%
19.6%
19.3%
19.2%
18.9%
19%
18%
18.0%
17.9%
18.1%
17.6%
17%
16%
11
Foreign Investments
US $ Billions
25
19.4
20
17.6
15.3
15
14.4
10.8 10.9
9.5
10
5
8.8
8.3
4.9
4.3
3.3
1.6
10.7
4.3
4.4
5.2
2.4
0
Total Investments
Direct Investments
* 2006 is exceptional due to a large acquisition by Teva Pharmaceutical Industries Ltd.
12
Unemployment and Participation
As % of total labor force
9%
Since the 2nd quarter of 2009 unemployment is relatively
increase in participation rate since the 1st quarter of 2010.
8%
57.7%
7.9%
7%
56.8%
7.5%
57.0%
56.8%
57.49%
57.4%
57.2%
7.2%
56.8%
59%
58%
57.7%
57.5%
7.6%
56.8%
decreasing, hand in hand with a relative
57%
56.7%
6.9%
6.5%
6.4%
6.6%
6.5%
6%
56%
6.0%
5.5%
5.6%
5%
55%
Unemployment Rate
Participation in the Labor Force
4%
Q4
2009 Q1
Q2
Q3
54%
Q4
2010 Q1
Q2
Q3
Q4
2011 Q1
Q2
Q3
13
Consumer Price Index
Last 24 monthly averages, 2010=100
105
104.2
104.0104.1104.0
104.0
103.7
103.6
103.1
104
103
102.5
102.3
102.0
101.8
101.3101.4
101.0
100.8
100.3
102
101
100
99
99.2
99.1 99.1
98.5
98
99.5
99.8
98.2 98.3
97
96
95
Additional Sources: Central Bureau of Statistics
14
Inflation Rate
Rate of change in consumer price index, yearly average
5%
4.6%
4%
3.3%
3%
2.7%
2.1%
2%
1.4%
1%
0.7%
0.5%
0%
-0.4%
-1%
15
Israel’s Credit Ratings
Rating Firm
Moody's
Standard & Poor's
Fitch
Term
Domestic Bonds
Rating
Long
A1
Short
-
Long
AA-
Short
A-1+
Long
A+
Short
-
Forecast
Stable
Stable
Stable
Overseas Bonds
Rating
A1
P1
A+
A-1
A
F1
16
Table of Contents
1
Main Economic Indicators
2
Balances
3
International Comparisons
4
Israel in the OECD
5
International Agreements
6
Learn More
7
Contact
17
International Comparisons
Gross Public Debt
Budget Deficit
General Government Expenditure
Current Account Surplus
Net Foreign Surplus
Gross Tax Burden
18
Gross Public Debt
As % of GDP
105%
100%
Since 2003, gross public debt has been on a consistent downward trend, only interrupted by the extraordinary
circumstances surrounding the 2009 global economic crisis.
99.1%
97.4%
95%
93.8%
90%
85%
80%
Global economic crisis
84.3%
79.3%
77.8%
77.1%
76.3%
75%
70%
19
Budget Deficit
As % of GDP
6%
5.2%
5.2%
5%
4%
3.7%
3.5%
3%
2.2%
2%
1%
0%
1.8%
0.9%
0.0%
20
Budget Deficit
Target and execution in NIS million, current prices
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. The proven effectiveness and functionality of the biennial budget have led the government to adopt
the biennial budget for a second period through 2011-2012.
0
-3,626
-6,371
-6,721
-10,000
-20,000
-3,657
-16,061
-16,161
-30,000
-40,000
-50,000
-4,862
-30,165
-39,286
-44,355
Quarterly Budget Execution
-42,924
Yealy Budget Execution
Yearly Budget Target
21
General Government Expenditure
As % of GDP
51%
50%
50.1%
49%
48%
47.3%
47%
46%
45%
44%
43%
45.3%
44.7%
43.6%
43.0%
43.0%
42.6%
42%
41%
40%
39%
38%
22
Current Account Surplus
As % of GDP
6%
5.1%
5%
4%
3.6%
3.1%
3%
2.9%
2.9%
2.3%
2%
1.2%
1%
0.9%
0%
23
Net Foreign Surplus
As % of GDP
30%
26.3%
26.6%
25%
22.5%
22.6%
20%
14.7%
15%
10.9%
10%
4.5%
5%
1.7%
0%
* Using a public exchange rate of 1USD=3.7NIS (2010 average)
24
Gross Tax Burden
As % of GDP
37%
36.2%
36%
35.9%
35.5%
35.5%
35.6%
35%
OECD countries average: 34.8%
(2008 average)
34%
33.8%
33%
32.4%
32%
31.4%
31%
30%
Additional Sources: OECD
25
Table of Contents
1
Main Economic Indicators
2
Balances
3
International Comparisons
4
Israel in the OECD
5
International Agreements
6
Learn More
7
Contact
26
International Comparisons
GDP Growth
Inflation Rates
Israel on IMD Rankings
Israel on WEF Rankings
Interest Rates: Israel & the U.S.
Stock Indices: NASDAQ & Tel-Aviv 100
27
GDP Growth
Israel compared to advanced economies, annual rate of change, constant prices
8%
Since 2004, Israel’s growth rate has exceeded the average growth rate of advanced economies.
In 2009, as most of the world experienced a decline in GDP, Israel experienced a 0.8% growth in it’s GDP.
6%
5.6%
5.5%
4.9%
4.8%
4.8%
4.0%
4%
3.1%
2.7%
3.1%
3.1%
2.8%
2%
0.8%
0.1%
0%
-2%
-4%
Israel
Additional Sources: IMF
Advanced Economies
-3.7%
28
Inflation Rates
Rate of change in consumer price index, yearly average
4%
The Israeli economy demonstrated high stability compared to other countries throughout the global economic crisis.
3.3%
3%
2.7%
2.4%
2.2%
2%
1.7%
1.6% 1.6%
1.6%
1.4%
1.2%
1%
0.7%
0.2%
0.1%
0%
-0.5%
-0.7%
-1%
-2%
2009 (dark)
Additional Sources: IMF
2010 (bright)
-1.6%
-1.7%
-0.3%
-0.9%
-1.4%
29
Israel on IMD Rankings
IMD World Competitiveness Yearbook 2011
The Institute for Management Development
ranked Israel 17th out of 59 countries for 2011
(Israel was also ranked 17th in 2010)
Additional Sources: IMD World Competitiveness Yearbook 2011
30
Israel on IMD Rankings
IMD World Competitiveness Yearbook 2011
Information technology skills
Central bank policy
Flexible and adaptability
Entrepreneurship
Additional Sources: IMD World Competitiveness Yearbook 2011
31
Israel on IMD Rankings
IMD World Competitiveness Yearbook 2011
Total expenditure on R&D (as % of GDP)
Scientific research
Venture capital
Innovative capacity
Additional Sources: IMD World Competitiveness Yearbook 2011
32
Israel on WEF Rankings
World Economic Forum Global Competitiveness Index 2011-2012
The World Economic Forum ranked Israel 22nd
out of 142 countries for 2011-2012
Additional Sources: World Economic Forum Global Competitiveness Index 2011-2012
33
Israel on WEF Rankings
World Economic Forum Global Competitiveness Index 2011-2012
Quality of scientific research institutions
Venture capital availability
Utility patents per million population
Strength of investor protection
Additional Sources: World Economic Forum Global Competitiveness Index 2011-2012
34
Israel on WEF Rankings
World Economic Forum Global Competitiveness Index 2011-2012
Government procurement of advanced technology products
Firm-level technology absorption
Capacity for innovation
University-industry collaboration in R&D
Additional Sources: World Economic Forum Global Competitiveness Index 2011-2012
35
Interest Rates: Israel & the U.S.
3.5%
3.0%
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%.
3.25%
3.00%
3.00%
2.75%
2.5%
2.50%
2.0%
2.00%
1.75%
1.5%
1.50%
1.0%
1.25%
0.5%
0.0%
Bank of Israel
Federal Reserve =0
36
Stock Indices: NASDAQ & Tel-Aviv 100
1,500
3,000
Tel Aviv 100 corresponds with the NASDAQ to current events, with relatively stable reactions.
1,400
2,900
1,300
2,800
1,200
2,700
1,100
2,600
1,000
2,500
900
2,400
800
2,300
700
2,200
600
2,100
500
Tel Aviv 100
NASDAQ
2,000
37
Table of Contents
1
Main Economic Indicators
2
Balances
3
International Comparisons
4
Israel in the OECD
5
International Agreements
6
Learn More
7
Contact
38
Israel in the OECD
Israel was invited as a full member in the OECD on May 10th, 2010, and officially joined in Sep. 10, 2010.
Expenditure on R&D
Real GDP Growth
GDP per Capita
Unemployment
39
Expenditure on R&D
As % of GDP, 2010 or latest available year
6%
Israel is 1st in the OECD in expenditure on R&D (research & development) as % of GDP, demonstrating innovation,
development and creativity.
5%
4.25%
4%
3%
2.33%
2%
1%
0%
Additional Sources: OECD
40
Real GDP Growth
3-year average, end of period
11%
10%
Israel’s 3-year average growth rate is higher then most OECD members.
9%
8%
7%
6%
5%
4%
3.19%
3%
2%
1%
0%
-0.10%
-1%
-2%
-3%
-4%
-5%
-6%
-7%
Additional Sources: OECD
41
GDP per Capita
U.S $, Current prices, PPP, 2010
100,000
90,000
80,000
70,000
60,000
50,000
40,000
30,000
34,025
28,510
20,000
10,000
0
Additional Sources: OECD
42
Unemployment Rate
3-year average 2008-2010, or latest available period
25%
Israel’s unemployment rate is in an ongoing downtrend, reaching an historic low level of 5.5% in Q2 2011.
20%
15%
10%
7.1%
7.7%
5%
0%
Additional Sources: OECD
43
Table of Contents
1
Main Economic Indicators
2
Balances
3
International Comparisons
4
Israel in the OECD
5
International Agreements
6
Learn More
7
Contact
44
International Agreements
Israel’s Free Trade Agreements
Avoidance of Double Taxation
Cooperation in Industrial R&D
Bilateral Investment Treaties
Economic Organizations
45
Israel’s Free Trade Agreements
QIZ Agreements
1985
USA
1992
EFTA
2004
Egypt
1997
Turkey
1998
Jordan
1997
Canada
1999
Mexico
2000
European Union (Association Agreement)
2007
MERCOSUR
More extended information is available in the Israel Ministry of Finance website
46
Avoidance of Double Taxation
Austria
Denmark
Ireland
Belarus
Estonia
Italy
Belgium
Ethiopia
Jamaica
Brazil
Finland
Japan
Bulgaria
France
Latvia
Canada
Germany
Lithuania
China
Greece
Luxembourg
Czech Republic
Hungary
Mexico
Croatia
India
More extended information is available in the Israel Ministry of Finance website
47
Avoidance of Double Taxation
Malta
Russia
Taiwan
Moldova
Singapore
Thailand
Norway
Slovakia
Vietnam
Netherlands
Slovenia
Turkey
Panama
South Africa
Ukraine
Philippines
South Korea
United kingdom
Portugal
Spain
Uzbekistan
Poland
Sweden
U.S.A
Romania
Switzerland
More extended information is available in the Israel Ministry of Finance website
48
Cooperation in Industrial R&D
North America
New York
Massachusetts
Maryland
Virginia
Wisconsin
Colorado
Illinois
Oregon
BIRD (Foundation)
Ontario CIIRDF (Foundation)
South America
Argentina
Uruguay
Brazil
Europe
France
Russia (Rusano, Skolkovo)
Italy
Asia
Germany
China( Shanghai, Jiangsu, Most)
Greece
India
Czech Republic
Taiwan
Bulgaria
Lithuania
SIIRD-Singapore (Foundation)
Slovenia
KORIL-RDF-Korea (Foundation)
Denmark
Hungary
Turkey
Portugal
Finland
Sweden
Australia
Ireland
(Victoria)
* Through EUREKA (40 country Multilateral
Initiative)
More extended information is available in the Israel Ministry of Finance website
49
Bilateral Investment Treaties
Albania
Cyprus
Hungary
Argentina
Czech Republic
India
Armenia
El Salvador
Kazakhstan
Azerbaijan
Estonia
Korea
Belarus
Ethiopia
Latvia
Bulgaria
Georgia
Lithuania
China
Germany
Macedonia
Croatia
Guatemala
Moldova
More extended information is available in the Israel Ministry of Finance website
50
Bilateral Investment Treaties
Mongolia
South Africa
Montenegro
Thailand
Peru
Turkey
Poland
Turkmenistan
Romania
Ukraine
Serbia
Uzbekistan
Slovakia
Vietnam
Slovenia
More extended information is available in the Israel Ministry of Finance website
51
Economic Organizations
Membership in main international economic organizations
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
More extended information is available in the Israel Ministry of Finance website
52
Table of Contents
1
Main Economic Indicators
2
Balances
3
International Comparisons
4
Israel in the OECD
5
International Agreements
6
Learn More
7
Contact
53
Learn More
Visit the Israel Ministry of Finance English
website for more information:
About the Ministry
Economic Overview of Israel
Ministry of Finance publications and reports
Other publications and reports on the Israeli economy
Ministry press releases
54
Learn More
Click to open:
Israel Central Bureau of Statistics
Bank of Israel
Ministry of Industry, Trade and Labor
Ministry of Foreign Affairs
Israel Government Portal
55
Table of Contents
1
Main Economic Indicators
2
Balances
3
International Comparisons
4
Israel in the OECD
5
International Agreements
6
Learn More
7
Contact
56
Contact
Mr. Roni Hershkovitz
Mr. Assaf Luxembourg
Mr. Jonah Balakhaneh
Overseas Economic Information
International Affairs Department
Ministry of Finance
State of Israel
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