Israel’s economy – an island of stability

1. According to a study conducted by the University of Lausanne, Israel is one of the top five world high-tech powers, as indicated by a 2015 $1bn investment, in Israel, by Apple, creating a hardware development center. The USA, China, Russia and India are, actively, soliciting high-tech cooperation with Israel. India and Israel negotiate a free trade zone, which would increase their current $5bn trade balance. Israel is second only to Russia in the exportation of military systems to India (Jerusalem Post, July 24, 2016).

2. $245mn raised by Israeli companies in July, 2016; $2.9bn raised, so far, in 2016 ($1.7bn in the 2^nd quarter and$1.1bn in the 1^st quarter). For example, SafeBreach (cyber) raised $15mn from HP, Deutsche Telecomm, etc.; Prospera (agricultural tech) raised $7mn from the Silicon Valley-headquartered Bessemer Venture Partners; PowerLinx (business matching) raised $7mn from Dun & Bradstreet, France; and Engie (car maintenance) raised $3.5mn from the San Francisco-based 8Partners, the San Francisco Peninsula-based Motus Ventures. (Globes Business Daily, July 27, 2016), etc.

3. Israel’s Emefcy raised $24mn from US, Chinese, Hong Kong, Singapore and Australian investors (GE Ventures was one of the initial investors), in order to advance its 44 sewage-recycling projects in the US, Israel, Latin America, Ethiopia and, mostly, in China (Globes, July 26). GuardiCore raised $20mn from Cisco, the London and Israel-based 83North, and the Silicon Valley and Israel-based Battery Ventures. SkyCure raised $16.5mn from the Silicon Valley-based Foundation Capital (Globes, July 20).

4. The Israeli gambling websites giant, 888, is negotiating a merger with the British giant, Rank, in order to acquire the $3.6bn British giant, William Hill (Globes), July 25).

5. A US-Israel cyber cooperation in the protection of financial payments from malicious hacker attacks – which could result in mega billion dollar catastrophes – was announced in Atlanta, GA. Israeli companies excel in the development of firewalls (Globes, July 3).

6. The following is a sample of vital data featured in Adam Reuter’s (Financial Immunities) and Noga Kainan’s (Company Leaders Forum):

*Israel’s economy has expanded by 180% during the past 20 years, while the population (8.4mn) has grown by 45%;

*Israel’s GDP is in excess of $300bn compared to $1.2bn in 1949 and $155bn in 2006, GDP per capita is $35,000 (24^th in the world);

*Israel’s foreign exchange reserves reached $90bn, an indication of financial stability, bolstered by a highly diversified, high-quality commercial and defense exports, thus minimizing the impact of global slowdown;

*Israel’s ratio of public debt to GDP is systematically shrinking (64%), unlike most OECD;

*Israel’s unemployment rate is decreasing (5%), while labor force participation rate is expanding (77%);

*Israel is among the only 8 countries launching space satellites, a global co-leader with the US in the areas of research, development, manufacturing and launching mini, small and medium-size space satellites;

*Israel is the world leader in the area of per capita research & development: 140 per 10,000 employees;

*86 Israeli companies are traded on NASDAQ, third following the USA and China.

*About 300 global high-tech giants established research & development centers in Israel, leveraging Israel’s brainpower;

*Israel’s population is the youngest in the OECD – median age 31 (OECD – 42), featuring the highest fertility rate (number of births per woman), including an unprecedented surge in secular fertility;

Straight from the Jerusalem Boardroom #248
https://bit.ly/3u29k9g

Foreign investment in Israel’s high-tech companies surged to new heights in the 1^st quarter of 2021 – $5.7bn in 172 deals – which is up 89% over the impressive 4^th quarter of 2020 and double the volume of the 1^st quarter of 2020.

2020 was the first year of surpassing $10bn in capital raised by the Israeli high-tech sector from investors in the US, Asia and Europe, who trust the maturity of Israel’s brain power. Investments in Israeli companies more than tripled in six years, reflecting the effective response by Israeli startups to the technological, medical, pharmaceutical, educational, social and digital challenges posed by Covid-19.

Israel’s economic performance in defiance of Covid-19 is presented by Dr. Adam Reuter, the Chairman and Founder of “Financial Immunities,” Israel’s largest financial-risk management firm, and the co-author of Israel – Island of Success:

Israel has led the globe in the rapid administration of Covid-19 vaccinations due to effective negotiations with Pfizer and an efficient, country-wide medical infrastructure.
Israel is the second lowest among OECD countries in the number of Covid-19 deaths per number of Covid-19 cases: 0.7% compared to the 2.3% OECD average. Israel features a young population (median age of 30 compared to the OECD’s 42) and an effective country-wide medical infrastructure, including top level HMOs and hospitals.
Israel is ranked 12^th from the bottom among the 37 OECD countries in the number of deaths per million inhabitants: 645 compared to 1,145 OECD average.
The International Monetary Fund’s 2025 GDP growth forecast for OECD countries: Israel – 4%, OECD average – 2.2%, US – 1.8%, Australia – 2.5%, Ireland – 2.6%, France and Canada – 1.7%, the UK – 1.6%, Germany – 1.2%, etc.
Israel’s 2020 GDP was reduced by 2.5%, compared to the OECD average reduction of 4.1%, South Korea – 1%, Norway – 0.8%, Australia – 2.6%, US – 3.5%, Japan – 4.8%, Germany – 5%, France – 8%, the UK – 10% reduction, etc. GDP growth was recorded in New Zealand – 2.4% and Ireland – 3.5%.
In 2020, Israel was ranked 20^th among the 37 members of the OECD in terms of GDP per capita, featuring $43,000 (GDP – $408bn), ahead of Japan, Italy and Spain, and very close behind the UK ($44,000) and France ($45,000).
Israel’s debt-to-GDP ratio increased from 60% in 2019 to 72% in 2020, compared to the OECD’s average increase from 66% to 82%. The 2020’s debt-to-GDP ratio was 266% in Japan, Italy – 161%, the US – 131%, Germany – 73%, etc.
Israel’s foreign exchange reserves-to-GDP ratio of 41% (3^rd among the OECD countries) attests to its financial stability, and Israel’s capability to raise foreign credit promptly in a cost-effective manner. Israel’s foreign exchange reserves in March 2021 – $186bn.
During the past decade, Standard and Poor (S&P) accorded Israel a positive credit rating trend, unlike the negative trend for the G-7 countries. In 2020, notwithstanding Covid-19, Israel’s credit rating (S&P) remained at AA.
Some 380 global high-tech giants operate in Israel, including Microsoft, Amazon, IBM, Intel, Cisco, Apple, Verizon, Applied Materials, Dell, HP, Kodak, Oracle, Philips, SAP, Medtronics, GM, eBay, GE, etc. Israel leads the world in the ratio of research and development investment to GDP: 4.9%. 85% of this investment comes from the business sector.

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