Israel’s hightech – a major engine of growth

1. During the 3rd quarter of 2017, foreign acquisition of Israeli startups reached $1.7BN, a 17-year-old quarterly record (Globes Business Daily, November 20, 2017).

2. During the 3rd quarter of 2017, (144) Israeli startups raised $1.4BN, 14% higher than the 2nd quarter. $3.8BN were raised during the first three quarters of 2017, similar to 2016, which set all time high record (Globes October 25).

3. During the 3rd quarter of 2017, Israel’s GDP grew at a 4.1% annual rate, up from the 2.5% during the 2nd quarter. Israel’s exports rose in defiance of the very strong Shekel (due to Israel’s strong economic performance, benefitting from the dramatic reduction of energy imports). Private consumption rose 7.8%, acquisition of machinery grew 29.9% and the import of private cars expanded 38.9% (Globes, November 17).

4. “In 2017, investment in autonomous car startups is more than double the 2016 totals.While Silicon Valley is a known hotspot for autonomous driving, Israel is a pretty solid No. 2 for startup deals, with three of the 10 largest rounds this year. Intel’s $15.3 billion purchase of Mobileye, an Israel-based startup, is also the largest M&A deal for an autonomous driving-related company for this or any year.”

5. Japan’s Mitsubishi Tanabe finalized its $1.1BN acquisition of Israel’s Parkinson disease biotech Neuroderm (Globes, October 20).

6. Luxembourg’s CVC Capital Partners ($100MN) and London’s Pantheon Ventures ($50MN) participated in a round of private placement by Israel’s cybersecurity Skybox Security, which raised $96MN, in 2016, from Rhode Island’s Providence Equity Partners. Israel’s financial-tech BlueVine raised $130MN from the Sillicon Valley Bank, Atlanta’s SunTrust Bank, Menlo Park’s TriplePoint Venture Growth BDC Corp., etc. Israel’s ForeScout (network security solutions) raised $116MN on NASDAQ.

7. The NYC-based SK Capital acquired Israel’s ChemAgis (owned by the Michigan-based Perrigo) for $110MN (Globes, Nov. 23).

8. China’s $7BN Chengdu Kanghong Pharmaceutical Group acquired Israel’s I-Optima for $56MN in four stages, ending in 2021 (Globes, November 22). Germany’s Tentamus Analytics Laboratories holding group acquired Israel’s Analyst Research Laboratories for tens of millions of dollars. Analyst is owned by one of the three founders of Israel’s Neuroderm, which was bought in July, 2017 for $1.1BN by Japan’s Mitsubishi Tanabe.

9. British Telecom selected Israel’s AudioCodes to provide communications solutions, which raised the NASDAQ value of AudioCodes by 9% (a 56% surge in a year), its highest in 3.5 years. The Kansas-based Sprint expanded its contract with Israel’s satellite networking technology Gilat, including a 3-year-multimillion dollar project, triggering a 4.3% rise in its value (Globes, October 18).

10. South Korea-Israel trade balance is expanding, while a free-trade-agreement is negotiated. Israel’s export to South Korea rose 36% during January-August, reaching $560MN, mostly medical equipment, chemical and metal products. During the same period, Israel import from South Korea totaled $880MN, mostly cars and machinery. South Korea’s Hankuk Carbon concluded a cooperation agreement with Israel Aircraft Industries (IAI), establishing a joint venture, leveraging IAI’s unique experience in the area of developing and manufacturing unmanned aerial vehicles, focusing on vertical takeoff and landing capabilities (Globes, October 19).

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.

Recent Articles

Search

Israel’s hightech – a major engine of growth

The post-1967 turning point of US-Israel cooperation

Israeli benefits to the US taxpayer exceed US foreign aid to Israel

Iran - A Clear And Present Danger To The USA

Exposing the myth of the Arab demographic time bomb

Israel’s Covid-19 Economic Trends

The post-1967 turning point of US-Israel cooperation

Israeli benefits to the US taxpayer exceed US foreign aid to Israel

Iran - A Clear And Present Danger To The USA

Exposing the myth of the Arab demographic time bomb