1 / 24

The Israeli Economy: Still withstanding adverse global economic shocks December 2012

The Israeli Economy: Still withstanding adverse global economic shocks December 2012. The Israeli economy has experienced a drop in the GDP growth rate from over 5% to about 3%. Starting from mid-2013, natural gas will have a positive impact on Israel’s growth rate.

idana
Télécharger la présentation

The Israeli Economy: Still withstanding adverse global economic shocks December 2012

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. The Israeli Economy: Still withstanding adverse global economic shocks December2012

  2. The Israeli economy has experienced a drop in the GDP growth rate from over 5% to about 3%

  3. Starting from mid-2013, natural gas will have a positive impact on Israel’s growth rate

  4. One of Israel’s advantages is that it is a world leader in R&D and high-tech In 2009, 62% of Israel’s civilian R&D spending (US$4.7bn) took place in Israeli foreign owned companies. In addition, 92% of exported R&D services (US$3.4bn) originated from these companies. 4

  5. In “good periods”, Israel’s high-tech electronic goods exports tend to surge upwards more substantially than high-tech activity in the US 5

  6. Exports of high-tech services have grown substantially and are now equivalent in volume to the export of high-tech goods 6

  7. A balanced current account. There is no net foreign debt and there is a high level of FX reserves 7

  8. FDI inflows have seen a rebound, but foreign party’s portfolio outflows have increased 8

  9. Due to strong economic fundamentals, Israel was not affected in a substantially negative way by the ongoing series of global financial and economic shocks since 2007 • Are they still valid? • A high savings rate. Yes • A low level of housing supply. Yes, but not as extreme as in the past • A conservative banking system. Yes • Exports based on high-tech (non-consumer), along with greater global diversification of trade. Yes • Strong external accounts. Yes • Prudent fiscal policy. Not sure at the moment 9

  10. The resilience of Israel’s private sector is related to a high savings rate Household

  11. The labor force participation rate is low; this has an impact on the Israel’s growth potential and on the dependency ratio

  12. Israel’s unemployment rate is low; slow GDP growth is likely to result in an increase of unemployment in 2013

  13. The global crisis has had a modest impact on fiscal performance; Defense, social issues and GDP growth will affect future performance

  14. An undesired change in the debt/GDP trend

  15. The BoI adopted a flexible approach towards inflation targeting

  16. Residential construction has come out of a cyclical low, recovered quickly, and contributed to growth in 2010-2011 Immigration wave

  17. Housing prices peaked; Are the current market dynamics sufficient in order to sustain a gradual decline of prices?

  18. The rebound of housing prices started due to a shortage of supply; demand side factors contributed to the pace of price increases

  19. The rebound of housing prices started due to a shortage of supply; demand side factors contributed to the pace of price increases

  20. Despite a substantial increase in Israeli mortgage credit during 2007-2011, household leverage is still comparatively modest

  21. Israeli mortgage credit characteristics have been much more conservative than in other developed economies

  22. Risks to the forecasts • A Western world led global recession with renewed volatility in global financial markets. • Changes in the regional geopolitical outlook. • A prolonged deterioration of the security situation. • A regulatory and risk aversion led credit crunch in Israel

  23. The Israeli Economy: Still withstanding adverse global economic shocks December 2012

More Related