Transcript Israel Economic Highlights Presentation 2012

STATE OF ISRAEL
MINISTRY OF FINANCE
Economics and State Revenues Department
Economic Highlights Presentation
4th Quarter 2012
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 Indicators
2
Real Economy
3
Foreign Trade and Balance of Payments
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
2
Economic Figures
Criteria
2011
2012
2012 Q1
2012 Q2
2012 Q3
2012 Q4
GDP
(Current prices in $B)*
243.7
241.7
59.8
60.7
60.2
61.0
Real GDP growth rate
(% change)
4.6%
3.2%
2.7%
2.9%
2.8%
2.5%
$31,384
$30,571
7,611$
7,699$
7,593$
7,664$
2.7%
1.3%
0.9%
1.2%
0.9%
0.4%
91.0
90.5
37.5%
36.7%
39.4%
36.8%
36.9%
(As % of GDP)
92.1
37.8%
91.8
38.0%
24.2
40.5%
23.4
38.5%
22.6
37.6%
21.7
35.6%
Unemployment rate
7.1%
6.9%
6.8%
6.9%
6.8%
6.9%
GDP per capita
(Current $)
GDP per capita growth rate
(%, 2005 prices)
Exports (goods & services), $B*
(As % of GDP)
Imports (goods & services), $B*
37.3%
21.9
23.9
22.1
22.5
*Using a periodic average exchange rate.
Sources: CBS, IMF
3
Economic Figures
Criteria
2007
2008
2009
2010
2011
2012
Public debt
(As % of GDP)
77.8%
77.1%
79.3%
76.3%
74.0%
74.0%*
General government expenditure
(As % of GDP)
43.6%
43.0%
43.0%
42.6%
42.3%
-
Current account surplus
(As % of GDP)
2.9%
0.9%
3.7%
3.8%
0.8%
-0.5%**
Inflation rate
(CPI, yearly average, % change)
0.5%
4.6%
3.3%
2.7%
3.5%
1.7%
Budget deficit
(As % of GDP)
0.0%
2.2%
5.2%
3.7%
3.3%
4.2%
* MoF Estimates
** First three quarters at annual rate.
4
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payments
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
5
GDP and Business GDP
Annual rate of change, constant prices, 2005
6
GDP Growth
Israel compared to advanced economies, annual rate of change, constant prices
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.
* MoF forecast, Euro stat and OECD forecast
Source: CBS, Eurostat, BEA
7
GDP Components
Real Annual Percentage Change
Effects of the global
economic crisis
8
GDP per Capita
$ U.S, Current prices, Current PPP, 2011
Additional Sources: OECD
9
Output Gap
As percentage of Potential GDP, 2012
The actual - potential GDP Difference.
Positive index means that actual output is higher than potential.
Additional Sources: OECD Estimates
10
Stock Exchange Indices
Percentage Change, end of period relative to end of previous period
Additional Sources: TASE, Bloomberg
11
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payments
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
12
Exports of Goods and Services
As a share of GDP
Effects of the global
economic crisis
13
Main Trading Partners
$ US Billions, 2012
* The data on trade with Hong-Kong is added to the data on China
Source: Central Bureau of Statistics
14
Main Export Destinations
As a share of total exports
Source: Central Bureau of Statistics
15
Current Account Surplus
As % of GDP
* 2012 first three quarters at annual rate.
Source: Central Bureau of Statistics
16
Foreign Investments
$ US Billions
* In 2006, a large acquisition by Teva Pharmaceutical Industries Ltd. was included in the data.
** 2012 first three quarters at annual rate.
Source: Central Bureau of Statistics
17
Exchange Rates
31 December 2012 vs 31 December 2011
The annual change in the specified currency relative to the $ US
A decrease means an appreciation of the specified currency relative to the $ US
Source: Pacific Exchange Rate Service
18
Terms of Trade
2005 average = 100
Terms of Trade = Export Prices to Import Prices Ratio
Source: Central Bureau of Statistics
19
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 comprehensive information is available on the Israel Ministry of Finance website
20
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
Moldova
Croatia*
Guatemala
Macedonia*
*Comprehensive information is available on the Israel Ministry of Finance website
21
Bilateral Investment Treaties
Turkey
Montenegro
Poland
Turkmenistan
Ukraine*
Romania
Uruguay
Serbia
Uzbekistan
Slovakia
Slovenia*
South Africa*
Thailand
*Comprehensive information is available on the Israel Ministry of Finance website
22
Economic Organizations
Membership in main international economic organizations
Israel is a member of leading international economic organizations:
• United Nations Organizations
• United Nations Agencies
• World Bank Group
• International Monetary Fund
• OECD
• Regional Organizations
• Inter-Governmental Organizations
More comprehensive information is available on the Israel Ministry of Finance website
23
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payments
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
24
Unemployment and Participation
As % of total labor force
Since the 2nd quarter of 2009 unemployment is relatively decreasing, with a gradual increase in the
participation rate since the beginning of 2010.
Source: Central Bureau of Statistics
25
Unemployment Rate
Latest available data
Additional Sources: OECD, Euro Stat, CBS
26
Job Creation
Change in the number of employees
Effects of the global
economic crisis
Annual average relative to previous year average.
Source: Central Bureau of Statistics
27
Employment Rate
15+, latest available quarterly data
Additional Sources: OECD, Euro Stat
28
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payments
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
29
General Government Expenditure
As % of GDP
Source: Central Bureau of Statistics
30
General Government Tax Burden
As % of GDP
OECD countries average: 33.8%
(2011 average)
Source: Central Bureau of Statistics, OECD
31
General and Central Budget Deficit
As % of GDP
32
Public Debt
As % of GDP
Effects of the global
economic crisis
* MoF Estimates
33
Public Debt
As % of GDP, international comparison
Source: OECD
34
Israel’s Credit Ratings
Updated to mid-September, 2012
Rating Firm
Moody's
Standard & Poor's
Fitch
Term
Domestic Bonds
Rating
Long
A1
Short
-
Long
AA-
Short
A-1+
Long
A+
Short
April 2008
Moody’s upgrade
Israel To A1
Forecast
Overseas Bonds
Rating
A1
Stable
P1
A+
Stable
A-1
A
Stable
F1
Sep 2011
S&P upgrade
Israel To A+
Nov 2007
S&P upgrade
Israel To A
Feb 2008
Fitch upgrade
Israel To A
35
Avoidance of Double Taxation
Austria
Denmark
India
Belarus
Estonia
Ireland
Belgium
Ethiopia
Italy
Brazil
Finland
Jamaica
Bulgaria
France
Japan
Canada
Georgia
Latvia
China
Germany
Lithuania
Croatia
Greece
Luxembourg
Czech Republic
Hungary
More comprehensive information is available on the Israel Ministry of Finance website
36
Avoidance of Double Taxation
Taiwan
Mexico
Russia
Moldova
Singapore
Netherlands
Slovak Republic
Norway
Slovenia
UK
Panama
South Korea
Ukraine
Philippines
South Africa
USA
Poland
Spain
Uzbekistan
Portugal
Romania
Sweden
Thailand
Turkey
Vietnam
Switzerland
More comprehensive information is available on the Israel Ministry of Finance website
37
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payment
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
38
Inflation Rate
Rate of change in consumer price index
Source: Central Bureau of Statistics
39
Interest Rate
Source: Bank of Israel
40
Central Bank’s Interest Rates
International Comparison
Source: Specified Countries’ Central Banks
41
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payments
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
42
Industrial Production
Annual Growth
Total industrial production grew by 4.4%
2012 January-November average relative to 2011 average
Source: Central Bureau of Statistics
43
Industrial Export
Current U.S. $ Billions
78.3% 79.1%
78.4%
74.5%
74.9%
79.1%
74.7%
76.3% 75.5%
71.0%
Source: Central Bureau of Statistics
72.8%
73.3%
73.4% 72.5%
44
Israel is a World Leader in Science,
Technology, and Innovation
5
Civilian R&D as % of GDP, 2009
4.4
3.9
4
3
2.8
2.3
2.0
2
1.9
1.8
1.8
1.8
1.7
1.6
1.4

1st in R&D expenditure of as % of GDP*

1st in quality of scientific research institutions**

1st for entrepreneurship being widespread amongst its managers*

2nd in public expenditure on education*

3rd in venture capital availability**

4th in PCT patents applications per million population**

5th for strength of investor protection**

6 Israelis in the last 10 years have been awarded Nobel Prizes in
the fields of Economics or Chemistry
1.3
Global Competitiveness Report 2012-2013
Italy
Spain
Czech Rep.
Norway
Ireland
United Kingdom
Canada
Belgium
France
Germany
Finland
Israel
0
EU27
1
“The country’s main strengths remain its world-class capacity for innovation
(3rd), which rests on highly innovative businesses that benefit from the presence
of the world’s best research institutions geared toward the needs of the business
sector. Israel’s excellent innovation capacity, which is supported by the
government’s public procurement policies, is reflected in the country’s high
number of patents (4th). Its favorable financial environment, particularly evident
in the ease of access to venture capital (3rd), has contributed to making Israel an
innovation powerhouse..”
Source: OECD Science, Technology and Industry Scoreboard 2011. * International Institute for Management Development (IMD) Global Competitiveness
Yearbook 2011. ** World Economic Forum (WEF) Global Competitiveness Report 2012-2013.
45
Israel in IMD Rankings
IMD World Competitiveness Yearbook 2012
(1) Hong Kong 1
(1) USA 2
(5) Switzerland 3
(3) Singapore 4
(4) Sweden 5
(7) Canada 6
(6) Taiwan 7
(13) Norway 8
(10) Germany 9
(8) Qatar 10
(14) Netherlands 11
(11) Luxemburg 12
(12) Denmark 13
(16) Malaysia 14
(9) Australia 15
The
Institute
for
Management
Development ranked Israel 19th out of
59 countries for 2012.
Israel
has
been
ranked
1st
entrepreneurship and 9th at economy
resilience.
(28) UAE 16
(15) Finland 17
(20) United Kingdom 18
(17) Israel 19
(24) Ireland 20
Source: IMD World Competitiveness Yearbook 2012
at
46
Israel in IMD Rankings
IMD World Competitiveness Yearbook 2012
Israel’s ranking compared to other IMD countries,
Business Efficiency and Infrastructure
Source: IMD World Competitiveness Yearbook 2012
Israel’s ranking compared to other IMD countries,
Economic Performance and Government Efficiency
47
Israel in WEF Rankings
World Economic Forum Global Competitiveness Index 2012-2013
The World Economic Forum ranked Israel 26th
out of 144 countries for 2012-2013 in terms of
competitiveness.
The Forum also ranked Israel:
1st in Quality of scientific research institutions
3rd in Venture capital availability
4th in PCT patents, applications/million pop.
5th in Strength of investor protection
5th in Firm-level technology absorption
6th in Capacity for innovation
6th in Company spending on R&D
And 8th in University-industry collaboration in
R&D
Source: World Economic Forum Global Competitiveness Index 2011-2012
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
Italy ( and Trento county)
Asia
Germany
China (Shanghai, Jiangsu,
Greece
Shenzhen, Federal)
Czech Republic
India
Bulgaria
Lithuania
Slovenia
SIIRD-Singapore (Foundation)
Denmark
KORIL-RDF-Korea (Foundation)
Hungary
Turkey
Portugal
Finland
Sweden
Australia
Ireland
(Victoria)
Spain
Cyprus
Netherlands
* Through EUREKA (40 country Multilateral
Initiative)
More comprehensive information is available on the Israel Ministry of Finance website
49
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payment
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
50
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
51
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
52
Table of Contents
1
Main Indicators
2
Real Economy
3
Foreign Trade and Balance of Payment
4
Labor Market
5
Fiscal Stance
6
Price Stability and Monetary Policy
7
Innovative Economy
8
Learn More
9
Contact
53
Contact
Mr. Roni Hershkovitz
Mr. Ori Kaufman
Mr. Amichai Fishler
Overseas Economic Information
Economics and State Revenues
Department
Ministry of Finance
State of Israel
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