Bank of Israel/ Wikipedia
The Jewish New Year – Rosh Hashanah – begins at sundown Friday night. The year 5783 will end and 5784 will begin. Here is the Jewish Business News list of the top 5 stories about the Israeli economy from over the past year.
The economy is doing all right in general, but the Shekel plummeted in recent months due to the political turmoil surrounding the Benjamin Netanyahu government’s controversial judicial reform plans. While rating agencies gave Israel good marks, they all warned that moving forward with more of the reforms could spell disaster for its economy.
Israel Saves $86 Billion from Natural Gas Use
Israel has seen unprecedented growth in its natural gas sector over the past decade. This is according to a report released in August by BDO and The Israeli Natural Gas Trade Association.
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Cumulative savings to Israel’s economy over the past decade, said the report, was over NIS 316 billion ($86 billion). This amounted to savings of more than NIS 120,000 ($28,000) for every household in Israel during that time… Read more here
Foreign Controlled Firms Paid Israelis $17 Billion 2018 – 2021
In the four year period of 2018 – 2021, Israeli firms owned by foreign entities brought a total of $17 billion into the country in salaries for Israelis alone. This is according to data released by Israel’s Central Bureau of Statistics in August. Israel Startup Nation depends on foreign investment to continue with all of its innovations and successes. In some cases, foreign investors take majority stakes in Israeli startups. And when an Israeli firm makes its exit, it is either through an IPO or a buyout by a foreign concern.
This is why foreign-owned firms are such a significant part of the local economy… Read more here
Fitch Preserved Israel’s A+ Rating But With Warnings
In August, international credit ratings agency Fitch reaffirmed Israel’s ‘A+’ sovereign credit rating while giving the country’s economy a “stable” outlook. However, the firm did have some bad news for Israel too, specifically regarding the country’s current political turmoil surrounding a controversial government judicial reform plan.
And the reaffirmation means that Fitch did not raise Israel’s rating. This after the firm hinted in May that it would be amenable to raising the rating that it gives Israel should the government of Prime Minister Benjamin Netanyahu drop its planned controversial judicial reform program. While Netanyahu has hinted to foreign media – while speaking in English – that he is not going to push for the more drastic and contentious parts of the plan, he has yet to make any definitive comments on the matter to the Israeli public… Read more here
Morgan Stanley Predicted Strong Outlook for Israel In 2023
In July, Morgan Stanley, the powerhouse American investment bank, predicted a strong 2023 for Israel, in a rebound after a weak 2022 caused mainly by the worldwide financial crisis and global inflation. The firm sees as much as %2.5 percent economic growth for the country, but there is a catch. Morgan Stanley tied this forecast to whatever the government of Prime Minister Benjamin Netanyahu chooses to do with his controversial judicial reform plans.
On that issue. In its report, Morgan Stanley stated, “Domestic instability related to the proposed changes in the judicial system affects the economy both in the short and medium term: The heightened uncertainty related to the judicial reform can be characterized as a risk premium shock.” Read more here
Bank of Israel Warned Benjamin Netanyahu Government’s Policies Hurting Economy
In August, the Bank of Israel issued a dire warning about the state of Israel’s economy, saying it has been harmed by the legislative programs promoted by the government of Prime Minister Benjamin Netanyahu. The corps issue here was the Netanyahu government’s controversial judicial reform plan. Israel’s political opposition charges that the plan will cause irreparable damage to its democratic nature because it includes removing the power of Israel’s Supreme Court to serve as a “check” on government actions.
The warning came by way of the Bank of Israel’s financial stability report, which is published twice a year. In this report, the bank’s economists express their assessment regarding the exposures to the main risks faced by the financial system, analyze the main exposures and evaluate potential risk scenarios… Read more here
