Israel Weathering Economic Storm Due to High-Tech, High Exports
Despite sinking economic estimates for countries around the world, Israel continues to avoid an equivalent major economic downturn, largely due to the strength of Israeli exports and the country's emphasis on high-tech.
While global trade was slashed by 40 percent between August 2008 and February 2009, Israeli exports fell by only 30 percent. A Bank of Israel study attributes Israel's buoyancy to its emphasis on high-tech exports. The Bank of Israel study relied on a key international report finding countries with an advantage in high-tech being less negatively impacted by the worldwide economic crisis, according to the Globes online business magazine.
Israel's high tech exports account for 50% of its total exports, double the global average of 25 percent of world exports.
So resilient is Israel's economy, that its balance of payments surplus (seasonally adjusted) for the fourth quarter of 2008 was last matched in the second quarter of 2007, at the height of a global economic surge.
The $2.7 billion surplus in the first quarter of 2009 is more than triple the surplus in the final quarter of 2008, when it was just $0.8 billion, according to a June 15 report by the Central Bureau of Statistics (CBS). A substantial drop in imports was influential in the surplus.
The goods account is recording a surplus in the first quarter of 2009, after years of deficits.
Comparatively, the United States recorded a balance of payments deficit of $132.8 billion in the fourth quarter of 2008. Although the figure is astronomical, it is the lowest US deficit in five years.