Economy of Israel

(wikipedia.org)
Updated: 2009-09-17 13:49

Israel is considered one of the most advanced countries in Southwest Asia in economic and industrial development. The country is ranked 3rd in the region on the World Bank's Ease of Doing Business Index as well as in the World Economic Forum's Global Competitiveness Report. It has the second-largest number of startup companies in the world (after the United States) and the largest number of NASDAQ-listed companies outside North America. In 2007, Israel had the 44th-highest gross domestic product and 22nd-highest gross domestic product per capita (at purchasing power parity) at US$232.7 billion and US$33,299, respectively. In 2007, Israel was invited to join the Organisation for Economic Co-operation and Development, which promotes cooperation between countries that adhere to democratic principles and operate free market economies.

A main business district in Ramat Gan, where the diamond stock exchange is located

Despite limited natural resources, intensive development of the agricultural and industrial sectors over the past decades has made Israel largely self-sufficient in food production, apart from grains and beef. Other major imports to Israel, totaling US$47.8 billion in 2006, include fossil fuels, raw materials, and military equipment. Leading exports include fruits, vegetables, pharmaceuticals, software, chemicals, military technology, and diamonds; in 2006, Israeli exports reached US$42.86 billion. Israel is a global leader in water conservation and geothermal energy, and its development of cutting-edge technologies in software, communications and the life sciences have evoked comparisons with Silicon Valley. Intel and Microsoft built their first overseas research and development centers in Israel, and other high-tech multi-national corporations, such as IBM, Cisco Systems, and Motorola, have opened facilities in the country. In July 2007, US billionaire Warren Buffett's Berkshire Hathaway bought an Israeli company Iscar, its first non-US acquisition, for $4 billion. Since the 1970s, Israel has received economic aid from the United States, whose loans account for the bulk of Israel's external debt. In 2007, the United States approved another $30 billion in aid to Israel over the next ten years.

Tourism, especially religious tourism, is another important industry in Israel, with the country's temperate climate, beaches, archaeological and historical sites, and unique geography also drawing tourists. Israel's security problems have taken their toll on the industry, but the number of incoming tourists is on the rebound. In 2008, over 3 million tourists visited Israel.