Israel’s economy marked another unusually strong quarter of growth in the first three months of 2018 as consumer spending, imports and investment soared, according to the Israeli paper Haaretz.
Gross domestic product grew an annualized 4.2% rate in the January-March period, the Central Bureau of Statistics reported on May 16 in a preliminary estimate. That was well ahead of the 3.9% average pace forecast in a Reuters poll of economists and marked the third straight quarter of expansion in excess of 4%.
Moreover, the CBS revised up its fourth-quarter gross domestic product growth estimate to an annualized 4.4% from 4.1%.
Intel submitted detailed plan for $5 billion plant expansion in Israel.
The plan, submitted in May, involves a major overhaul of the chip manufacturer's Fab 28 plant in the town of Kiryat Gat. Intel said it was responsible for $3.6 billion of Israel’s exports in 2017, which represents about 8% of the country’s total tech exports. The company also said its plants have produced $50 billion worth of goods throughout their entire lifetime. Local investments and acquisitions have totaled $35 billion. “Intel and Israel are a wonderful story of a partnership that started in 1974,” Intel’s top executive in the country, Yaniv Garty, said in a statement.
A report from the International Monetary Fund (May 2018) confirms strong economic growth for Israel.
The IMF praised the nation’s solid job market, government investment in infrastructure, and Israel's strong economic growth. According to the report, the Israeli economy grew by 3.4% over the course of 2017, led by local demand and improved global economic growth. In recent years, unemployment has dropped steadily and at the beginning of 2018 dropped below 4%, which supported an average rise in salaries of 3.3% across the board.
The Israel Export Institute and the Economy and Industry Ministry announced in May that the rapid growth that characterized Israeli exports in 2017 is continuing in 2018.
In the first quarter of 2018, exports of goods except diamonds rose by 6.5% from the same period in 2017, reaching $12.6 billion. Total exports of goods including diamonds totaled $14.5 billion in the first quarter, an increase of 1.6% from the previous year.
In a statement issued April 17, 2018, credit rating agency Fitch Ratings has affirmed Israel’s grade of ‘A+' with a stable outlook.
“Israel benefits from high financing flexibility, has deep and liquid local markets, good access to international capital markets, an active Diaspora bond program [emphasis added], and US government guarantees in the event of market disruption,” the agency noted. Israel’s economy was also acknowledged in the report as having a “robust macroeconomic performance and solid institutional strength” and was recognized as being “diverse and advanced” due to its “well-developed institutions and education system.”
The Bonds organization is proud to be a vital partner in the fortification of Israel’s economy and is appreciative of all Israel bond investors for helping to reach this accomplishment. (Israel bonds are not rated).
A $15 billion deal in 2018 to export Israeli gas to Egypt brings the formerly resource-poor Jewish state a step closer to becoming an energy exporter to the most populous Arab country.
The contract will “position Israel as a central player in the regional energy sector,” remarked Israel Energy Minister Yuval Steinitz.
Intel to invest $4.5 billion in Israel in 2018.
"Intel has decided to invest billions of dollars in Israel in 2018," Minister of Finance Moshe Kahlon told the Knesset Finance Committee Sunday. Intel previously invested $6 billion in 2016 and 2017 to expand and upgrade its plant in Kiryat Gat, making it one of the world's most advanced chip fabs.
Standard & Poor’s (S&P) holds Israel’s rating at investment grade, with a positive outlook.
S&P, the provider of independent credit ratings, issued a report in February 2018 reaffirming Israel’s credit rating at third-highest investment grade with a positive outlook, stating it expects Israel’s economy to remain strong. “The ratings are supported by Israel’s prosperous and diverse economy, strong external balance sheet, and flexible monetary framework,” S&P highlighted in the report. (Israel bonds are not rated).
Israeli exports for 2017 expected to pass $100 billion for the first time.
A preliminary report on Israeli export activity for 2017 shows a 5% rise in total exports of goods and services, with a 3% boost in industrial exports, a 2% jump in agricultural exports, a 7% increase in export of high-tech services and a 20% improvement in Israeli exports to the European Union.
Israel signs first-of-its-kind agreement with Japan to facilitate Japanese investments in Israeli companies.
In December 2017, a delegation headed by Israel’s Minister of Economy Eli Cohen and eleven Israeli cyber firms reached a deal which aims at increasing bilateral trade between the two countries, allowing Israeli advanced manufacturing companies to work with companies from Japan, a nation home to the world’s third largest economy.
DowDuPont, conglomerate of two major U.S. corporations formed in 2017, expanded operations in Israel in the same year.
"Israel is one of the economies with the swiftest growth in the world and many of Israel's companies are leaders in technologies and services that will help companies and communities to prosper worldwide," said Dow Chemical Co. EVP and president of Dow Europe, Middle East, Africa & India, Heinz Haller at a ceremony in Tel Aviv in October 2017.
Intel has completed the first stage of the $15.3 billion purchase of Mobileye, an Israeli technology company that specializes in producing sensors and cameras for autonomous cars, as of August 2017.
The acquisition is expected to accelerate innovation for the automotive industry and positions the global microchip giant as a leading technology provider in the fast-growing market for highly and fully autonomous vehicles.
BlackRock, Inc., an American global investment management corporation based in New York City which oversees $5.4 trillion in assets, opened its first office in Israel in 2017, tapping into the country’s engineers and programmers to help improve the firm’s global platform in a changing asset-management industry.
Israeli high-tech companies closed 104 deals in 2016 worth $10 billion, up 12% from 2015, according to the IVC - Meitar High-Tech Exits Report.
The figure includes 93 mergers and acquisitions worth nearly $8.8 billion, including the $4.4 billion Playtika acquisition, eight buyouts that generated $1.22 billion and three small IPOs totaling $15.1 million.
With a growth rate standing at 1.8 percent, the highest in the Organization for Economic Cooperation and Development, Israel’s population topped 8.7 million on Erev Rosh Hashanah 5777.
Israel’s birth rate was 3.11% on the year, with 181,405 babies being born, and the country saw 27,000 people move to Israel over the last year of whom 25,000 were new immigrants.
In a statement issued August 4, 2017, credit rating firm Standard & Poor’s raised the outlook on Israel’s debt profile to "positive" from "stable," and held Israel's debt rating stable at A+, which means it could raise the grade a notch in the next two years.
"The rating action reflects our opinion that Israel's improved fiscal framework and strong economic growth could enable further progress on fiscal consolidation over the next few years," the agency remarked.
The Bonds organization takes pride in the role it has played in strengthening Israel’s economy and thanks every Israel bond investor for helping to make this achievement possible (Israel bonds are not rated).
View the most recent Government of Israel Ministry of Finance Office of the Accountant General Investor Newsletter here.
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