Israel

Traditionally Israel spends a significant amount of funds on defence. According to the Stockholm International Peace Research Institute (SIPRI), Israel spends almost on average 6.3% of its Gross Domestic Product (GDP) on defence for the period 2006-2015. This trend was reaffirmed as the revised defence budget for 2016 reached 76.31 billion Israeli Shekel –ILS- (approximately 16.6 billion US dollars). This actually highlights the determination of the Israeli government to support a defence budget which will ensure that the armed forces will be able to deliver their core capabilities.

Israel is located in Southwest Asia and is divided into four main regions: the coastal plain to the west, along the Mediterranean, the mountainous central region, the Jordan Valley Rift to the east and the Negev desert to the south/southeast. The country’s financial and technology centre is Tel Aviv, while Jerusalem is the capital city.
 
Israel has a technologically intensive market economy, with a well-established rule of law which helps towards the direction of attracting international investment. According to the World Economic Forum, Israel was ranked 27th out of 140 countries for 2015-2016, in terms of competitiveness . More on that direction, the country scores rather well, in several international indicators measuring the openness of a country’s economic and business environments. Israel ranked 52nd out of 190 countries in the 2017 World Bank’s Doing Business report, 36th out of 180 countries in the 2017 Heritage Foundation’s Index of Economic Freedom and 21st out of 128 in the Global Innovation Index.

Year

Measure/Indicator

Rank

Website Address

2017

Doing Business report

(52 out of 190)

www.doingbusiness.org/

2017

Index of Economic Freedom

(36 out of 180)

www.heritage.org

2016

Global Innovation Index

(21 out of 128)

www.globalinnovationindex.org

Science and technology is one of the country's most highly developed and industrialized sectors. Several international high-tech companies, along with local Israeli entities (universities and/or companies) created the “Silicon Wadi” an area with a large concentration of high-tech industries, which was named after the Californian region of “Silicon Valley”.

Another sector in which Israel excels is that of Health & Life Sciences. More specifically, the country provides revolutionary solutions in the fields of digital imaging, medical equipment, medical laser technology, bioinformatics and drug research.

Moreover, several world class automotive companies, such as General Motors, Toyota, BMW, Fiat and Audi, have established or are establishing production facilities in Israel in order to develop cutting edge auto parts and progressive design technologies.Israel has also developed a wide range of world-renowned agricultural technology solutions. The country is home to over 200 innovative agricultural technology companies that export more than 3 Billion USD of products, annually. Additionally, the Israeli water technologies industry, accounts for 50% of the world’s low-pressure irrigation systems, as local companies have installed more than 350 desalination plants in some 40 countries around the world.

Finally, Israel has developed one of the best Semiconductor industries in the world. Currently, there are over 150 design centres and hundreds of companies, developing and designing semiconductors in the country.

Despite the fact that Israel is situated in a rather troubled region, it manages to provide an exceptionally good standard of living to its citizens (some 8.5 million in 2016), something that is highlighted by the country’s high score in the Human Development Index (HDI) indicator.

HDI measures human development and is published by the United Nations Development Program (UNDP). The factors that are taken into consideration in order to form the aforementioned index, are life expectancy, education (measured by adult literacy and gross enrolment in education) and standards of living (measured by purchasing power parity (PPP) income). The values of the index range from 0 to 1. Countries with an index below 0.5 are characterized as “underdeveloped”; countries with an index between 0.5 and 0.8 are characterized as of “medium development”, and countries with indexes higher than 0.8 are characterized as “highly developed”. In 2014, the HDI value for Israel was 0.894, which gives the country a rank of 18th out of 188 countries and territories considered. Since 1980, the HDI value of Israel has significantly increased from 0.750 to 0.894. Further, the country has recorded a substantial progress in each of the HDI indicators. Life expectancy at birth increased by 8.3 years, mean years and expected years of schooling increased by 2.7 years and 3.4 years respectively, while the Gross National Income (GNI) per capita increased by an impressive 111.6% over the same period.
 
On the international front, the country is a member of international organizations, such as the following:

  • United Nations’ Organizations
  • United Nations Agencies
  • World Bank Group
  • International Monetary Fund
  • OECD (Organization for Economic Co-operation and Development)
  • WTO (World Trade Organisation)
  • Pacific Alliance (observer)