The Resilience of Israel’s Economy

 For full article see  https://www.jpost.com/aliyah/assisted-living-facilities/article-855353

To understand the resilience of Israel’s economy, one must look at the objective data that reflects a country’s ability to withstand times of crisis. At the start of the "Iron Swords" war, various economic indicators showed significant declines. However, these downturns lasted only a few months. Soon after, the economy bounced back to full strength—despite the ongoing war, rocket attacks from multiple directions, and the uncertainty weighing on the country's citizens.

How did this happen? Credit usage returned to pre-war levels. The shekel, which had weakened and crossed the four-shekel-per-dollar mark in late 2023, regained its value. The demand for housing, both from Israeli citizens and foreign buyers, steadily increased.

When a Jewish person abroad fears walking the streets wearing a kippah, speaking Hebrew or showing an affiliation to their traditions, the national homeland becomes an almost immediate preferred investment—securing the future. That is precisely what happened in Israel throughout 2024. The number of Jewish buyers purchasing homes in Israel surged significantly, contributing to the economy’s return to normal activity levels.

Furthermore, despite the prolonged war, Israel is expected to see economic growth of 4% over the next two years—matching the pace of leading global economies. Unemployment remains very low, fluctuating between 2.6% and 3.7%, figures that effectively indicate full employment. While the debt-to-GDP ratio initially climbed to 72%, it has since returned to 69%. When compared to countries like the U.S., Italy, the U.K., France, or Austria, Israel’s economic standing is remarkably strong. Macroeconomic data points to highly effective economic management by the Bank of Israel.

When comparing stock market performance, the Tel Aviv Stock Exchange outperformed the New York Stock Exchange in 2024.

So, what is the foundation of Israel’s economic strength? First and foremost—its people. Israel’s GDP per capita stands at approximately $58,000, ranking it 13th in the world. The country benefits from capital, cutting-edge technology, but above all, highly talented and deeply committed individuals who invest immense effort in maintaining a strong economy and a high quality of life.