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Israel’s Year in Review

By Naomi Miller, MIBA – Director of Israel Partnerships

With the arrival of the Jewish new year on September 25, Israel commenced a 3-week holiday period including Yom Kippur, the Day of Atonement; Sukkot, the Feast of Tabernacles; and Simchat Torah, the celebration of the completion of the yearly cycle of reading the Torah. In Jewish tradition this period is a time to look back on the past year to soul search and reflect. So, what does Israel have to show for the last year?

According to Israel’s Bureau of Statistics, 177,000 babies were born, and 59,000 new immigrants (predominantly from the Ukraine and Ethiopia) were welcomed to its shores, the highest immigration rate in two decades.  As a result, Israel’s population increased by 2%, reaching 9.5 million citizens. The economic news is mixed. Israel’s inflation rate has hit 4.6%, the highest in two decades, but it is still less than half the average of most OECD countries, with state expenditures actually falling by 9%, mainly due to the end of Covid aid.

According to Israel’s Accountant General, the year ended with a fiscal surplus of 9.8 billion shekels in the state coffers. Real estate is still the leading financial concern for many Israelis. The supply of apartments remains significantly lower than the demand and the steady increase in prices (estimated 18% over the last year) has many young couples despairing of ever owning a home in Israel. Housing construction policy will remain a major priority for future governments.

On the technology front, hi-tech accounted for 16% of Israel’s GDP, up from 12% just five years ago, making it among the highest percentages in the world. Over the last 12 months, Israeli startups raised $26 billion and 20 new unicorns were born in the first half of 2022. On the national transportation front, the overly congested city of Tel Aviv will finally see the launch of its first light rail line by the end of 2022.

Amid rising tensions in the West Bank, Israel launched a military operation in the first week of August in Gaza against the Iranian- backed terror organization Islamic Jihad. The IDF expected Operation Breaking Dawn to play out over a week, but ultimately its goals were accomplished in 66 hours without any Israeli civilian or military casualties.

Perhaps it’s no longer news, but elections are on the Israeli calendar once again, for the fifth time in four years.  After the collapse of a fragile coalition on June 20, foreign minister Yair Lapid took over as caretaker prime minister from Naftali Bennet, as per an existing agreement. Israelis will head back to the polls on November 1. Despite increased inflation, a volatile security situation, exorbitant housing prices and government instability, polls show that 89.3% of Israelis are content with their lives and 66.8% are satisfied with their economic condition.  

As Israel looks back on the previous year and forward to the 75th anniversary of the state’s founding, rising economic mobility and a strong sense of national purpose enable Israelis to count their blessings and look forward to a brighter future in the coming year.