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Israel’s GDP rose by 3.1% in 2nd quarter of 2023, outperforming OECD average

Shoppers enjoy the sales season at a shopping mall in the northern Israeli city of Tiberias, August 17, 2023. (Photo: Michael Giladi/Flash90)

The Jewish state’s national Gross Domestic Product expanded by 3.1% during the second quarter of 2023, the Israeli Central Bureau of Statistics revealed on Tuesday.

By comparison, GDP growth in OECD member states was merely 0.4% during the same period.

However, Israeli GDP per capita only expanded by 1.2% due to Israel’s comparatively high population growth of approximately 2% per year.

In addition, imports of goods and services decreased by 9.7%, indicating that Israelis, like many other nations, are trying to increase their savings in the currently volatile global economy.

Private consumption expenditure per capita fell by 1.3% during this year's second quarter. The largest drop, 10.9%, was noted in spending on clothes and entertainment while spending in the defense sector decreased by 1.5%.

As a small developed economy, Israel is highly dependent on exports and therefore sensitive to changes in the global economy. Israeli exports (excluding start-up companies and diamonds) expanded by 0.3% in the second quarter. While the rise was moderate, it nevertheless showed an improvement from the year’s first quarter when Israeli exports decreased by 0.4%.

In 2022, the British journal “The Economist” ranked Israel as the fourth best-performing economy among the OECD’s 34 member states.

However, Israeli and international experts have warned that the Netanyahu government’s current judicial overhaul is harming the Israeli economy.

In July, the CEOs of Israel’s leading banks warned of negative consequences for the Israeli economy.

"The investors we are speaking to in recent months are very concerned about the unilateral moves and their concern, and of course ours, from the divide in the nation, is causing them to stop investments and cause damage that could be irreversible and destructive to Israel's economy," stated Bank Leumi CEO Hanan Friedman.

The All Israel News Staff is a team of journalists in Israel.

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