Israel's GDP rose at a seasonally adjusted annual rate of 3.4% in constant prices in the fourth quarter of 2011, the same growth rate as in the preceding quarter, the Central Bureau of Statistics reported today.
Despite fears that the slowing of Israel's GDP growth would intensify, the figures show that the growth rate was stable. GDP rose at an annual rate of 3.5% in the second half of 2011, down from over 5% in the first half.
Business product, the economy's main growth driver, rose by an annualized 4% in the second half of 2011, after rising at an annual rate of 5.8% in the first half and 6.4% in the second half of 2010. Business product growth in the second half of 2011 includes annualized 9.5% growth in the financial and business services sector, annualized 10.5% growth in the construction sector, annualized 4.4% growth in the commercial, hosting and catering sector, and annualized 2.3% drop in the manufacturing sector.
A breakdown of growth components shows 4.4% growth in public consumption in the second half of 2011 and 12.6% growth in investment in fixed assets. However, private consumption, a key growth driver, was barely changed, rising just 0.4%, and exports of goods and services fell by 2%, due to the economic crisis in Europe, a key export market, and the slowdown in the US.
Consumption trends are especially worrying. Spending on durable goods per capita, which reflects the standard of living, fell by an annualized 15.2% in the second half of 2011, after rising by 17.5% in the first half. Spending on motor vehicles per capita fell by an annualized 23.3% in the second half, after rising by 11.8% in the first half, and spending on household appliances per capita (refrigerators, clothes dryers, air conditioners, etc.) fell by 15.6%, after rising over 40%.
Published by Globes [online], Israel business news - www.globes-online.com - on April 16, 2012
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