Israel’s Gross Domestic Product (GDP) grew at an annualized rate of 6.8% in the second quarter of 2022, according to figures from the Central Bureau of Statistics released today. This follows a 2.7% decline in GDP on an annual basis in the first quarter. The second quarter growth statistic is the same as the Central Bureau of Statistics’ intimal estimate published a month ago.
In an international comparison with thirteen advanced countries attached to the Central Bureau of Statistics’ release, Israel has the highest economic growth in comparison with the corresponding quarter of 2021. In that period, Israel’s GDP jumped 7.4%, which compares with 6.2% in Austria, 5.4% in the Netherlands, 4.1% in Sweden, 3% in South Korea, and just 1.7% in Germany and the US.
By way of explanation of the positive figures, the Central Bureau of Statistics cites "the return to routine in the second quarter, which led to the rise in GDP, with the hospitality and air travel services in the private consumption category, and incoming tourism in the exports category, contributing significantly to the rise in GDP in this quarter."
Another possible explanation is inflation. Price rises across the board, from food to energy, did not make Israelis consume less, making the GDP numbers grow even more.
Support for that explanation can be found in the private consumption figure, which rose by an annualized 10.7% in the second quarter. Israelis spent 4.3% more in the second quarter on fuel, power, and housing than in the previous quarter.
Public spending rose by an annualized 4.4% in the second quarter. The increase would have been greater were it not for an annualized 20.8% drop in defense spending.
Published by Globes, Israel business news - en.globes.co.il - on September 18, 2022.
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