The Central Bureau of Statistics is upwardly revising the economic growth rate for the first three months of 2018. According to the third revision of the growth figures, GDP grew at 4.7% in the first quarter, compared with 4.5% in the preceding revision, following 4.6% and 4.3% growth in the fourth and third quarters of 2017, respectively. Excluding net taxes on imports, GDP was up 3.4% in the first quarter.

Behind the impressive growth figures lies skyrocketing spending on private vehicles, which contributed 10% to spending on private consumption, the largest component in GDP. According to the latest revision, spending on private vehicles in the first quarter rose by an annualized 266.6% in the first quarter (a 38.4% quarterly increase), following a 25.3% annualized and 7.0% quarterly drop in the preceding quarter. Vehicle importers say that no unusual sales of vehicles took place in the period mentioned by the Central Bureau of Statistics in comparison with the first quarter of 2017.

The revised figure for growth in exports of goods and services in the first quarter of 2018 is an annualized 6.1%, following 10.0% annualized growth in the preceding quarter. Exports of services grew by an annualized 15.4% and exports of goods grew by an annualized 7.7%.

Investments in fixed assets, excluding ships and airplanes, were up by an annualized 6.3% in the first quarter, following an annualized 1.4% drop in the preceding quarter. This increase, however, includes an annualized 317.3% rise in investments in land transportation vehicles, while investments in machinery and equipment fell by 9.2%, investments in residential construction was down 16.7%, and investment in intellectual property declined by an annualized 3.1%.

Imports of goods and services jumped 20.7% in the first quarter, following a 5.5% rise in the preceding quarter. Imports of civilian goods rose by an annualized 20.9% and imports of services (including software, transportation, communications, and tourist services) increased by an annualized 11.2%.

Published by Globes [online], Israel business news - www.globes-online.com - on July 16, 2018

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