The Israeli economy grew in the third quarter of 2022 at a rate of 2.1%, according to the GDP (gross domestic product) data published by the Central Bureau of Statistics. This is a continuation of growth after 7.3% in the previous quarter. This is another positive figure that keeps the Israeli economy out of recession, after A decrease of 3.4% in the first quarter of the year.
However, it should be remembered – a significant part of the increase in GDP in the current quarter is due to an increase in spending on public consumption, that is, government spending. In practice, this is a very easy way to increase GDP. Unlike the private sector, where the public’s income (contribution) to the economy is counted, the government does not Such a way and that’s why the expenses are actually counted. The problem is that you can simply spend more money and it will be considered ‘growth.’ This is a known problem with the way of measuring the GDP estimate, but currently this is the way GDP is measured in the world.
Compared to last year, GDP increased by 5.8%, spending on private consumption increased by 5.6% and spending on public consumption increased by 1.6%. Here we are talking about more “real” growth since public spending increased less and despite this the GDP increased nicely.
Also in the data, business GDP increased by 0.9%, GDP without taxes on imports increased by 2.3%. There was a 13% increase in investment in fixed assets, a 3.8% increase in the export of goods and services and a 4.8% increase in the import of goods and services.
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