Today (Tuesday), the President received the Bank of Israel’s annual report from the Governor of the Bank of Israel, Prof. Amir YaronWhich is expected to address the annual report in detail at the Jerusalem Post’s London conference, to be held on March 31.
The report showed that gross domestic product grew by 8.2% in 2021 and 6.4% per capita, while in the fourth quarter of the year the GDP reached a level consistent with its growth trend before the corona crisis. The outbreak of the corona, when the broad unemployment rate dropped significantly and the number of job vacancies was high.
The report also shows that apartment prices rose by a nominal 13% this year and rents rose by 3.3%. The number of transactions increased again after falling at the beginning of the Corona crisis. “Price per occupant”, and on the part of investors due to changes in purchase tax rates applied to them. At the same time, the report indicates that land marketing has risen to a record level this year, with about 86 other housing units, after years averaging only 38,000.
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The Bank of Israel also points out that over the past year, the labor market has recovered, after being hit in connection with the outbreak of the corona plague. The recovery is reflected in an increase in the employment rate, a decrease in security, an increase in wages and even a high rate of job vacancies. Returning to employment also contributed to maintaining the relationship between employees and employers during the crisis.
Meanwhile, the report shows that technology, and in particular remote work, moderated the economic damage during the Corona period and enabled the continuation of economic activity. The importance of the high-tech sector to the Israeli economy was particularly pronounced, The rapid rise in demand for workers and the number of jobs soared. Exports from the high-tech sector continued to grow rapidly in 2021. Its share of GDP increased from 10.5% in 2019 to 12% in 2021.
Regarding the public sector and its funding, the report shows that the government deficit has fallen significantly from 11.5% of GDP in 2020 to 5.5% of GDP in 2021. The central government budget deficit has fallen from 11.4% of GDP in 2020 to 4.4% in The decline is due to a 2.3% increase in revenue and a 3.7% increase in GDP.
Prof. Yaron emphasized that “the recovery in the economy is not uniform, there are places in Israeli society that have not been able to recover from the crisis, and we must not abandon them. In an international perspective, this strong growth is also noticeable compared to other developed countries.” “From the level of the creative Israeli worker, through a dynamic business sector to the generally correct decision-making of policy makers. There was also a part in the Bank of Israel here and I am definitely proud of it.”
President Herzog said that “the Bank of Israel is a very important institution for the stability of the economy and the development of the country. The greatness of the Bank of Israel Law is in ensuring the stability and independence of a central bank in Israel. The State Bank must be independent and act in accordance with considerations laid down by law. “