Israel Ranks 32nd in per Capita GDP

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Israeli Prime Minister Benjamin Netanyahu delivers a speech during the Presidents Conference of Major American Jewish organizations in Jerusalem, earlier this week. Credit: AFP

In 2005, when he was Israel’s finance minister, Prime Minister Benjamin Netanyahu declared that the goal of the Finance Ministry while he was at the helm would be to propel Israel within a period of 10 years into the ranks of the top 10 countries in the world as measured by standard of living. He made the statement at a news conference on May 10, 2005, explaining that the goal would be to put Israel in the top-10 ranking measured by the country’s per capita gross domestic product. The address came to be dubbed the “10-year speech.”

In fairness, Netanyahu has not been in power for the entire 10 years, and nor has his Likud party, but with three months to go until the 10-year mark, Israel is currently ranked 32nd in the world as measured by per capita gross domestic product, according to data from the International Monetary Fund. That is three spots above where the country was in 2005. (The data is based on Israeli citizen’s parity purchasing power, which is an accepted measure for purposes of international comparisons that offsets differences in the cost of living).

At the time of the 2005 news conference, Netanyahu said that to reach the goal, the Israeli economy would have to grow at an average annual rate of 4.5% at least, which he said would “improve the situation of all of Israel’s citizens and considerably reduce the incidence of poverty.” He was committed, he said, to enacting dozens of reforms that would make such growth possible, but he ended up resigning as finance minister three months later in protest over then-Prime Minister Ariel Sharon’s plan to carry out a withdrawal from the Gaza Strip, which was in fact done later the same year. Netanyahu returned to government as prime minister in 2009.

In 2014, according to the IMF, Israel’s per capita GDP was $33,300, compared to $24,100 in 2005. That ranks the country just above Spain and just below Italy, New Zealand and South Korea. Preliminary figures from the Central Bureau of Statistics indicate that last year, Israel’s per capita GDP grew at a rate of 0.9%. During the period from 2003 to 2014, the year of the highest growth was 2007, when it was 4.4%.

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