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Israel
Chamber of Commerce Country Factsheet Last update: 03.08.2017

Your advisors at the Chamber of Commerce

  • Edith Stein
    +352423939482
  • Daniel Sahr
    +352423939313
Contact us: middleeast@cc.lu

Key Indicators

Area
20,770 km2
Population
8,174,527(July 2016 est.)
Government type
parliamentary democracy
Languages
Hebrew (official), Arabic (used officially for Arab minority), English (most commonly used foreign language)
GDP
$297 billion (2016 est.)
Growth rate
2.8% (2016 est.)
HDI
18
Capital
Jerusalem

 

Introduction

Following World War II, Britain withdrew from its mandate of Palestine, and the UN proposed partitioning the area into Arab and Jewish states, an arrangement rejected by the Arabs. Nonetheless, an Israeli state was declared in 1948, and Israel subsequently defeated the Arab armies in a series of wars that did not end deep tensions between the two sides. (The territories Israel has occupied since the 1967 war are not included in the Israel country profile, unless otherwise noted.) On 25 April 1982, Israel withdrew from the Sinai Peninsula pursuant to the 1979 Israel-Egypt Peace Treaty. In keeping with the framework established at the Madrid Conference in October 1991, Israel conducted bilateral negotiations with Palestinian representatives and Syria to achieve a permanent settlement with each. Israel and Palestinian officials on 13 September 1993 signed a Declaration of Principles (also known as the "Oslo Accords"), enshrining the idea of a two-state solution to their conflict and guiding an interim period of Palestinian self-rule. The parties achieved six additional significant interim agreements between 1994 and 1999 aimed at creating the conditions for a two-state solution, but most were never fully realized. Outstanding territorial and other disputes with Jordan were resolved in the 26 October 1994 Israel-Jordan Peace Treaty.

Progress toward a final status agreement with the Palestinians was undermined by Israeli-Palestinian violence between 2001 and February 2005. Israel in 2005 unilaterally disengaged from the Gaza Strip, evacuating settlers and its military while retaining control over most points of entry into the Gaza Strip. The election of HAMAS to head the Palestinian Legislative Council in 2006 temporarily froze relations between Israel and the Palestinian Authority (PA). Israel engaged in a 34-day conflict with Hizballah in Lebanon from July-August 2006 and a 23-day conflict with HAMAS in the Gaza Strip from December 2008-January 2009. In November 2012, Israel engaged in a seven-day conflict with HAMAS in the Gaza Strip. Direct talks with the Palestinians most recently launched in July 2013 but were suspended in April 2014. The talks represented the fourth concerted effort to resolve final status issues between the sides since they were first discussed at Camp David in 2000. Three months later HAMAS and other militant groups launched rockets into Israel, which led to a 51-day conflict between Israel and militants in Gaza.

Source: The CIA World Factbook - Israel

 

Macroeconomic indicators

After picking up to 4% in 2016, growth is projected to be around 3¼ per cent in 2017-18. Inflation is projected to firm up gradually. The maintenance of expansionary monetary and fiscal policies and projected wage increases will continue to shore up domestic demand.


As inflation increases, the central bank is projected to gradually withdraw monetary stimulus. Despite having abated somewhat, ongoing tensions in the property market continue to require the authorities' attention to preserve a robust banking sector. With the economy at full employment, the budgetary expansion projected in 2017 could increase labour market tensions and slow the decline in government debt. Measures taken or announced in welfare, housing and transport should promote more inclusive growth.


Continued product market reforms are needed to stimulate productivity and pay in the sheltered sector where many of the lowest-skilled workers are employed. Increased external competition, especially in the agricultural and food sectors, would reduce the cost of living. Less restrictive import procedures, with lower non-tariff barriers, would deepen integration into global value chains, which is relatively limited. To ensure a better sharing of the benefits of this integration, a more effective education system, facilitating the integration of disadvantaged groups, would be desirable.

Source: OECD - Economic Forecast

IMF Statistics:

Subject descriptor20142015201620172018
Gross domestic product, constant prices
Percent change
3.1632.5082.7822.9622.915
Gross domestic product, current prices
U.S. dollars (Billions)
308.767299.413311.739327.630341.978
Gross domestic product per capita, current prices
U.S. dollars (Units)
37,599.21235,743.46136,556.91937,778.16438,811.572
Inflation, average consumer prices
Percent change
0.476-0.600-0.5750.7951.636
Volume of imports of goods and services
Percent change
3.845-0.5016.1251.2593.800
Volume of exports of goods and services
Percent change
1.429-4.3001.9252.1743.500
Unemployment rate
Percent of total labor force
5.9505.2255.2425.2425.242
Current account balance
U.S. dollars (Billions)
12.47913.8869.5419.5248.759
Current account balance
Percent of GDP
4.0414.6383.0612.9072.561
Colored cells are estimates

Source: IMF Statistics - Israel

 

Luxembourg and the country

Existing conventions and agreements

Non double taxation agreement 

In order to promote international economic and financial relations in the interest of the Grand Duchy of Luxembourg, the Luxembourg government negotiates bilateral agreements for the avoidance of double taxation and prevent fiscal evasion with respect to Taxes on Income and on fortune with third countries.

- Convention from 12.13.2004 (Memorial 2006, A, no. 81, p. And 1446)
- Effective as of 05.22.2006 (Memorial 2006, A, no. 150, p. 2668)

Air Services agreement

- Agreement from 06.14.1994 (Memorial 1995, A, p. 1646)
- Effective as of 20.11.1995 (Memorial 1995, A, p. 2566)

Source: Administration des contributions directes

 

Further information

Foreign Trade

The Statec Foreign Trade statistics provide information on the trade of goods - by product and by country. This information is collected respectively through the INTRASTAT declaration and on the basis of customs documents.

You can see the statistics on the website of the Statec.

Contact points in Israel

Luxembourg Trade and Investment Office

Ltd. Guinevere.
113 St. Hashmonaim
Tel Aviv 67133

Tel: +972 3 6225 445
Fax: +972 3 6225 448

E-mail: itai(at)gnv-group.com

Web: www.investinluxembourg.co.il

Source: Ministry of Foreign Affairs of Luxembourg        

Economic and Commercial Attaché (AWEX):

Gino AL 

Sason Hogi Tower
Abba Hillel Street, 12
52506 Ramat-Gan

Tel: +972 3 613 81 62
Fax: +972 3 613 81 69
E-mail: belgianexports(at)bezeqint.net

Honorary Consul

Honorary Consul with jurisdiction in Israel: Mr. Miron Chaim IZAKSON

119, Rothschild Boulevard
IL-65271 Tel-Aviv
Tel: +972 3 68 55 092
Fax: +972 3 68 55 095
Email: management(at)amina.co.il

 

Country risk as defined by Office du Ducroire for Israel

Ducroire is the only credit insurer covering open account deals in over 200 countries. A rating on a scale from 1 to 7 shows the intensity of the political risk. Category 1 comprises countries with the lowest political risk and category 7 countries with the highest. Macroeconomics experts also assess the repayment climate for all buyers in a country.

Link: Ducroire Office - Country Risk for Israel

Luxembourg for Business market entry guide to Israel: Market entry guides are brochure series published by the Ministry of the Economy and Foreign. The series focuses on worldwide markets, industries and business environments, providing comprehensive and in-depth analysis and guidelines. The brochures cover all aspects relating to a market entry including the economic, financial and legal frameworks. The brochures are a vast knowledge pool, compiled into a practice oriented document with many tips and important addresses.

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