The Israeli economy has skyrocketed from 138th place to 29th in total exports since 1948.

‘In its 65 years, Israel has enjoyed fast growth based, among other things, on the fast and significant increase in exports,’ says Export Institute chairman.

By Avital Lahav

In its 65 years of existence, the State of Israel‘s volume of exports (goods and services) has grown 15,000 times, from some $6 million in 1948 to some $91 billion in 2012, the Israel Export and International Cooperation Institute (IEICI) reported Tuesday in honor of Independence Day.

Israeli exports – Photo: Avishag Shaar Yashuv

According to IEICI calculations, this is the sixth highest growth rate in the world during that period, putting the Israeli economy in the 38th place in terms of export volumes and 29th in terms of exports per capita, after South Korea and Britain and before France, Spain, Italy, Japan and the United States.

An analysis conducted by IEICI economists, examining the export growth rates from 1948 to 2012, ranks Israel in the sixth place in the world after the United Arab Emirates (whose volume of exports has grown 150,000 times during that period), South Korea (29,000 times), Oman (24,000 times), Qatar (24,000 times) and Taiwan (17,000 times).

Israel is followed by China, whose volume of exports grew 3,900 times since 1948, and Japan (3,000 times).

Most countries preceding Israel in terms of export growth rates are the Gulf states, thanks to an increase in oil production and in its global price. Israel ranks second among OECD countries (after South Korea) and first among European countries.

“In its 65 years of existence, Israel has reached significant export achievements and enjoyed fast growth based, among other things, on the fast and significant increase in exports,” said IEICI Chairman Ramzi Gabbay.

The figures are encouraging but hold a concerning message too. They serve as a reminder of the Israeli economy’s dependence on exports as a source of growth. This dependence means that the Israeli economy is negatively affected by a slowdown in the volume of global trade, following a financial crisis, even when the economic trends which led to the crisis did not take place in Israel.

This was the case when the real estate bubble burst in the US, leading to the bank shares crisis on Wall Street in 2008, and this is the case today when the European debt crisis is leading to significant cuts in government budgets and to an economic slowdown in European countries, which serve as the Israeli industry’s main export destination.

View original Ynet publication at: http://www.ynetnews.com/articles/0,7340,L-4369051,00.html