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Israel vs. Lebanon

Economy

IsraelLebanon
Economy - overview"Israel has a technologically advanced free market economy. Cut diamonds, high-technology equipment, and pharmaceuticals are among its leading exports. Its major imports include crude oil, grains, raw materials, and military equipment. Israel usually posts sizable trade deficits, which are offset by tourism and other service exports, as well as significant foreign investment inflows.

Between 2004 and 2013, growth averaged nearly 5% per year, led by exports. The global financial crisis of 2008-09 spurred a brief recession in Israel, but the country entered the crisis with solid fundamentals, following years of prudent fiscal policy and a resilient banking sector. Israel's economy also weathered the 2011 Arab Spring because strong trade ties outside the Middle East insulated the economy from spillover effects.

Slowing domestic and international demand and decreased investment resulting from Israel’s uncertain security situation reduced GDP growth to an average of roughly 2.8% per year during the period 2014-17. Natural gas fields discovered off Israel's coast since 2009 have brightened Israel's energy security outlook. The Tamar and Leviathan fields were some of the world's largest offshore natural gas finds in the last decade. Political and regulatory issues have delayed the development of the massive Leviathan field, but production from Tamar provided a 0.8% boost to Israel's GDP in 2013 and a 0.3% boost in 2014. One of the most carbon intense OECD countries, Israel generates about 57% of its power from coal and only 2.6% from renewable sources.

Income inequality and high housing and commodity prices continue to be a concern for many Israelis. Israel's income inequality and poverty rates are among the highest of OECD countries, and there is a broad perception among the public that a small number of ""tycoons"" have a cartel-like grip over the major parts of the economy. Government officials have called for reforms to boost the housing supply and to increase competition in the banking sector to address these public grievances. Despite calls for reforms, the restricted housing supply continues to impact the well-being of younger Israelis seeking to purchase homes. Tariffs and non-tariff barriers, coupled with guaranteed prices and customs tariffs for farmers kept food prices high in 2016. Private consumption is expected to drive growth through 2018 with consumers benefitting from low inflation and a strong currency.

In the long term, Israel faces structural issues, including low labor participation rates for its fastest growing social segments - the ultraorthodox and Arab-Israeli communities. Also, Israel's progressive, globally competitive, knowledge-based technology sector employs only about 8% of the workforce, with the rest mostly employed in manufacturing and services - sectors which face downward wage pressures from global competition. Expenditures on educational institutions remain low compared to most other OECD countries with similar GDP per capita.
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Lebanon has a free-market economy and a strong laissez-faire commercial tradition. The government does not restrict foreign investment; however, the investment climate suffers from red tape, corruption, arbitrary licensing decisions, complex customs procedures, high taxes, tariffs, and fees, archaic legislation, and weak intellectual property rights. The Lebanese economy is service-oriented; main growth sectors include banking and tourism.

The 1975-90 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and derailed Lebanon's position as a Middle Eastern entrepot and banking hub. Following the civil war, Lebanon rebuilt much of its war-torn physical and financial infrastructure by borrowing heavily, mostly from domestic banks, which saddled the government with a huge debt burden. Pledges of economic and financial reforms made at separate international donor conferences during the 2000s have mostly gone unfulfilled, including those made during the Paris III Donor Conference in 2007, following the July 2006 war.

Spillover from the Syrian conflict, including the influx of more than 1.1 million registered Syrian refugees, has increased internal tension and slowed economic growth to the 1-2% range in 2011-17, after four years of averaging 8% growth. Syrian refugees have increased the labor supply, but are blamed for pushing more Lebanese into unemployment. Chronic fiscal deficits have increased Lebanon’s debt-to-GDP ratio, the third highest in the world; most of the debt is held internally by Lebanese banks. Weak economic growth limits tax revenues, while the largest government expenditures remain debt servicing, salaries for government workers, and transfers to the electricity sector. These limitations constrain other government spending, limiting its ability to invest in necessary infrastructure improvements, such as water, electricity, and transportation.
GDP (purchasing power parity)$315.6 billion (2017 est.)
$306.1 billion (2016 est.)
$294.5 billion (2015 est.)
note: data are in 2017 dollars
$87.89 billion (2017 est.)
$86.59 billion (2016 est.)
$85.73 billion (2015 est.)
note: data are in 2017 dollars
GDP - real growth rate3.1% (2017 est.)
4% (2016 est.)
2.6% (2015 est.)
1.5% (2017 est.)
1% (2016 est.)
0.8% (2015 est.)
GDP - per capita (PPP)$36,200 (2017 est.)
$35,800 (2016 est.)
$35,200 (2015 est.)
note: data are in 2017 dollars
$19,500 (2017 est.)
$19,400 (2016 est.)
$19,400 (2015 est.)
note: data are in 2017 dollars
GDP - composition by sectoragriculture: 2.3%
industry: 26.6%
services: 69.5% (2017 est.)
agriculture: 5.7%
industry: 21%
services: 73.3% (2017 est.)
Population below poverty line22%
note: Israel's poverty line is $7.30 per person per day (2014 est.)
28.6% (2004 est.)
Household income or consumption by percentage sharelowest 10%: 1.7%
highest 10%: 31.3% (2010)
lowest 10%: NA%
highest 10%: NA%
Inflation rate (consumer prices)0.2% (2017 est.)
-0.5% (2016 est.)
3.1% (2017 est.)
-0.8% (2016 est.)
Labor force4.021 million (2017 est.)
2.166 million
note: excludes as many as 1 million foreign workers and refugees (2016 est.)
Labor force - by occupationagriculture: 1.1%
industry: 17.3%
services: 81.6% (2015)
agriculture: NA%
industry: NA%
services: NA%
Unemployment rate4.3% (2017 est.)
4.8% (2016 est.)
NA%
Budgetrevenues: $92.82 billion
expenditures: $102.1 billion (2017 est.)
revenues: $10.9 billion
expenditures: $15.99 billion (2017 est.)
Industrieshigh-technology products (including aviation, communications, computer-aided design and manufactures, medical electronics, fiber optics), wood and paper products, potash and phosphates, food, beverages, and tobacco, caustic soda, cement, pharmaceuticals, construction, metal products, chemical products, plastics, cut diamonds, textiles, footwear
banking, tourism, food processing, wine, jewelry, cement, textiles, mineral and chemical products, wood and furniture products, oil refining, metal fabricating
Industrial production growth rate4% (2017 est.)
2.1% (2017 est.)
Agriculture - productscitrus, vegetables, cotton; beef, poultry, dairy products
citrus, grapes, tomatoes, apples, vegetables, potatoes, olives, tobacco; sheep, goats
Exports$60.6 billion (2017 est.)
$56.17 billion (2016 est.)
$4.051 billion (2017 est.)
$3.689 billion (2016 est.)
Exports - commoditiesmachinery and equipment, software, cut diamonds, agricultural products, chemicals, textiles and apparel
jewelry, base metals, chemicals, consumer goods, fruit and vegetables, tobacco, construction minerals, electric power machinery and switchgear, textile fibers, paper
Exports - partnersUS 29.3%, Hong Kong 7.4%, UK 6.5%, China 5.5%, Belgium 4.2% (2016)
South Africa 21.1%, Saudi Arabia 9%, UAE 8%, Syria 6.7%, Iraq 5.4% (2016)
Imports$66.76 billion (2017 est.)
$63.54 billion (2016 est.)
$18.05 billion (2017 est.)
$17.33 billion (2016 est.)
Imports - commoditiesraw materials, military equipment, investment goods, rough diamonds, fuels, grain, consumer goods
petroleum products, cars, medicinal products, clothing, meat and live animals, consumer goods, paper, textile fabrics, tobacco, electrical machinery and equipment, chemicals
Imports - partnersUS 12.2%, China 8.9%, Switzerland 6.4%, Germany 6.1%, Belgium 5.9%, UK 5.5%, Netherlands 4.1%, Italy 4% (2016)
China 11.2%, Italy 7.5%, US 6.3%, Germany 6.2%, Greece 5.7%, Egypt 4.1% (2016)
Debt - external$93.02 billion (31 December 2017 est.)
$87.96 billion (31 December 2016 est.)
$39.46 billion (31 December 2017 est.)
$36.6 billion (31 December 2016 est.)
Exchange ratesnew Israeli shekels (ILS) per US dollar -
3.606 (2017 est.)
3.8406 (2016 est.)
3.8406 (2015 est.)
3.8869 (2014 est.)
3.5779 (2013 est.)
Lebanese pounds (LBP) per US dollar -
1,507.5 (2017 est.)
1,507.5 (2016 est.)
1,507.5 (2015 est.)
1,507.5 (2014 est.)
1,507.5 (2013 est.)
Fiscal yearcalendar year
calendar year
Public debt59.5% of GDP (2017 est.)
60.7% of GDP (2016 est.)
142.2% of GDP (2017 est.)
146.6% of GDP (2016 est.)
note: data cover central government debt, and exclude debt instruments issued (or owned) by government entities other than the treasury; the data include treasury debt held by foreign entities; the data include debt issued by subnational entities, as well as intra-governmental debt; intra-governmental debt consists of treasury borrowings from surpluses in the social funds, such as for retirement, medical care, and unemployment
Reserves of foreign exchange and gold$113 billion (31 December 2017 est.)
$95.45 billion (31 December 2016 est.)
$53.1 billion (31 December 2017 est.)
$54.04 billion (31 December 2016 est.)
Current Account Balance$14.28 billion (2017 est.)
$11.57 billion (2016 est.)
-$9.488 billion (2017 est.)
-$9.382 billion (2016 est.)
GDP (official exchange rate)$348 billion (2016 est.)
$52.7 billion (2016 est.)
Stock of direct foreign investment - at home$119.4 billion (31 December 2017 est.)
$107.3 billion (31 December 2016 est.)
$NA
Stock of direct foreign investment - abroad$106.9 billion (31 December 2017 est.)
$98.11 billion (31 December 2016 est.)
$NA
Market value of publicly traded shares$243.9 billion (31 December 2015 est.)
$200.5 billion (31 December 2014 est.)
$203.3 billion (31 December 2013 est.)
$11.22 billion (30 December 2014 est.)
$10.54 billion (30 December 2013 est.)
$10.42 billion (28 December 2012 est.)
Central bank discount rate0.1% (15 December 2015)
0.25% (31 December 2014)
3.5% (31 December 2010)
10% (31 December 2009)
Commercial bank prime lending rate3.3% (31 December 2017 est.)
3.42% (31 December 2016 est.)
8.6% (31 December 2017 est.)
8.35% (31 December 2016 est.)
Stock of domestic credit$280.8 billion (31 December 2017 est.)
$257.5 billion (31 December 2016 est.)
$112.2 billion (31 December 2017 est.)
$104 billion (31 December 2016 est.)
Stock of narrow money$98.28 billion (31 December 2017 est.)
$79.58 billion (31 December 2016 est.)
$7.366 billion (31 December 2017 est.)
$6.739 billion (31 December 2016 est.)
Stock of broad money$223.1 billion (31 December 2017 est.)
$189 billion (31 December 2016 est.)
$56.65 billion (31 December 2017 est.)
$54.68 billion (31 December 2016 est.)
Taxes and other revenues26.7% of GDP (2017 est.)
20.7% of GDP (2017 est.)
Budget surplus (+) or deficit (-)-2.7% of GDP (2017 est.)
-9.7% of GDP (2017 est.)
Unemployment, youth ages 15-24total: 8.6%
male: 8.2%
female: 9.1% (2016 est.)
total: 22.1%
male: 22.3%
female: 21.6% (2007 est.)
GDP - composition, by end usehousehold consumption: 55.4%
government consumption: 22%
investment in fixed capital: 20.5%
investment in inventories: 0.2%
exports of goods and services: 29.8%
imports of goods and services: -27.9% (2017 est.)
household consumption: 83.6%
government consumption: 12.8%
investment in fixed capital: 19.4%
investment in inventories: 0.5%
exports of goods and services: 26.4%
imports of goods and services: -42.7% (2017 est.)
Gross national saving24.2% of GDP (2017 est.)
24.1% of GDP (2016 est.)
24.6% of GDP (2015 est.)
3.3% of GDP (2017 est.)
4.7% of GDP (2016 est.)
2.5% of GDP (2015 est.)

Source: CIA Factbook