Palestine Economy Portal

Fears rise in Israel of an upcoming recession, after data published by the Israeli Central Bureau of Statistics showed that Israeli economic growth fell from 5% in the first quarter to 1% in the second quarter of this year. Economists at the Israeli Finance Ministry tried to explain the fall as a result of buying new cars in large quantities in the first quarter and falling significantly in the second quarter.

However, the negative growth data published by the Israeli Central Bureau of Statistics yesterday showed that the decline in growth was not only caused by the decline in the purchase of new cars, following the increase in the tax rate on "green" cars in early April. The daily Yedioth Ahronoth reported Monday that personal consumption has fallen, along with a decline in other data, and that the fear is that what is happening in the world in this context, will also occur in Israel, that is, the decline in economic activity, to the point of recession economic.

The paper pointed out that economic growth in many countries of the European Union ranges between 0% or slightly below 1%. Economists predict that this trend will intensify, and that the trend of economic winds in the world indicate a near entry into an economic recession.

The newspaper quoted experts in the Israeli Ministry of Finance expressing concern about the emerging situation, and that the decline in the rate of economic growth from 5% to 1% in three months did not occur in Israel in five years.

According to data published by the Israeli Central Bureau of Statistics yesterday, the import of goods and services, excluding security imports, ships, aircraft and jewelry, decreased by 2.5% in the second quarter, after rising in the first quarter by 9.2%.

Also, during the second quarter, personal consumption fell by 1.3%, and per capita spending decreased by 3%, which means a slight increase in the standard of living in Israel. Spending on essential products fell 66% in the annual account. Spending on car purchases fell 96%, up from 693% in the first quarter. Exports of goods and services also declined, and investment in real estate declined

The head of the Israeli Industrialists' Association, Shraga Brooch, said that "the leadership-economic absence is rapidly deteriorating the economy into recession. Industrial growth engines have almost stalled, while the government has boasted of temporary growth data and the absorption of public sector workers."

"It is clear that such data are not good, but we should not be related to one bad quarter. We have to wait and watch the whole year. The gaps between the two quarters are very large. ".

Economists said that the economic growth affected by the sale of new cars is somewhat misleading, as the auto industry in Japan, Germany and others indicates growth in those countries. Nevertheless, taxes and customs in Israel bring money into the treasury and affect Israel's growth. "But buying more German cars in one quarter and less in a second quarter is not an indicator of Israeli economic growth. Real growth should be produced here."

Arab 48