​Sumary:

  • A considerable improvement was recorded in the balance-of-payments current account during 2009. The current-account surplus amounted to 3.7 percent of GDP compared with 1 percent in 2008. This was because imports fell more than exports at the time of the global crisis.  
  • During the crisis Israel's exports fell by 40 percent, annual rate, and have since shown a rebound. In the last quarter of 2009 they reached 90 percent of their pre-crisis level.  
  • The OECD country's trade was more hard hit than Israeli exports. The differing developments between Israel and the developed countries can be attributed to the differing composition of Israel's and those countries' exports, and especially the high proportion of service exports from Israel: tourism services (5 percent of total exports), transportation services (6 percent of total exports), and R&D and computer services (8 percent of total exports).  
  • Sixty percent of Israeli exports are channeled via multinational firms, and a significant share of this is exports of services and intermediate goods, which helped to moderate the impact of the crisis.  
  • The growth in the current account surplus during the last two decades was supported by the development of the economy's fundamentals: a reduced rate of increase in the population, a rise in per capita GDP, a growth in the country's asset balance, and a decrease in the public sector deficit.  
  • Incoming and outgoing direct investments in Israel decreased more heavily than worldwide.  
  • Institutional investors' overseas portfolio holdings continued to increase despite the global crisis, and in accordance with the long-term trend. Foreign investors' portfolios investments in Israel showed a rebound in the second half of the year, after plummeting at the time of the crisis.  
  • The Bank of Israel's foreign exchange reserves rose during the past two years concurrent with a growth in capital imports to the economy in the "other investments" item, principally Israeli banks' capital imports.  
  • The surplus of liabilities over assets abroad increased during the year due to the upsurge in the value of shares and bonds held by foreign investors in Israel.  
     
     The Balance of Payments - Full File