OECD published an optimistic forecast: GDP will grow 4.5% this year and 5% in 2022n 2022

The OECD has published an optimistic forecast according to which the Israeli economy is expected to grow by 5% this year, and by 4.5% in 2022. Although current growth forecasts for the global economy (5.8%) and the countries of the organization (6.3%) are higher than for Israel, it is worth considering two additional data: The decline in Israel's GDP as a result of the corona crisis was lower than in the world and the West Of 3.5% and 4.8% respectively), but the expected growth rate next year is higher in Israel than in the rest of the world and the Western world (as mentioned, an increase of 4.5% in GDP in Israel, compared to growth of 4.4% and 3.8% in the world and the Western world respectively).
In addition, in the latest global forecast published by the OECD last December, it was estimated that the Israeli economy would grow by 2.3% in 2021, meaning that the growth forecast had doubled within six months.
The reason for this is clear and detailed in the report: “Thanks to a very high rate of immunization and the opening of the economy since mid-February, the Israeli economy is expected to grow strongly. The removal of supply constraints, the release of 'occupied demand', the withdrawal of surplus savings accumulated during 2020 and the gradual improvement in the labor market support strong growth in private consumption. "Both investment and exports are expected to strengthen as uncertainty dissipates and vaccines advance around the world, while exports of high-tech services continue to grow strongly," according to OECD economists.
The OECD's forecasts show that although private consumption was due to the Achilles' heel of the Israeli economy in 2020 (it fell at an unprecedented rate of 9.5% last year), it is the one that is expected to bounce back the Israeli economy, as it has during the past decade.
According to the organization's economists, after such a dramatic decline in 2020, private consumption in Israel is expected to soar both this year (6.5%) and next year (6.5%). The average private consumption forecast for all the countries of the organization is 5.5% in 2021 and 4.75% in 2022.
In addition, according to the report, although the OECD is concerned about raising the head of inflation worldwide, the inflation forecast in Israel implies that the organization's economists do not attribute this risk to the Israeli economy. The inflation forecast for Israel for the next two years is 1%. The price stability target set by the government.
Also, although the general report (on the world economy and the Western economies in particular) is still about a partial recovery and disruptions in international trade, the forecast of Israel's current account (Israel's dollar account, which describes the entry and exit of foreign exchange for exports of goods, services and capital And foreign investment into Israel) stands at a surplus of over 4% of GDP in the next two years - a very high rate.
The OECD is based on the fact that the next government will be able to handle the replica deficit and they predict that it will gradually fall from 12.1% of GDP in the past year (much larger than the OECD average), to a level of 8.2% and 6.2% of GDP in the next two years.
Despite the positive points, according to the OECD continued growth still depends on a number of steps. The organization's recommendations: "Approve a state budget for 2021 and prepare a fiscal strategy that includes policies that strengthen recovery and make growth more inclusive, egalitarian and greener. The same policies must include investment in education, vocational training, job search engines, public transport and environmentally friendly infrastructure."
The same forecast, which still describes the path of rising government debt, is conditional on the assumption that "there is a decrease in the budget support provided during the forecast period (2021 - AP), compared to 2020 when the emergency measures taken then are canceled", and also on the assumption that "support policy is made More and more focused. "