Israel’s Economic Dominance of the Middle East; Foreign Currency Reserves Dwarf Neighbors – Joshua Levitt
The Bank of Israel said Friday that foreign currency reserves hit a record $80.59 billion at end-November, after breaking the $80 billion threshold, for the first time, in October. In 2004, Israel held only $25 billion.
“Israel’s ability to put spare cash in the bank for emergencies very much signifies that the Israeli economy is growing, especially compared to its Arab neighbors,” said Prof. Joseph Pelzman of George Washington University and a permanent visiting professor at Ben-Gurion University. His book, Economics of the Middle East and North Africa(2012), compares Israel with its Arab neighbors in the Middle East instead of with European countries.
The comparable foreign currency reserve figures are Egypt $18.6 billion, Syria $4 billion, Lebanon $51 billion, and Jordan $12 billion. Energy exporters include Saudi Arabia with $700 billion, Libya $130 billion, Algeria $121 billion, Iraq $80 billion, and Iran $69 billion.
Israel has begun to tap its new underwater natural gas reserves. Israeli Energy Minister Silvan Shalom said that with reduced fuel imports, Israeli natural gas is already saving the country’s economy $300 million a month, a figure that could reach as high as $1 billion as more electricity generation switches to gas. “Because the gas will be much cheaper, we will cut the tariff for electricity. We will cut the tariff for water that is produced by electricity,” Shalom said.
“What the Israeli miracle shows is how a state can maintain its identity – in this case, Jewish – while embracing the best of what is available from around the modern world,” Prof. Pelzman said. “In the case of the Arab countries…in their zeal for self-preservation from any Christian influences, Muslim countries totally closed themselves off to the world’s ideas, and never thought about the consequences.” (Algemeiner)