Israel Population and Economy 1983

By | December 22, 2021

Population. РAccording to the census of June 4, 1983, the population of Israel (within the armistice lines of 1949, but including East Jerusalem and the 23,789 Israelis residing in the administered territories) was 4,013,831 residents, of which 83% Jews, 13% Muslims, 2.3% Christians and 1.6% Druze. Of the population estimated at the beginning of 1990 (4,821,700 people, of which 82% Jews), 92% was classified as urban, that is, residing in centers with over two thousand residents. The annual growth coefficient was 1.7% between 1984 and 1989; the birth rate is 22.3% among Jews (1990), against 37.3% for Muslims, who are however affected by a much higher infant mortality rate. The increase in the Jewish population continues to depend mainly on immigration, that in the first half of the Eighties it was between 10,000 and 18,000 units per year, thanks also to the massive transfer of Jews from Ethiopia (Falascià); the hopes of large-scale population are placed in the resumption of arrivals from the Soviet Union, which should bring to Israel (and the occupied territories) over half a million Jews by the mid-1990s: in 1990 immigrants from the former Union Soviet were 185,000.

The active population (1,649,900 in 1990) is just 34% of the total, one third of which is under the age of 14. The unemployed are 10% (1990); 4.1% of the workforce is absorbed by the agro-forestry and fish sectors, 22% by mining and manufacturing, 5.1% by construction, 14.5% by commerce, 6.2% from transport and the remainder from public and private services.

Economic conditions. РAgriculture, which contributes approximately 6% to GDP, does not yet guarantee complete food self-sufficiency (the production of cereals, oils and fats is in fact lacking), but allows for a profitable export of fruit and vegetables. Overall, the primary sector is characterized by the financial difficulties encountered by cooperative (409 moshav with 146,500 residents In 1988) and collectivistic (270 kibbutz with 126,100 residents) forced more and more to engage in extra-agricultural activities. The cultivated area reached 436,000 ha in 1988-89, of which 216,000 were irrigated. Taking into account the availability of water, it is estimated that the maximum irrigable area is 530,000 ha, plus 400,000 ha potentially usable for arid crops, 850,000 ha of natural pasture and 90,000 ha available for reforestation. For Israel 2016, please check

The most important export crop is represented by citrus fruits, which however encounter growing competition on the European market from Spain and Morocco, and internal difficulties due to the abstention from work of part of the Palestinian labor force coming from the occupied territories. Spanish competition also puts floriculture in difficulty, whose production (supplied by 4500 ha of greenhouses) was absorbed for 90%, up to the first half of the 1980s, by EEC countries.

30% of the national income is provided by industry, which continues to work mainly for the domestic market, even if in 1985 industrial products (excluding diamonds) represented 91% of the total value of exports. The largest industrial complex is that of Israel Aircraft Industries, with over 20,000 employees (military and civil aircraft, missiles and other weapons), to which a rapidly expanding network of electronic industries is connected. Machined diamonds, with 27%, are the most important item among exports (1990); others include electrical and electronic machinery and equipment (21%), food, textiles, chemical and metal products. 90% of energy needs are imported, in the form of oil, from Egypt (25%), Mexico (35%) and Norway (10%).3 extracts in 1988) the search for new resources intensified; prospecting is underway off the Sinai coast. In 1988, gold minerals were identified with promising prospects at the abandoned copper mines of Timna (Negev).

In 1990, the 925 km of railways carried 2.5 million passengers and over 7 million tonnes of goods; around 800,000 private cars, 9,000 buses, 153,000 trucks and 8,700 taxis circulate on the 13,000 km of paved roads. The merchant fleet, expanding (passenger transport has been practically abandoned), includes 58 ships with a total gross tonnage of over 0.5 million tonnes. The airline El Al carried 3.4 million passengers in 1988. Foreign trade, which continues to gravitate towards Europe and the United States, is characterized by a significant deficit in the balance of payments (3.3 billion dollars in 1990), which is particularly affected by purchases of war material; since 1988 Israel enjoys preferential treatment from the EEC.

Economic and financial policy. – In the early part of the 1980s, the Israeli economy was characterized by growing imbalances. The latter have their roots, as well as in the subsequent oil price hikes that occurred during the 1970s, in the excessive development of domestic demand, fueled by persistent large public sector deficits, by the increase in defense spending and by a real wage growth higher than productivity growth. To this must be added a widespread system of indexation of financial assets and an exchange rate policy aimed at keeping purchasing power unchanged, elements that favored the sharp increase in the inflation rate. Over this period, the government deficit was more than 15% of GDP,

To address this situation, the government adopted a drastic economic stabilization program in July 1985. In addition to a tightening of fiscal policy and a significant devaluation of the exchange rate, the new program introduced a price freeze and a temporary suspension of the wage indexation mechanism at the cost of living. Following the devaluation, to achieve greater monetary stability, the shekel exchange rate was stabilized against the dollar.

The results of the program were relevant. The inflation rate fell from 374% in 1984 to 48% in 1986 and around 20% in the following years. The public deficit as a ratio of GDP, from over 15% in 1984, decreased to 1% in the following year, and even changed its sign in 1986. Moreover, the consolidation program did not have excessive costs in terms of employment; the unemployment rate, despite having risen by more than 1 percentage point between 1984 and 1986, returned to around 6% in the following two years.

This evolution reflects the strong growth recorded by the Israeli economy in 1987 (4.6%) following, above all, the considerable expansion of the industrial sector (4.4%, the highest rate since the mid-1970s).

1988 was a year of slower GDP growth, although both inflation and the current account deficit improved compared to 1987 and unemployment remained broadly stable. On the other hand, the public deficit increased sharply (around 9% of GDP) as a result of the additional expenditure due to new settlements in the occupied territories.

1989 began with a new economic program which included a commitment to reduce the public deficit by acting on both the expenditure and the revenue side. Also in 1989, an agreement was reached between the social partners to control wage dynamics, in order to contain inflation and defend the shekel (which, according to the indications of the new program, was devalued by about 13.5 %). Although the government deficit had returned to 1987 levels by the end of the year, the economic policy measures adopted failed to promote the recovery: GDP growth in 1989 slowed further, while inflation rose.

1990 was dominated by the impact of massive immigration from the USSR on the Israeli economy, which has grown at a rapid pace. The increase in public spending on assisting new immigrants has contributed to a new deterioration in the ratio of public deficit to GDP.

In 1991 the global picture did not change significantly: tensions caused by migratory flows were still the dominant element, further aggravated by the freezing for political reasons of a US loan of 10 billion dollars to meet the needs of new immigrants.

Israel Population