Development of Israel's Foreign Trade in 2014
Israel's 2014 foreign trade balance registered a slight improvement, which was
reflected in an increase in exports of goods along with a more moderate increase in
imports of goods. As a result the trade deficit decreased.1
Figure no. 1: Exports and imports of goods, excluding ships, aircrafts and
diamonds excluded
Billions of US dollars, monthly data and yearly average
6
imports of
goods
5
4
exports of goods
3
2
Sources: CBS, processing by the Chief Economist division
1
All statistics are based on net foreign trade data except for the breakdown by countries
which is based on gross foreign trade. The gap between grows and net export includes
returned exports mostly of diamonds.
1
Development of Israel's Foreign Trade in 2014
Israeli exports:
Total exports of goods increased by 1.4 percent in 2014, while the total exports of
goods excluding ships, aircraft and diamonds registered a more moderate increase of
0.8 percent (see figure 1). An increase in the exports of goods derived from a 1.8
percent increase in industrial exports (totaled 81.6 percent out of total exports in
2014), and from a 1.6 percent increase in exports of diamonds (totaled 16.2 percent of
total exports in 2014).2 In contrast, agricultural exports (2.4 percent of total exports in
2014) declined by 8.5 percent.
The breakdown of industrial exports by Technological Intensity shows a 0.9 percent
decline in High- technology exports (42.6 percent of manufacturing exports, see
figure 2), due to a decline in the manufacture of computer, electronic and optical
products, a decline that was balanced by an increase in the export of pharmaceutical
products. In contrast, industrial exports of other technological levels rose in 2014.
Thus, exports of Medium-high-technology industries increased by 1.7 percent (mostly
due to an increase in the export of manufacturing equipment and machinery, despite a
decrease in the export of chemicals and its products), exports of medium-lowtechnology industries rose by 6.9 percent and exports of low technology industries
rose by 7.1 percent.
2
Approximately two third of exports of diamonds were worked on in Israel and the rest were
not.
2
Development of Israel's Foreign Trade in 2014
Figure no. 2: Industrial exports by technological intensity:
Billions of US dollars, monthly data and yearly average
High 42.6%
2.0
1.5
Medium high
36.9%
Medium low
13.8%
1.0
0.5
6.7%Low
Jan-06
May-06
Sep-06
Jan-07
May-07
Sep-07
Jan-08
May-08
Sep-08
Jan-09
May-09
Sep-09
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
May-13
Sep-13
Jan-14
May-14
Sep-14
0.0
* Percentage near each technological level indicates the percentage of its exports of total
exports excluding diamonds
Sources: CBS, processing by the Chief Economist division
Figure 3 presents the main exports industries of the Israeli market including:
"chemicals and chemical products," "manufacture of computer, electronic and optical
products,"3 "manufacture of pharmaceutical products" and "manufacture of computer,
electronic and optical products." Figure 4 presents the development of trends in these
industries' exports throughout recent years.
3
Electronic components excluded
3
Development of Israel's Foreign Trade in 2014
Figure no. 3: Main industries of industrial exports
Percentage of total industrial exports, diamonds excluded
Chemicals and
Chemical
Products
23.4%
Other
17.7%
Tranport Equipment
5.6%
Electrical
Components and
Boards
9.8%
Computer, Electronic
and Optical Products
17.0%
Machinery and
Equipment
12.6%
Pharmaceutical
Products
13.9%
Sources: CBS, processing by the Chief Economist division
Figure no. 4: Exports of computers and electronic equipment, pharmaceutical,
electrical components and chemicals
Billions of US dollars, monthly data and yearly average
1.2
Chemicals
1
0.8
Computers and
electronic equipment
0.6
Pharmaceutical
0.4
Electrical
components
0
Jan-06
May-06
Sep-06
Jan-07
May-07
Sep-07
Jan-08
May-08
Sep-08
Jan-09
May-09
Sep-09
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
May-13
Sep-13
Jan-14
May-14
Sep-14
0.2
4
Development of Israel's Foreign Trade in 2014
Sources: CBS, processing by the Chief Economist division
The breakdown of Israeli exports by countries shows that 2014 registered an increase
in exports to its main export destinations. Exports to the USA increased by 6.1
percent, exports to the EU increased by 3.2 percent, and exports to Asia increased by
4.5 percent.4 The share of exports to Asia and other countries increased in recent years
mostly at the expense of exports to the USA. The share of exports to the EU remained
relatively stable.
Figure no. 5: Export destinations by country groups
Percentage of total exports
35%
2010
30%
2011
2012
2013
2014
27.4%
26.9%
25.3%
25%
20.4%
20%
15%
10%
EU
Asia
US
Other
Sources: CBS, processing by the Chief Economist division
4
The gap between the 1.4 increase of exports and exports by country groups is due to the gap
between gross and net export, see note no. 2.
5
Development of Israel's Foreign Trade in 2014
Exports to the EU5
The EU is Israel's largest trade partner, where approximately 27 percent of Israeli
exports are destined for EU countries. Trade partners within the EU are mostly
Britain, Belgium6 , the Netherlands, Germany and France (see Figure 6). Exports to
these countries consist of 70 percent of total exports to the EU.
Figure no. 6: Main export destinations in the EU
Percentage of total Israeli exports
7%
6%
5.8%
4.8%
5%
3.6%
4%
3%
2.5%
2.4%
2%
1.7%
1.5%
1.4%
Italy
Spain
Cyprus
1%
0%
Britain
Belgium
The
Germany
Netherlands
France
Sources: CBS, processing by the Chief Economist division
5
These statistics are based on gross export data. Statistics include all export components
including exports of ships, aircraft and diamonds.
6
Belgium high rank is due to high exports of diamonds to that country.
6
Development of Israel's Foreign Trade in 2014
An analysis of the exports by industry to the EU shows that the major share of exports
consists of the manufacture of chemicals and chemical products, the manufacture of
pharmaceutical products and exports of diamonds. The rate of agriculture exports to
the EU is relatively high in comparison to its total rate (exports of agriculture to the
EU consists of 5.5 percent of Israeli exports to the EU, while the total agricultural
exports consists only 2.5 percent).
Figure no. 7: Composition of Israeli exports to the EU
Percentage of total Israeli exports to the EU7
Other
12.4%
Chemicals
22.8%
Agriculture
5.5%
Rubber and
Plastic Products
6.4%
Pharmaceutical
14.6%
Equipment and
Mechinary
20.8%
Diamonds
17.5%
Sources: CBS, processing by the Chief Economist division
7
Specific data by country and commodity are available for 2014, as of the end of January,
only until the end of September. The breakdown of the composition of the exports according
to available 2014 data results similarly.
7
Development of Israel's Foreign Trade in 2014
Figure 8 presents the level of dependency of main export industries in exports to the
EU. The table shows a high dependency in agricultural exports, plastic and
pharmaceutical products. In contrast, dependency in exports of diamonds and the
manufacture of machinery and equipment is relatively low. The weakening of the
Euro may affect the exports of these industries which are highly dependent in the EU
market.
Figure no. 8: Dependency of Israeli export industries in exports to the EU
Percentage of industry exports to the EU out of total exports of the industry8
70%
60%
50%
40%
30%
20%
10%
0%
60.2%
45.8%
44.1%
39.3%
38.1%
27.4%
22.4%
8
21.8%
16.8%
Specific data by country and commodity are available for 2014, as of the end of January,
only until the end of September. The breakdown of the composition of the exports according
to available 2014 data results similarly.
8
Development of Israel's Foreign Trade in 2014
Imports of goods
Imports of goods increased moderately by 0.5 percent, while a similar rate remains
after the exclusion of ships, aircraft and diamonds. However, with the deduction of
fuels (an industry that maintained a declining trend during 2014, see figure 9) the
increase of imports was more significant at 4.4 percent.
Figure no. 9: Imports of fuels
Billions of US dollars, monthly data and yearly average
1,500
1,000
500
0
Sources: CBS, processing by the Chief Economist division
9
Development of Israel's Foreign Trade in 2014
The breakdown by commodity groups shows that imports of most commodity groups
increased. Imports of consumer goods, imports of investment goods and imports of
raw materials increased by 9.0 percent, 4.4 percent and 2.3 percent, respectively.
Import of diamonds increased as well by 3.8 percent. In contrast, the import of fuels
fell by 9.0 percent, further to the decrease in 2013. A part of the decrease in the
import of fuels during the last months is explained by the sharp decrease in oil prices
during the second half of 2014. Table 10 presents the composition of imports during
2014.
Figure no. 10: Main commodity groups of imports
Percentage of total 2014 import
Ships, Aircrafs and
other
Diamonds
0.6%
12.0%
Investment Goods
13.0%
Raw Materials
38.9%
Consumer Goods
17.6%
Fuels
17.9%
Sources: CBS, processing by the Chief Economist division
10
Development of Israel's Foreign Trade in 2014
A significant rise in imports of consumer goods follows to the rise in 2013, and was
due to a sharp increase in imports of transport equipment. A significant increase was
also noted in imports of current consumption goods (except for medicine) and in
imports of furniture and home appliances (see figure 11).
Figure no. 11: Imports of consumer goods
Rate
of
35%
30%
25%
20%
15%
10%
5%
0%
-5%
-10%
increase:
2014
versus
2013
and
2013
versus
2012
31.4%
28.5%
2013
2014
11.7%
6.7%
2.8% 2.2%
11.7%
7.4%
7.9%
9.5%
9.5% 9.0%
2.4%
-7.3%
Total imports of non- durable goods - 7.9%
Total imports of durable goodsin 2014- 10.5%
11
8.1%
9.9%
12