The International Monetary Fund (IMF) has upgraded its forecasts for growth in Israel's economy to 5% in the year 2021, according to a report published on Tuesday.
In its World Economic Outlook, the forecast the IMF presented was almost a whole percent higher than its January forecast which stood at 4.1%.
These figures are a sign of Israel's strong recovery from the COVID-19 pandemic which saw Israel's economy contract by 2.3% — one of the lowest such figures among western economies and a far cry from the mammoth 6% contraction the IMF predicted late last year.
The Israeli economy is expected to grow by another 4.3% in 2022.
The organization also said it expects the global economy to grow by 6% in 2021, up from its 5.5% forecast in January and 5.2% in fall 2020. Looking further ahead, global GDP for 2022 is seen increasing by 4.4%, higher than an earlier estimate of 4.2%.
IMF economists have also determined that Israel's unemployment rate in 2021 will drop to 5%, down from 5.6% it predicted at the beginning of the year and similar to the figures the country's Central Bureau of Statistics released last month. The fund also predicts that the unemployment rate would further dip to 4.6% in 2022.
These numbers only account for around 200,000 Israelis who are out of work and excludes don’t take into account another 400,000 citizens placed on unpaid leave.
Finance Minister Israel Katz called the increase in projected growth "important news and another vote of confidence in the Israeli economy and its stability, which has been maintained, among other things, thanks to the comprehensive economic assistance provided during the coronavirus crisis, along with maintaining budgetary stability."