What can we learn from Israel
With just 72 years of existence, the State of Israel has accomplished the impossible: create a prosperous democracy while being surrounded by countries who actively seek its destructions, while also constructing one of the most developed economies in the world, despite the fact the small piece of land is purely a desert. So how did Israel achieve such an “economic miracle”?
According to New York Times´ best-selling authors Dan Senor and Saul Singer, its secret doesn’t rely in the entrepreneurial spirit of the jewish man and woman, but rather in the experiences forged by the compulsory military service, the effective imigration policies carried through since its creation, and the prime essence of the israeli culture, which has been forged through decades of adversity that has given the israeli people an innovative spirit.
But Israel´s success is far beyond big words; its accomplishments in a seven-decade span are mind blowing for a country with vast natural resources and constant peace. For a country with no natural resources, and a constant state of war (like Israel) its accomplishments are miraculous.
For instance, Israel has more companies listed in the NASDAQ (the tech-heavy wall street index) than South Korea, Japan, Singapore, China, India and Europe, per Singer and Senor. Up until 2009, Israel had 63 companies listed in the NASDAQ index, a result that both authors recognize as part of Israel´s extensive investments in Research & Development (R+D), which in the period 2000–05 represented 4.5% of GDP, a larger number than Japan (3.2% of GDP), USA (2.7% of GDP) and China (1.4% of GDP) for the same period. Evenmore, Israel has not only achieved such a level of economic prosperity, but it has also been tremendously inclusive; according to the 2020 Mastercard Index of Women Entrepreneurs (MIWE) Israel ranks as the best country for female entrepreneurs, in part thanks to its active policies of funding and networking such initiatives, and in part because of the major role that the country has given women in its efforts to consolidate itself as a prosperous nation.
In the annual Human Development Index report published by the UN in 2019, considered by most economists as one of the most effective tools in measuring economic development as it combines GNI per capita, mean years of schooling and life expectancy, Israel ranked 22nd out of 189 countries, with a nominal score of 0.906 (the maximum value is 1, the minimum value is 0), ahead of countries such as South Korea, France and Italy.
Israel is also home to major technological developments such as the pendrive, Wix and Waze, and is a revolutionary pioneer in technological agriculture with inventions such as Netafim, a desert-friendly irrigation system that self-regulates the amount of water a tree needs according to its size, improving yield crops by 70% in the Arava desert and reducing water usage by 5%, and is now present in 110 countries around the globe. Finally, amongst its accomplishments in technology, medicine and agriculture, Israel is also one the only twelve countries with satellites in space, making the 420km large country a pioneer in aerospace engineering.
Talent is an important factor in understanding Israel’s major success, but so are its friendly inmigration policies, and so are Israel´s active policies in stimulating scientific and technological education. For instance, Israel has 140 scientists, engineers and technicians per 10,000 employees, whereas the US has 85. But there is a secret, harder-to-measure factor that can explain Israel’s success, and it relies on its culture. It relies on the willingness and intrinsic motivation of its 8.8 million people to make Israel prosperous and to prevent, at all costs, the extermination of the country that its enemies have purposefully seeked for decades.
Much can be learnt from Israel, from its already mentioned revolutionary developments in major areas, and its prosperous economy. However, the biggest treasure that can be expropriated from Israel is that anything can be achieved, despite the surreal and seemingly impossible circumstances in which a country can be immersed in. Motivation, ambition and collective work are the biggest drivers of prosperity, and Israel is a vivid example of it. The world would benefit tremendously from imitating this nation, at least in some elements; either way, the story of Israel has just started.
Sources:
- Senor, Dan and Singer, Saul (2009). Start-up Nation: The Story of Israel’s economic miracle.
- Human Development Index 2019, United Nations.
- (2020) “Mastercard ranks Israel as best country for female entrepreneurs”, The Times of Israel.
