Israeli economic growth hindered by low productivity, high income inequality

Source: Xinhua| 2019-07-15 17:47:02|Editor: Lu Hui
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JERUSALEM, July 15 (Xinhua) -- The Israeli economy has been hindered by low labor productivity growth and a wide income gap, Israeli media cited a report of the Organization for Economic Co-operation and Development (OECD) as saying on Monday.

Gross Domestic Product (GDP) per capita in Israel grew annually by 1.7 percent on average between 2012 and 2018, down 0.6 percentage point compared with the data between 2002 and 2008, according to OECD's "Going for Growth 2019" report.

"Enhancing skills of and employment opportunities for disadvantaged groups, better transportation infrastructure and further product market reforms and boosting productivity are crucial for making growth stronger and more inclusive," according to the Jerusalem Post citing the report.

Income distribution inequality in the country remains higher than most advanced economies of OECD. According to the group's Gini index, which measures the income distribution of economies, Israeli inequality is 34.4, higher than the overall OECD median of 31.7.

The Paris-based organization suggested that Israel should improve education for disadvantaged groups, enhance product market competition, and reduce business bureaucracy among others to boost economic growth.

The annual OECD report, issued on Friday, presents the top structural reform priorities that some 46 economies should focus on to achieve stronger and more sustainable growth.