In a recent episode of IsraelCast, host Steven Shalowitz engaged in an illuminating discussion with Dr. Efraim Chalamish, Professor of International Economic Law at NYU, on Israel's economic landscape nine months after the October 7 terrorist attacks.
Dr. Chalamish, founder and president of the Global Center for Economic Development and Security, highlighted the unexpected strength of Israel's economy. "If you look at the economic performance and innovation, most internationals keep investing in the Israeli market, [and] invest in local production," he noted, underscoring the confidence that global investors continue to place in Israel's economic fundamentals.
Dr. Efraim Chalamish
The conversation delved into the unique challenges faced by Israeli businesses, particularly in balancing national service with professional commitments. Dr. Chalamish explained, "Many of the employees have to find the right balance between their service and day job... Being away and serving their companies at the same time." This dual commitment, he suggested, has contributed to the market's resilience.
While larger corporations have shown remarkable adaptability, the startup ecosystem has faced more significant hurdles, primarily in securing funding. However, Dr. Chalamish pointed out that adversity has sparked innovation: "Especially during times of war and post-crisis, these kinds of reality force Israeli individuals, companies, and institutions to be more creative. To do more with less."
Dr. Chalamish also addressed Israel's standing in international financial markets. Despite some credit rating downgrades, Dr. Chalamish emphasized that the impact on Israel's ability to raise capital has been minimal. "At the end of the day, the new rating didn't impact significantly the ability of Israel to raise money in public markets," he stated, noting that recent bond offerings were oversubscribed.
Regional cooperation, particularly considering the Abraham Accords, remains a crucial factor in Israel's economic outlook. Dr. Chalamish stressed the importance of these agreements, stating, "The Middle East story is much bigger than this conflict or that conflict." He highlighted ongoing collaborations in energy and other sectors as evidence of the region's economic interdependence.
Looking to the future, Dr. Chalamish expressed optimism about Israel's economic trajectory and its role in the broader Middle Eastern economy. He encouraged international engagement with Israel's market, asserting, "You have to be a part of the story... whether that be visiting or investing, there are many ways to be a part of the story from around the world."
This IsraelCast episode offers valuable insights into the resilience and adaptability of Israel's economy in the face of significant challenges. It underscores the nation's continued importance in global markets and highlights the opportunities that persist for international investment and collaboration.
As Israel navigates this complex period, the discussion with Dr. Chalamish serves as a reminder of the country's economic strength and its capacity for innovation in times of adversity. It also points to the broader implications for regional stability and cooperation, suggesting that economic ties may play a crucial role in shaping the future of the Middle East.