Israel Politics and Economy

Israel Politics and Economy


Israel is a parliamentary republic. There is no written constitution. According to equzhou, the people elect a parliament, the Knesset. Parliament passes laws and appoints a government. It elects the president, who has no power to govern. The head of government is the prime minister.

After a long-standing government crisis under Prime Minister Netanyahu , Naftali Bennett was sworn in as prime minister by the far-right Jamina party in June 2021. Bennett organized a government majority of eight parties with the liberal Jair Lapid with the aim of replacing Netanyahu. Bennett is scheduled to hand over the post of prime minister to Lapid after two years.

Israel has occupied two areas of dense Palestinian settlement for five decades. Against objections from many Israelis and the international community, Jewish settlements were built there. Israel’s policy has been severely affected by the conflicts in and with the Palestinian Territories. Palestinian groups like Hamas in the Gaza Strip repeatedly carry out terrorist attacks against Israel, and Israel has repeatedly attacked Palestinian territories and refugee camps, most recently in March 2019. In terms of foreign policy, the US is Israel’s most important ally. A free trade agreement has existed with the European Union since 1989 and an association agreement since 2000. The relationship to the northern neighbor Lebanon is tense as Israel feels threatened by the activities of the terrorist organization Hezbollah. Israel views the developments in the civil war country Syria and the striving for supremacy of the Islamic Republic of Iran with concern.

There is general compulsory schooling for children from 6 to 16 years of age. Classes in state schools are free. Primary school lasts from 1st to 6th grade. This is followed by secondary school from 7th to 12th grade. It is divided into three-year lower and upper grades. In the upper level, students can choose between an academic, technological, agricultural or military-oriented branch. The final exam is called Bagrut. It is comparable to the German Abitur or the Austrian Matura. However, depending on the population group, there are large differences in the Abitur. The percentage of Christian students who pass the Abitur every year is 63%, higher than that of Jewish students (58%) and significantly higher than that of Muslim students (50%).

Education is very important in Israel. In addition to the general state schools, there are state-religious schools, the yeshivot, for strictly religious Jews. Here girls and boys are taught separately. Many Arab children attend non-state Arab schools. In the higher education sector, there are eight state universities – including the Tel Aviv Open University, the Technion in Haifa and the Hebrew University in Jerusalem. There are special language schools for immigrants that offer intensive courses in Hebrew. The Bezalel Academy for Art and Design in Jerusalem is the largest and most prestigious art school in the country.


Israel is an innovative high-tech country. The industry is technologically highly developed. Here, among other things, the USB stick was developed, the drip irrigation and the Intel processor. Important industrial products are semiconductors, software, aircraft, weapons, pharmaceuticals. Israel is known for its diamond cutting shops. Almost two thirds of the jewelry diamonds come from Israeli companies. The main foreign trade partners are the USA, EU countries and China. Salt is extracted from the Dead Sea. Otherwise, Israel has few natural resources and has to import large amounts of energy resources such as oil and coal. Therefore, the use of solar energy is being expanded.

Almost four fifths of the workforce work in the service sector. Many companies work in research and development. A special focus here is on medical and biotechnology. Israel is the world leader in the development of endoscopic devices. Global corporations such as Microsoft, Google and IBM have research centers in Israel. In tourism, pilgrimage to the biblical sites in the »Promised Land« plays a major role. The construction industry is achieving high growth rates, especially the expansion of the infrastructure and the energetic renovation of old buildings.

Agriculture is mainly practiced in the fertile coastal plain and in the north of the country. Even if not many people are employed in agriculture, it is important for the country’s self-sufficiency. More than half of the cultivated area has to be artificially irrigated because it does not rain enough. A large part of the agricultural land belongs to the state and is cultivated by a so-called kibbutz. There is no private property in a kibbutz and all work is done together.

Israel Politics and Economy