By Naomi Miller
Despite entering the third year of the global pandemic, it seems that 2022 is looking quite positive for Israel, albeit with some challenges.
Over the last 12 months Israeli tech IPOs, as well as mergers and acquisitions, jumped a massive 520% over the previous year, with an unprecedented value of $81.2 billion, compared to $15.4 billion in 2020. In addition, 2021 was a record year for funding tech companies and startups, reaching $25 billion in investments. Analysts are identifying this massive growth partly as a result of the development of a new business culture. Today, the maturing Israeli entrepreneur is aiming to build a strong local company and take it public, rather than developing technology and then selling it, which was the model of the last two decades. This massive growth will be challenged in the coming year by the current shortage of approximately 13,000 skilled workers in the tech sector.
Climate change is starting to get serious attention. Israel’s Energy Minister Karine Elharrar has announced that 2022 will be the year of renewable energy. Her ministry will be setting up, for the first time, a department with funds of $320 million that will invest in a national plan for researching and developing clean energy. As a result, the Minister said, “gas can wait,” and will halt the search for natural gas off the Mediterranean coast in order to pursue and optimize renewable energy projects.
The last decade has seen young Israeli families discovering that home ownership is almost unattainable. Housing prices have been rising continually, and 2021 witnessed the highest rise in a decade, at 10.3%. According to the Alrov Institute for Real Estate, an average Israeli couple would both need to work 27 years to buy a standard 4-room apartment. The good news is the Bennett government has recently developed a 4-year plan from 2022 to increase the supply of housing and ultimately reduce prices, with the aim to narrow the gap between supply and demand by 2025.
I hoped we would not be writing about Covid -19 by now, but here we are in that familiar scenario. Israel is currently closed to tourism while waiting to see what the new Omicron variant has in store for us. The good news: Israeli biotech company Bonus BioGroup has developed a cell therapy for treatment of severe cases of Covid. The recent trial had a 94% success rate, with 47 or the 50 patients surviving conditions of life-threatening respiratory distress.
Although closed off to the world, the Israeli economy is open and vibrant and Covid rates remain low. We hope 2022 will be the year of renewed tourism and that we will see you here soon.