Israel Country Performance, Economic Competitiveness, Brand Image and Reputation

Israel: how does the country’s political status influence its performance in global rankings that measure talent attraction potential, public diplomacy and soft power strength, environmental sustainability and economic development? What influence have recent political developments had on the international reputation of Israel? Answers in this summary of global reports, studies and rankings on country performance, brand image and reputation.

Let’s take a closer look at:

• Ease of doing business in Israel;
• Talent competitiveness in Israel;
• Israel’s soft power and its digital demand;
• Environmental and social sustainability of Israel;
• How Israel performs as nation brand, and its reputation strength.

With thanks to our friends and knowledge partners Bloom Consulting and Brand Finance for supporting our country profiles by contributing latest research insights and benchmarking data.

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Doing business in Israel

What are the benefits of doing business in Israel?

Israel’s performance in two major indices that analyze numerous aspects of economic competitiveness shows rather contrasting tendencies. While the country has been descending in World Bank’s Ease of Doing Business Index, it has simultaneously improved its standing in the Global Competitiveness Index.

Israel’s ranking in the 2018 Ease of Doing Business index is moderate: in 2018 it positioned 54^th. While the protection of minority investors ranks fairly high (16^th) in this report, the performance of Israel’s other economic pillars is weaker. The most troublesome procedures are registering property (130^th) and paying taxes (99^th) in Israel, according to the study.

The country’s ranking has been deteriorating successively over the past decade. In 2008 it positioned 29^th, in 2013 it was already nine positions lower, and by 2016 Israel had already fallen to position 53.

WEF’s Global Competitiveness Index 2017-2018 gives Israel a much higher valuation, ranking it 16^th overall. The country’s strongest pillars, according to the index, are innovation (3^rd) and technological readiness (7^th). Israel’s market size (56^th) and its macroeconomic environment (39^th) are considered its weakest performers.

Israel has had a considerable ascent in this index during the last years. In 2013 it ranked 27^th, by 2016 it had climbed to position 24, making an even bigger leap onto its current ranking (16^th). The report suggests that Israel’s positioning as one of the most innovative economies in the world is the key to its recent improvement.

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Israel’s global talent and soft power

How influential is Israel in terms of innovation, human resources and culture?

Israel ranks 24^th in the 2018 edition of the Global Talent Competitiveness Index. It is an important leader in terms of global knowledge, where it ranks 4^th. Israel also makes it to the top-25 for vocational and technical skills (23^rd) and talent retainment and enabling (both 24^th). Howecver, the country ranks much lower (50^th) for its ability to attract talent.

During the last two years, Israel has dropped out of the Soft Power Index that figures the thirty most influential countries in terms of soft power. Its last appearance was in 2015 when it ranked 26^th, with special attention put on Tel Aviv’s “artistic, start-up, diverse, LGBT-friendly glory”.

Brand Finance‘s Global Soft Power Index 2020 ranks Israel 25^th, commending its vibrant startup scene and move towards being a global tech hub. The Index remarks Israel’s strength as a top contender for sub factor influence (16^th), proving that small nations have the capability to outperform expectations through transforming global perceptions.

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Israel’s digital demand

How popular is Israel according to online searches?

The Digital Country Index 2017 ranked Israel 34^th for the frequency of global online enquiries made about the country. This is an important six positions lower than in the previous, 2015 edition. In 2017, Israel’s strongest pillars were prominence (25^th) and exports (26^th), while investment (36^th), talent (38^th) and tourism (47^th) scored lower.

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Israel’s environmental sustainability

How well does Israel look after its natural environment?

Israel scored fairly high in the 2018 Environmental Performance Index, ranking 18^th. With this result, it was the regional leader of Middle East and Northern Africa. The country made an impressive leap from position 49^th in the previous (2016) edition.

WEF’s evaluation of Israel’ environmental sustainability in the 2017 Travel and Tourism Competitiveness Index is a lot more critical –it scores 91^st out of the 134 countries surveyed in this study. Israel’s poorest indicators are baseline water stress (122^nd), environmental treaty ratification (115^th) and particulate matter concentration (103^rd). The only high-performing dimension in this study is Israel’s wastewater treatment, ranking 10^th.

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Social sustainability and life quality in Israel

How does Israel perform in reports of social well-being?

Israel performs well in various measures of well-being, in the 2018 Better Life Index. The country ranks above average in income and wealth, jobs and earnings, personal security, health status and subjective well-being. However, it scores below OECD average for the indicators education and skills, housing, environmental quality, work-life balance, social connections and civic engagement.

In general, though, Israelis seem more satisfied with their lives (7.2 on a scale from 0 to 10) than the OECD average (6.5).

Israel has a solid 11th position in the 2015-2017 World Happiness Report.

Israel ranked 54^th in the 2016 Happy Planet Index. It stands out for equality (10^th) and high life expectancy (8^th – an average of 81.9 years). Its score for well-being is also high, ranking 14^th out of the 140 countries included in the study. Here, Israel’s weakest pillar is its ecological footprint, which leaves the country at the bottom of the report, at 128^th position.

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Israel’s performance in the Good Country Index

Israel’s performance in the Good Country Index is moderate, ranking 53^rd in its latest edition. Due to its aggressive politics towards Palestine, Israel’s performance is poorest in the dimension of international peace and security, where it ranks 123^rd out of the 163 participant countries. Israel’s global contribution to prosperity and equality also receives a poor valuation, ranking 99^th. Its best performing pillars are planet and climate (25^th) and science and technology (31^st), which are the only dimensions that score above the top-50 in the Good Country Index.

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Corruption perception

Israel ranked 32^nd in the 2017 Corruption Perception Index, which is one position above Botswana and one below Taiwan. Compared to its neighbours, Israel’s performance is good. While the eastern neighbour Jordan positions 59^th, Lebanon (143^rd) and especially Syria (178^th) are left in the very final end of the ranking that studies 180 countries.

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Israel as nation brand

How well is Israel performing as nation brand?

Brand Finance’s 2017 Nation Brands Index ranked Israel 41^st in its annual study of the value of nation brands. According to the report, in 2017 the value of Brand Israel showed a 19% growth, reaching a value of $189 USDbn.  

The performance of Israel in the Country RepTrak is similar, ranking 42^nd in its 2017 study.

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Analysis by Maria Lindmäe. Last updated June 2018.

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