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Last-quarter GDP Plunges 7.2 Percent - Social and Economic Policy - Global Policy Forum The economy is in a far worse state than even the most pessimistic forecasts, according to figures released yesterday by the Central Bureau of Statistics. Last-quarter GDP Plunges 7.2 Percent
By Moti Bassok
Haaretz Daily
February 19, 2002Growth Domestic Product fell by an annualized rate of 7.2 percent in the fourth quarter 2001, following a 4 percent fall in the third quarter. In the second half of 2001, GDP fell by an annualized rate of 4.7 percent, the country's highest ever half-year drop.
For all of last year, GDP fell at an annualized rate of 0.5 percent, the worst figure recorded since 1953, when GDP contracted by 1.4 percent. The only other Western nation to register negative GDP in 2001 was Japan.
"There's no doubt about it that we are in a recession," said Jonathan Katz, macroeconomic strategist at Ofek Securities. "You look at the figures and you see the economy got worse as the year went on... The degree of the economic slowdown is surprising... It's a more negative slowdown than the market expected."
GDP per capita fell an annualized 9.5 percent in the fourth quarter and 7 percent in all of 2001. Business output in the last six months of 2001 fell at an annualized rate of 6.9 percent, while private consumption fell by an annualized 1.1 percent during the same period.
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