Israel will balance new COVID-19 rules against growth

Significance

Although the number of new cases has exceeded previous peaks, serious cases have not grown proportionately. Despite earlier warnings, the capacity of the country’s hospitals has not yet been tested, enabling Israel to rely on relatively mild containment measures.

Impacts

• The government’s ability to cover the cost of countercyclical measures, if the economy does take a turn for the worse, is limited.
• Although the overall economy has been performing well, many segments, notably tourism, will remain depressed.
• The vaccination of children could become an increasingly political issue in crowded classrooms as the new school year gets going.