According to preliminary estimates, Israel's gross domestic product grew by 4.8% in 2011, following a similar rise in 2010, and a 0.8% rise in 2009, when Israel crawled back out of the recession.

GDP per capita is expected to have risen 2.9% to $31,100.

The rating is "underpinned by the country's high levels of economic, institutional and financial strength and moderate event risk." – Moody's

One of the world's three largest rating agencies, Moody's, reiterated its A1 rating on Israel's domestic and foreign currency bonds with a “Stable” outlook for the Jewish state. 

"The Israeli economy is resilient and dynamic, and the macroeconomic policy framework is coherent," the rating agency noted in the report. "The high-tech exports-based economic model underpins favorable medium- to long-term growth prospects, though it is subject to cyclical fluctuations in world trade."

Apple Inc. has decided to open its first ever development center outside of its California headquarters in Israel.  The new center in Israel will focus on semiconductors.

Though a global innovator, Apple in 2010 only invested 2% of its revenue in R&D, much lower than other high-tech companies. The company currently has only one technology development center, which is at their headquarters in Cupertino, California.

Apple has hired Aharon Aharon, a veteran player in Israel's high tech industry, to lead the new development center.

Leading computing company Apple is acquiring Anobit, a developer of flash controllers and smartphone memory enhancement technology.

Anobit developed a chip which enhances flash drive performance through signal processing (DSP). Anobit previously supplied its technology to South Korea's Hynix Semiconductor Inc., the world's largest supplier of flash memory processors, and Samsung Electronics. Hynix's integration of Anobit's solutions, has allowed the company to lower the flash memory costs for smartphones, digital cameras, and tablet computers.

Anobit has two product lines: NAND-based embedded flash controllers for smartphones, music players, tablets, and other products; and flash memory Genesis Solid State Drives (SSD), which are designed to replace computers' magnetic hard drives that are the current memory mainstay of PCs and storage systems, such as those developed by IBM Corporation and EMC Corporation.

Akamai Technologies Inc., a Cambridge company that manages Web traffic for some of the Internet’s biggest sites, is acquiring website and mobile acceleration technology vendor Cotendo. Though a small competitor, Cotendo had been making big strides speeding up Web access on mobile phones, a fast growing segment of Akamai’s business.

Following the acquisition, Akamai will set up a research and development center in Israel.

"Cotendo's employees will find their places as employees of Akamai, and thus we will continue to grow," Ronni Zehavi, who is CEO of the company, said.

Cornell University and the Technion - Israel Institute of Technology have been chosen to build a cutting-edge NYC Tech Campus that will serve as a global magnet for tech talent and entrepreneurship. The NYCTech Campus will combine cutting-edge technologies to create one of the most environmentally friendly and energy efficient campuses in the world.

Cornell will offer Master and Doctoral degrees in areas such as Computer Science, Electrical and Computer Engineering, and Information Science and Engineering, and the campus will also offer innovative Technion-Cornell dual Master of Applied Sciences degrees.

New York City will provide $100 million for the site's site infrastructure, construction, and related costs. Construction of the first phase of campus is scheduled to begin in 2015.

Two high-level American delegations reached out to Israeli business leaders in December as they explored cooperation in renewable energy, aerospace, medicine and other technologies.

The American Chamber of Commerce Executives (ACCE) brought  25 heads of business representative bodies from American and Canadian cities to Israel, while a separate group of seven elected officials from New York, Ohio, Pennsylvania and Hawaii also visited the country.

Both delegations noted that they see endless opportunities for business collaboration with Israel, and spoke with admiration of the innovations they saw during their visit.

Israel Corporation has acquired Chilean power company Central Tierra Amarilla SA, which owns a 155-megawatt power station that uses open cycle diesel generators.

Israel Corp subsidiary IC Power will own 75% of Central Tierra Amarilla and a Chilean company will own 25%. Located north of Santiago, the power station mainly functions as a reserve energy source for local mines.

Israel Corp. Power subsidiary Inkia Energy Ltd., based in Lima, Peru, owns power stations producing 3,000 megawatts in seven countries: Peru, Bolivia, Chile, Panama, El Salvador, Jamaica, and the Dominican Republic.

Tourism to Israel in November rose 2% from the corresponding month in 2010 to 316,000 arrivals, and was the highest number of tourists for any November.

As part of an initiative to boost the tourism sector, including construction, renovation and conversion of existing buildings into hotels, six new hotels will open in Jerusalem, Haifa, Rosh Pina, and the Western Galilee and hotels in the Galilee and Tiberias will be enlarged. Two buildings in Haifa will be converted into hotels. The projects will add 470 new hotel rooms and see 300 rooms renovated.

Microsoft bought visual identification video search engine Videosurf, which developed a technology that locates video clips on the Internet.

The company, which was founded in 2006 by four Israelis in Silicon Valley, indexes over 250 million videos from various sites such as YouTube, CNN and Facebook and is used by major websites such as CBS and Warner Brothers. Its technology scans video clips quickly, implements a thorough search of their content, including faces and events, and tags the various clips. As of April 2011, the site claimed more than 20 million visitors a month, up sharply from the 1.5 million it was claiming in 2009.

CHS, a diversified energy, grains and foods cooperative owned by farmers, ranchers and co-ops across the United States, is acquiring Solbar Industries Ltd, a global leader in specialty soy proteins and soy isoflavones, for $113 million.

Solbar, headquartered in Ashdod, provides soy protein ingredients to manufacturers in the meat, vegetarian, beverage, bars and crisps, confectionary, bakery, and pharmaceutical manufacturing industries. The soy products company has manufacturing and logistics facilities in Ashdod and Ashkelon in Israel as well as in  South Sioux City, Nebraska, and Ningbo, China.

CHS, a Fortune 100 company, supplies energy, crop nutrients, grain, livestock feed, food and food ingredients, along with business solutions including insurance, financial and risk management services.

Israeli financial modeling company Modelity won the Structured Products Magazine’s technology innovation award for a second consecutive year.  Modelity, which develops and markets software for the financial market, combining innovative technology with advanced financial knowledge, was chosen from among the world's leading financial technology companies.

"What they offered was unique, and it seemed the logical choice for RBS" said Zak de Mariveles, managing director at RBS Global Banking & Markets.

Modelity’s software follows a structured product through its life stages including the offering, initial marketing, reporting performance to the customers, and culminating with the expiration date. Modelity's clients include most of Israel's and some of the world's leading financial institutions such as Barclays, RBS, Rabobank and Danske Bank.

Evature, a leading provider of free-text search technology for the travel industry, has won the DEMO award for the most game-changing travel innovation at the fourth annual Travel Innovation Summit in Miami as part of the industry-leading PhoCusWright Conference.

At the event, where Evature was also recognized as the most innovative international company, the Israeli start-up demonstrated its revolutionary B2B service - Eva, enabling travel companies to offer their customers the ability to search for travel using free text.

Evature's web service is base on innovative Natural Language Processing algorithms, specifically designed for "travel language", delivering a never before possible user experience.

OX1, a key drug compound that was developed by Dr. Daniel Chain while heading the Israeli company Mindset BioPharmaceuticals, has resulted in a $126 million global licensing deal for Manhattan-based Intellect Neurosciences which he currently heads as chairman and CEO.

OX1 is a highly potent multimodal, metal-binding antioxidant molecule, which has been demonstrated to protect nerve cells from highly oxidizing neurotoxins. ViroPharma plans to develop and commercialize OX1 as a treatment of Friedreich’s Ataxia and possibly other neurodegenerative diseases for which OX1 may qualify for orphan drug designation.

Israel’s Medigus has raised 9.3 million shekels ($2.5 million) in order to progress with regulatory approvals for its medical procedure video camera.  At 0.99 mm in diameter, the camera is the world’s smallest video camera.

The miniature cameras are designed specifically for small-diameter disposable endoscopic devices, and are used in various medical fields including: cardiology, orthopedics, gastroenterology, gynecology, otolaryngology, bronchoscopy and robotic surgery.

Treato, an Israeli web site that aggregates and analyzes user-generated data is said to revolutionize the way patients, physicians and drug companies share info about medications.

The site, which has been four years in the making, was launched in September and is expected to give a broader analysis of consumer-related data on the prevalence of drug side effects, especially when used with other drugs, as well as a variety of medical conditions, thereby expanding on any information currently available through pharma companies.

The Treato site covers 13,000 conditions and 11,000 medications. Of the 10 billion patient discussions, Treato indexes just over 800 million of them from 23 million patients.

"We are delighted to welcome the BigBand employees to ARRIS." - Bob Stanzione, ARRIS Chairman & CEO.

Communications-equipment maker Arris Group Inc. is acquiring digital-video networking company BigBand Networks Inc. for about $158.1 million in cash.

BigBand Networks, which has more than 200 customers in North America, Asia and Europe, provides broadband service providers with digital video networking solutions designed to make it easier to distribute, manage and monetize video.

ARRIS, headquartered in Suwanee, Georgia, USA, specializes in the design, engineering and supply of technology supporting triple- and quad-play broadband services for residential and business customers around the world.

Israel Corporation unit Cerro del Aguila SA has agreed to build a 510-megawatt hydroelectric power station in Peru at an investment of $680 million.

The Cerro del Aguila power station, located in Tayacaja Province in central Peru, in March signed a 15-year power purchase agreement with Peru's government-owned electricity company, which will come into effect when the power station is completed in the second half of 2015.

Israel Corporation is Israel’s largest holding company. Fifty of its manufacturing activities and 70% of its consolidated revenues derive from global operations. Its core holdings are fertilizers and specialty chemicals, energy, shipping and transportation.

The Israel-U.S. Binational Industrial Research and Development (BIRD) Foundation, approved $8.1 million of funding for nine new projects between Israeli and American companies. The approved projects involve innovations in the areas of life sciences, healthcare IT, electronics, software and energy.

In addition to the grants from BIRD, the projects will access private sector funding, boosting the total value of all projects to $24 million.

The BIRD Foundation promotes collaboration between Israeli and American companies in various technological fields for the purpose of joint product development. During its 34 years, the BIRD Foundation has invested in more than 820 projects, which have yielded direct and indirect revenues of about $8 billion.

Israeli navigation tech start-up Waze raised a $30 million investment from Hong Kong's Li Ka-shing, greater China's richest man.

Waze's free mobile application provides a social network where drivers interact, reporting on road conditions. Its goal is to shepherd drivers by optimal routes to their destination by voice and offer data on traffic conditions, as supplied by users.

Waze, which was founded in 2008, has more than 7 million users in the United States, Italy, France, Spain and Israel.

Li, who invests in Israeli companies through his investments' arm Horizons Ventures, earlier invested in Israeli video-editing startup Magisto.

The U.S. Food and Drug Administration approved KRYSTEXXA, a drug jointly created by Israel's Bio-technology General and US partner Mountain View Pharmaceuticals.

According to a Phase III study published in The Journal of the American Medical Association (JAMA) in August, KRYSTEXXA is the first FDA approved treatment to show significant clinical improvement within six months of therapy. The drug was developed using Bio-Technology General's expertise in production and purification of recombinant proteins for parenteral use.

"KRYSTEXXA is the first-ever and only treatment approved by the FDA for adult patients who suffer with chronic gout that is refractory to conventional therapy," said Paul Hamelin, president of Savient Pharmaceuticals, which has exclusively licensed worldwide rights to the jointly-developed technology and currently markets the drug worldwide.

European Commission Vice President Antonio Tajani and Israel's Minister of Industry, Trade and Labor Shalom Simhon, signed two joint statements of intent to improve cooperation in the fields of space and tourism.

The agreement paves the way for the EU’s Galileo global-navigation satellite system to establish a satellite receiving station in Israel, and it also strengthens bilateral cooperation in space-related R&D. To strengthen bilateral tourism cooperation, several actions were also agreed in order to facilitate tourism flows by promoting travel in the respective low seasons.

The trial of the PLX-PAD cells, which was conducted under protocols approved by the US Food and Drug Administration (FDA) and Germany's Paul-Ehrlich-Institute (PEI), met all its safety and efficacy endpoints at all dosage levels and found no malignancies, adverse events, or immunological reactions in the patients.

ISRAELI AIR FORCE TECHNOLOGY HELPS IMPROVE SPORT PERFORMANCE

Israel's Applied Cognitive Engineering Ltd (ACE), which specializes in computer-based cognitive simulation training, and USA Hockey, the national governing body for the sport of ice hockey in the United States, have created a ground-breaking product called Hockey IntelliGym that helps players develop perception and decision-making skills.

The technology used for developing the Hockey IntelliGym was initially developed to train Israeli combat pilots on the cognitive brain level.

The program utilizes a software-based training environment containing automatic customization algorithms that adjusts the training program to each individual player according to his/her personal strengths, weaknesses and progress rate.

The program recorded an increase of 20% to 40% in players’ actual on-court/ice stats. Since its adoption three different IntelliGym-trained National teams participated in a total of 12 international tournaments, including three world championships, out of which they have won an unprecedented 9 gold medals.

The IntelliGym has been granted with the first ever Brain Fitness Innovation Award, reviewing 40 implementations in that area.

Professor Daniel Shechtman of the Technion-Israel Institute of Technology has been designated the winner of the Nobel Prize in Chemistry for 2011 for his discovery of quasicrystals - a new form of matter that has become a major subject field for physicists, materials scientists, mathematicians, and crystallographers.

Shechtman, who was born in Tel Aviv in 1941, had previously been awarded the Israel Prize in Physics in 1998 and the Wolf Prize in Physics a year later. He discovered the Icosahedral Phase of crystals aluminum transition metal alloys in 1982.

Shechtman is the tenth Israeli to win the Nobel Prize. The most recent awardee was Prof. Ada Yonath of the Weizmann Institute who won the 2009 Nobel Prize in Chemistry for her work on the ribosome.

Trade in 2010 between Israel and the other countries that comprise Mercosur, Brazil, Uruguay and Paraguay, reached $1.8 billion.  Trade with Argentina, on the other hand, only reached $130 million due to high tariffs on Israeli goods there.

With the gradual expiration of the tariffs prescribed by the free trade agreement, Brazil, the largest regional economy, expects to triple its trade with Israel by 2015. Its $1.35 billion in trade last year increased from $922 million in 2009.

Citigroup intends to open a technology research and development center in Israel in December to support its global activities.

"Citi has many development centers which support the bank's global operations, and it will add the Israeli center to its portfolio as a center of strategic innovation that focuses on the development of advanced products and applications for the capital market," said Don Callahan, Citi's chief operations and technology officer.

As part of a plan launched by the Israeli government in 2010 to attract financial services sector firms to Israel, the government has granted Citi 93 million shekels ($25 million) over five years to help finance the center.

The U.S. bank will become the second international bank to open an R&D center in Israel after Barclays Capital, which opened earlier this year.

Chipmaker Intel Corp has agreed to acquire mobile navigation software maker Telmap.

Telmap, which provides mapping, local business listings and other location-based services, has been profitable since last year, with sales for 2010 reaching $28 million, and an expected turnover of $33 million for 2011. Telmap powers mapping applications for a number of mobile operators, including Orange, Telefonica’s O2 and SFR in France.

Herzliya-based Telmap has 210 employees.

Intel, the world's No. 1 chipmaker, has two plants and four development centers in Israel.

The Monsanto Company, a US-based multinational agricultural biotechnology corporation, has acquired Beeologics Ltd., a developer of targeted biological pest and disease control solutions for bees and bee colonies.

Monsanto stated it would support Beeologics' team and products pipeline and intends to apply Beeologics' expertise in biological products for more general use in agriculture, by using the company's core technology for its discovery and development pipeline. One of Beeologics' current projects includes a product that uses a naturally-occurring process to help protect bee health. 

The TechCrunch blog named Shaker, a social game played via the Facebook platform, the winner of its TechCrunch Disrupt San Francisco 2011 start-up contest.

Shaker, which has raised $3 million in funding, takes basic social gaming a step further by allowing users to meet new people. The game uses profile information to show what else each player may have in common with seemingly random people in the room to facilitate communication between players.

ISRAELI RESEARCHERS IDENTIFY KEY TO INSULIN PRODUCTION 

A multi-year project led by Prof. Yuval Dor of the Hebrew University's Institute for Medical Research has identified a glucose-sensing enzyme in the cells, glucokinase, as the key molecule that triggers beta cell regeneration in diabetic mice.

Since the study showed that regeneration depends on glucokinase levels, the finding may pave the way for developing a new kind of drug to modulate glucokinase or other steps in the glucose-sensing pathway to direct beta cells toward regeneration and replication, and offers hope for people with Type 1 ("juvenile") diabetes.

Standard & Poor's upgraded Israel's long-term foreign-currency sovereign rating from A to A+ with a "Stable" outlook, citing Israel's "prosperous and resilient economy, strong institutions, ongoing fiscal consolidation, and robust external performance. The rating agency also reaffirmed Israel's local currency rating at AA-.

“The rating action reflects our view of Israel's improved economic policy flexibility as a result of strong growth and careful macroeconomic management,” S&P said. “Israel is on a credible path toward continued government debt burden reduction and stronger external indicators.”

U.S. Investment Bank Morgan Stanley raised its growth forecast for Israel to 4.8% for both 2011 and 2012 from its previous growth forecast of 4.3%, noting that the Israeli economy "remains one of the robust and well managed among both the developed and the emerging market economies."

"Having shown an excellent track record in weathering the most recent crisis via timely monetary and fiscal policy responses, the country earned well deserved respect and confidence among global investors," the bank said.

Foreign direct investment (FDI) in Israel totaled $500 million in June, rising above the monthly average of $410 million for the first half of 2011. The majority of investments were made in the high tech sector.

Net foreign investment in stocks traded on the Tel Aviv Stock Exchange (TASE) totaled $440 million in June, 9% higher than in May, and well above the $240 million monthly average recorded during the first six months of the year.

Israel's Ministry of Industry, Trade and Labor launched a new incentive to encourage and assist Israeli companies interested in trading in China and India.

A company that is selected for the program can receive up to 700,000 shekels a year for three years. The funds are to be used to help the company establish and operate an overseas office in India or China, including a local team and a consultant. The company will also receive a single grant of 400,000 shekels to set up a beta-site to prove the product or service's application in the local market.

The program is geared to medium to large companies with sales of between 20 and 200 million shekels and annual exports of at least 10% of sales that are interested in establishing themselves in the Indian or Chinese market for the long run.

Financial services provider S1 Corp is buying Fundtech Ltd, a provider of payment systems and services for $325 million.

Following the acquisition S1 shareholders will own about 55 percent of the combined company and Fundtech shareholders the rest. The combined company, which will be headquartered in Atlanta, Georgia and will be called Fundtech, will be led by S1 Chief Executive Johann Dreyer.

Fundtech develops transaction banking solutions that automate activities such as payments, cash management, settlement, liquidity management, and the financial supply chain, and was founded in 1993. S1 Corporation delivers integrated financial services on an open platform to leading financial institutions, retailers, and processors.

ValueClick Inc. acquired digital marketer Dotomi Inc., a leader in personalized media, for $295 million.

Dotomi, which was founded in 2003, raised $17 million in funding since its inception from Globespan Capital, US Venture Partners, Investor Capital and Velocity. The company has developed a kind of private advertising channel that enables advertisers to send marketing messages directly to potential customers via Internet banners.

Dotomi founder Yair Goldfinger also co-founded ICQ, the technology known today as instant messaging. ValueClick is one of the world's largest integrated online marketing companies.

"Ophir has a history of impressive revenue growth. Their differentiated technologies, well-respected brands and strong customer relationships are an excellent fit with Newport's strategic agenda." - Newport president and CEO Robert J. Phillippy

Newport Corp, a U.S. manufacturer and distributor of precision components, bought Jerusalem-based Ophir Optronics Ltd. for $230 million in cash.

Ophir will become a wholly owned subsidiary of Newport and merge with a newly formed Newport subsidiary

Ophir Optronics develops and manufactures optical equipment for the defense and civilian markets. The company has plants in Israel and the US, and sales offices in the US, Japan, and Europe.

Newport Corporation, established in 1969, is a leading global supplier of advanced technology products and solutions for scientific research, life & health science, aerospace & defense, photovoltaics, industrial manufacturing, semiconductors, and microelectronics markets.

Israel's Radiancy Inc., a privately held maker of at-home dermatological products, is merging with US company Photomedex in a share swap deal that gives Radiancy a $175 million valuation.

On completion of the deal, current PhotoMedex shareholders will own 25% of the combined company, while Radiancy's current shareholders will hold 75%.

Among other things, Radiancy has developed a home hair removal device, a device for treating acne, and a home device for rejuvenating the skin.

PhotoMedex develops excimer laser, LED light systems and skin care products for dermatological applications.