Israel is still considered one of the leading states when it comes to innovation, but Israel has suffered a sharp decline year after year since 2019. The reasons are not surprising: Bad infrastructure, institutions, and low creative outputs are the reasons.
Israel ranks 16th in the WIPO’s (World Intellectual Property Organization of the UN ) global innovation ranking for 2022. In 2019, Israel ranked 10th and has been deteriorating year by year as shown in the chart below from the Global Innovation Index Report:
The UN ranking for innovation is based on seven pillars: Institutions, Human Capital & Research, Infrastructure, Market Sophistication, Business Sophistication, Knowledge & Technology, Creative Outputs.
If you take a closer look at the individual factors, you can quickly see where the problem areas are and which have not just existed in Israel since yesterday, but are escalating more and more from year to year.
Israel occupies 41st place globally in the pillar ‘Institutions’. The inefficiency and redundancy of the bureaucracy are particularly problematic. Here Israel comes in at an embarrassing 115th place (out of 190 countries). Bureaucracy is the main problem for innovation in Israel. And not only for innovation and business, but also in everyday life for the average citizen. Accordingly, the ranking for the economic framework conditions: Here Israel occupies place 47.
For the pillar ‘Human Capital & Research’, Israel ranks 24th in this pillar, which is almost exclusively due to the fact that it has been number 1 in spending on research and development for many years. Heir, Israel reliably holds number 1. However, Israel is no longer in the top 10 for all other indicators in this column.
Finally, the infrastructure pillar is the worst pillar, with Israel doing particularly poorly at 42nd place. In the area of ‘General Infrastructure’, Israel only ranks 33rd.
The underperformance of the ‘Cultural Output’ pillar is also not surprising. Hardly any value is placed on the so-called soft skills in Israel and with it culture. Only in the creation of apps does Israel occupy an outstanding third place, which probably prevented the complete crash in this area.
Where does the relatively good placement come from? It is essentially due to the core factors of innovation, all of which Israel is in the top 10. But prospectively, a future descent will be unavoidable if Israel does not finally turn its attention to the so-called “soft” factors of innovation. Sooner or later the previous good rankings in the core factors of innovation will also start to slide.
7th place globally in the pillar ‘Market Sophistication’, 6th place in the pillar ‘Business Sophistication’, and 7th place in ‘Knowledge&Technology Output.’ That’s great and Israel draws on it. Israel must finally bring its political institutions, infrastructure and bureaucracy into line.
The slide below gives more details:
The WIPO summerizes the performance in the key factors of innovation which ranks Israel on the awesome place 3: “The United States still leads in terms of the number of GII innovation indicators for which it ranks top globally, ranking 1st in the world on 15 out of the 81 indicators used, two more than in 2021. It is number one in the world in indicators such as Global corporate R&D investors, Venture capital investors, the quality of its universities, the quality and impact of its scientific publications (H-index), the number of Patents by origin, computer software spending, and the value of corporate Intangible asset intensity.
Singapore follows the United States globally and is number one in the world on 11 indicators in total, one up from 2021, including leading in the indicators Government effectiveness, ICT access, Venture capital investors, High-tech manufacturing and GitHub commits. China, Hong Kong (China) and Israel tie jointly in 3rd place, attaining top ranking in Trademarks, High-tech imports and R&D expenditure, respectively. They are followed by Malta in 6th place, leading in Joint venture/strategic alliance deals. The Republic of Korea is in 7th, leading in number of researchers. Japan and Cyprus tie in 8th place, ranking 1st in Patent families and Mobile app creation. Finally, Switzerland, Estonia and Iceland share jointly the 10th position, leading in PCT patents, New businesses and ICT use, respectively.“
On the short to middle run, Israel has to stop the decline and the fields which need attention are all domestic ones. So relief is possible. The decline in innovation is a threat to the very existence of the only Jewish state: Israel.