Israel's economy to shrink 4.2 pct in 2020: ministry

JERUSALEM, Nov. 30 (Xinhua) -- Israel's GDP is expected to contract by 4.2 percent this year and rise by 4.5 percent next year, according to a forecast released by the Ministry of Finance on Monday.

In addition, the unemployment rate in Israel, which currently stands at about 20 percent, will decrease to an average of 8.9 percent in 2021, according to the forecast.

These figures are based on a scenario whereby a COVID-19 vaccine will be available in the first half of 2021, alongside health restrictions, and economic recovery will intensify in the second half of 2021.

However, according to an alternative scenario of morbidity throughout most of 2021, with lockdowns and restrictions, Israel's GDP will shrink by 4.8 percent this year and rise by only 2.4 percent in 2021, while the unemployment rate will reach 12.3 percent.

According to the forecast, annual inflation in Israel in 2021 will rise by 0.3 percent, much lower than the government's annual target, ranging from one percent to three percent.

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