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Analysis: Greece could learn from Israel's journey

    VIt is only symbolic that the announcement of Israel's acceptance to the lucrative economic club of developed countries, the Organisation for European Economic Cooperation and Development, comes just one week after Bank of Israel governor Stanley Fischer began his second term.

    When Mr Fischer, former deputy managing director of the International Monetary Fund, stepped into the central bank building in Jerusalem in May 2005, the Rhodesian-born professor of economics announced that one of his main objectives was to help Israel get accepted as a member of the OECD.

    After a long process, which had started as far back as the mid-1990s, Israel's status has been finally changed from a developing economy to a developed one.

    Mr Fischer has defiantly played a major role in making the dream come true, but much credit for this impressive landmark goes to other policy makers and to the general Israeli public as well.

    The affirmation of Israel's economic status comes as the whole financial world closely watches the latest economic developments in Europe in general and Greece in particular.

    Now that Israel is a full member of the prestigious club it is easy to forget that, like Greece today, less than a decade ago Israel was facing a serious economic crisis that threatened its future.

    In the wake of the dot.com crash and the suicide attacks of the second intifada, the Israeli economy came to a complete standstill, resulting in frightening budgetary deficit and government debt level.

    Israel realised at that time that drastic measures were required, including sharp cuts in the government budget, reducing the public sector and carrying out an extensive market reform.

    Under the leadership of Prime Minister Ariel Sharon and Finance Minister Binyamin Netanyahu, and backed by American loan guarantees, the local economy emerged much stronger from one of the worst economic crises in the Jewish state's history.

    The fact that Israel has now become the 32nd member of the OECD marks the long way Israel has made from facing a Greek-like economic tragedy to the happy end.

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