This 2013 Article IV Consultation highlights that Israel’s economic fundamentals has remained strong. GDP growth is solid, unemployment is low, and inflation remains firmly anchored within the 1–3 percent target range. The financial sector is in good health, and the external position is strong. On the structural front, concerted action is required to boost competition in the non-tradable sector, although it is imperative to promote the participation of Haredi and Israeli–Arab populations in the labor force to reduce poverty and inequality and bolster the economy’s long-run productive capacity.