This week has seen continuing further international notification of Israel’s improving economic climate. CNBC’s coverage of the country’s innovative skills has been supported by other news.

Let’s start with Israel’s application to join the OECD. It appears that the 4 year process is drawing to a close. In January 2010, the organisation’s Secretary-General, Angel Gurria, will pay an official visit to Jerusalem, with the final papers expected to be completed by April.

This week, showed how Israel is about to become an exporter of energy, an amazing turn around with positive political and economic repercussions. Talks have commenced to supply gas to Cyprus.

Eric Dutram, an observer of funds and portfolios, summed up what is happening by referrring to the “TICK”  drive. Israel is part of a new group of countries, including Taiwan, Chile and Korea, where “many investors might be better suited tilting their international exposure”.

These economies may be small, but they all pack an economic punch. All four are ranked between 25-50 on the Human Development Index,  and all have above world average GDP per capita (PPP).

Why Israel specifically?

Israel is seeking to become a solar power leader in the region, which could lessen dependence on the actions of occasionally hostile neighbors. Israel has one of the highest rates of solar water heater usage, with almost 90% of the population heating their water this way (PDF). Israel also has “Silicon Wadi” or their version of Silicon Valley, which has become a high tech hub in the Middle East attracting companies such as IBM, Google, and Intel. Silicon Wadi has been described as the second most important center of innovation in the world, and with good reason. It has produced impressive technological feats such as Intel’s Centrino chip and the programing code PHP. Israel also has a very well educated workforce that are trained in technical skills, with a high level of engineers at 135 per 10,000 employees (well above America’s 70 per 10,000).