Rafa is one of Israel’s oldest pharma companies. This week, I noticed a new sign on a developmental complex in Jerusalem, denoting where the company will build a new US$35m facility for 130 workers.

Just down the road is the Bank of Israel. This is another institution in a happy mood. Its revised predictions for 2010 and 2011 are a metaphor for optimism.

Growth of 3.7%, rising to 4.0% in 2011. Standard of living; 9.2% and 7.4%. Unemployment falling to 6.7%. And exports increasing at a steady 4.5%.

There are concerns if the stock market is too high and if the price of real estate is reflecting a bubble. But neither of these issues undermine basic economic fundamentals.

Next to Rafa is a new biotech centre, close to completion. Obama may not be pleased with Israel’s politicians, but the economy is pressing on regardless.