Look for Israel in the international press and almost invariably the country’s name is linked to yet another diplomatic crisis. A few  will point out that it has a strong high-tech sector, that the Jerusalem government has been at the forefront of international aid efforts, and even that it has an amazingly open educational system.

Even fewer will go on to mention the strength of the economy. For example, GDP continues to progress around 3% per annum, even if this is slightly slower than in previous years. Unemployment has dropped again, somewhat unexpectedly, to 5.5%. Inflation is steady. The stock exchange is showing signs of increased trading following a year of reforms. And so the list of positives goes on.

So if life is fairly stable, what are the momentous events looming ahead for 2014 and how will they impact on the economy of the Holy Land? There are four items to watch out for.

1) Diplomacy

Well, people have been talking about this for 50 (or is it 5,000?) years. Simply put, if John Kerry’s efforts show significant progress, it is fair to assume that more investment markets will open up for the financial planners in Tel Aviv and in Jerusalem. After all, Israel is now part of the OECD and a member of the top tier of stock markets. Greater security will encourage global analysts to follow the likes of Intel, Siemens, HSBC and others such likes, who have set up so prosperously in Israel over the past two decades.

2) New gas reserves

If Israel’s economy grew by around 3.3% in 2013, it is estimated that about 25% that uplift was caused by the new offshore gas industry. And the full effect of the revenue flows from this source have yet to be felt by the Ministry of Finance. Israel’s dependence on overseas supplies is to be severely curtailed and there will be a massive flip to the balance of payments. In other words, the gas reserves are a potential game-changer in the Middle East puzzle board.

3) Structural changes

It is an open secret that Israel’s economy suffers from the effect of three monoliths within the public sector. First,  the Electricity Company, which reeks of internal inefficiencies, over staffing, and employees who receive free energy. Next are the seaports of Haifa and Ashdod, where union power ensures that many of the employees are related to each other, usually receiving wages that dwarf those of doctors. And, not to be left out are the farmers’ organisations, who for decades have campaigned against competitive imports.

So long as the voter only has a say once every four years, they are simply expected to pay the consequences in silent… until now? Maybe parts of the Israeli government, populated by politicians with few ties to the prior allegiances will have the courage and strength to end such a farce.

4) The end of economic concentration

It is no secret that for all of Israel’s achievements, too much wealth is concentrated in the hands of a few families. Even the OECD has pointed out the extremes of these absurdities. Fortunately, there may be some changes in the pipeline. For a start, the government is beginning to ensure that the leading financial institutions divide up some of their empire. This will open the industry further to overseas competition, something which should benefit the consumer. Second, some of the strong local ‘oligarchs’ , noticeably Nochi Dankner, have simply got it wrong and have seen the banks call in the debts.

Bottom line for Israel in 2014? Providing the politicians do not blow the gains of recent years through meaningless spending and assuming just a few of the reforms mentioned above come through, the new year looks to be full of economic promise for its 8  million citizens.