Like the song in the Sound of Music, 16 going on 17, Israel’s economy seems poised to have another year of success.

Contrary to the predictions of many pundits, the statistics coming out of the Holy Land for 2016 really rock it. Boasting a 3.5% growth spurt, the Bank of Israel has calculated that the standard of living leapt by 2.9%. Unemployment dropped to a record low of 4.8%. Private consumption was up by 5.9%. Per capita growth rose 1.5%.

To paraphrase one of the skeptics, Sever Plocker, the upturn has secured a stable currency. In turn, the ration between GDP (the size of the economy) to the country’s debt has fallen to just over 60%. Most European countries are nowhere near this excellent level, which was actually a target set to met in about ten year’s time!

As for next year? Growth is set for a further 3.2% jump. Corporation tax will drop by one per cent to 24%. Income tax for the middle classes is to be reduced. The amount of guaranteed holidays for lower grade workers will increase. And the Tel Aviv stock market, which was stagnant in 2016, is projected to move up about 8%.

The stuff of Disney tales, indeed. Most of the OECD countries would settle for even half of all of this good news.

Unfortunately, beneath the headlines, there is another economy. The other stat that caught my eye last week was that approximately 20% of all Israeli families are looked after by social services. This includes 50% of those aged over 75 and nearly 23% of children aged between 12 and 17. Unacceptable.

Israel is a country of two economies!

In many other countries, that state of affairs could be seen as a threat to social stability. In Israel, the situation, as ever, is more complex. And if I can generalise for a moment: Ultra-orthodox Jews tend to have large families, yet tend to live modestly and are supported by an extensive system of charities. And large Arab families are still far better off than others in neighbouring countries such as Lebanon, Jordan and Syria.

Nevertheless, it is not a situation that should be taken for granted. More highly religious Jews are entering the workforce. There are schemes to encourage high-tech start-ups in the minority sectors. That is not enough, and the country faces key structural challenges that hold back progress.

• The price of housing leaves most young couples firmly outside the game.
• Regulation is prevalent and increasing, acting as a drain particularly on the SME sector.
• There is a glaring lack of competition in the banking sector.
• Food prices are kept high as interest groups keep out foreign competition.
• The ports have yet to be privatised, thus ensuring continued inefficiencies and unnecessary costs passed on to the consumer.

I am sure that 2017 will turn in another set of fine numbers at a macro level for the Israeli economy. Mazaltov! My fear is that more and more people will be left behind in the process. In that scenario, there is rarely a happy ending. More needs to be done to ensure that this progress is enjoyed by a greater number, and not just the privileged families running the government.