Israel has a GDP of $540B compared to $12B for South Sudan, ranking 29/197 and 149/197 by economy size, respectively.
Israel has $366B in government debt (67.6% of GDP), compared to $7.04B (50.7% of GDP) in South Sudan.
Israel vs South Sudan GDP by year
| Year | GDP, current $ | |
|---|---|---|
Israel
|
South Sudan
|
|
| 2024 | $540,379,921,262 | - |
| 2023 | $512,184,638,999 | - |
| 2022 | $525,181,008,026 | - |
| 2021 | $489,851,549,972 | - |
| 2020 | $410,768,352,658 | - |
| 2019 | $400,645,216,359 | - |
| 2018 | $376,299,083,108 | - |
| 2017 | $358,451,839,053 | - |
| 2016 | $321,940,971,558 | - |
| 2015 | $303,469,434,072 | $11,997,800,760 |
| 2014 | $315,017,088,117 | $13,962,212,847 |
| 2013 | $298,478,070,673 | $18,426,469,017 |
| 2012 | $263,589,172,712 | $11,931,472,169 |
| 2011 | $268,094,998,225 | $14,907,308,933 |
| 2010 | $239,679,036,634 | $14,602,072,411 |
| 2009 | $213,403,181,853 | $12,231,264,525 |
| 2008 | $221,231,658,863 | $14,586,253,383 |
| 2007 | $184,681,214,673 | - |
| 2006 | $158,900,547,825 | - |
| 2005 | $147,519,922,009 | - |
| 2004 | $140,047,984,605 | - |
| 2003 | $131,408,914,824 | - |
| 2002 | $125,332,331,884 | - |
| 2001 | $135,002,039,613 | - |
| 2000 | $136,512,300,542 | - |
| 1999 | $121,417,185,062 | - |
| 1998 | $120,547,409,279 | - |
| 1997 | $119,459,826,347 | - |
| 1996 | $115,116,595,545 | - |
| 1995 | $105,497,418,059 | - |
| 1994 | $90,740,103,829 | - |
| 1993 | $79,855,877,174 | - |
| 1992 | $79,457,685,757 | - |
| 1991 | $70,998,755,007 | - |
| 1990 | $62,016,729,541 | - |
| 1989 | $52,443,479,454 | - |
| 1988 | $52,650,948,910 | - |
| 1987 | $43,049,543,635 | - |
| 1986 | $35,834,154,874 | - |
| 1985 | $28,905,736,367 | - |
| 1984 | $30,645,607,293 | - |
| 1983 | $32,675,755,462 | - |
| 1982 | $29,255,285,401 | - |
| 1981 | $26,882,009,819 | - |
| 1980 | $25,395,256,478 | - |
| 1979 | $22,609,741,060 | - |
| 1978 | $17,701,286,907 | - |
| 1977 | $18,257,113,904 | - |
| 1976 | $15,956,349,550 | - |
| 1975 | $16,141,767,373 | - |
| 1974 | $17,172,607,138 | - |
| 1973 | $11,902,574,259 | - |
| 1972 | $9,222,557,539 | - |
| 1971 | $7,052,544,000 | - |
| 1970 | $7,406,712,876 | - |
| 1969 | $6,297,852,761 | - |
| 1968 | $5,458,427,928 | - |
| 1967 | $4,762,386,783 | - |
| 1966 | $4,703,300,098 | - |
| 1965 | $4,329,084,429 | - |
| 1964 | $4,024,344,853 | - |
| 1963 | $3,535,949,089 | - |
| 1962 | $2,966,154,031 | - |
| 1961 | $3,708,586,471 | - |
| 1960 | $3,070,585,807 | - |
Data sources: World Bank | Economy & Growth (1960–2024, retrieved 2026-04-06).
GeoRank.org/economy/israel/south-sudan | CC BY 
GDP per capita in Israel vs South Sudan by year
| Year | Current $ | |||
|---|---|---|---|---|
|
Israel
|
South Sudan
|
|||
| GDP per capita | GDP per capita, PPP | GDP per capita | GDP per capita, PPP | |
| 2024 | $54,177 | $57,236 | - | - |
| 2023 | $52,004 | $55,171 | - | - |
| 2022 | $54,950 | $53,619 | - | - |
| 2021 | $52,271 | $46,162 | - | - |
| 2020 | $44,576 | $40,955 | - | - |
| 2019 | $44,251 | $41,325 | - | - |
| 2018 | $42,363 | $40,190 | - | - |
| 2017 | $41,138 | $39,471 | - | - |
| 2016 | $37,672 | $38,189 | - | - |
| 2015 | $36,213 | $35,871 | $1,080 | $1,155 |
| 2014 | $38,343 | $34,816 | $1,243 | $1,373 |
| 2013 | $37,034 | $34,827 | $1,650 | $1,917 |
| 2012 | $33,321 | $32,484 | $1,109 | $1,417 |
| 2011 | $34,523 | $31,314 | $1,449 | $2,718 |
| 2010 | $31,439 | $29,456 | $1,498 | $2,948 |
| 2009 | $28,508 | $28,087 | $1,323 | $2,911 |
| 2008 | $30,269 | $28,084 | $1,654 | $2,887 |
| 2007 | $25,721 | $28,307 | - | - |
| 2006 | $22,527 | $26,385 | - | - |
| 2005 | $21,287 | $25,701 | - | - |
| 2004 | $20,568 | $26,078 | - | - |
| 2003 | $19,643 | $24,702 | - | - |
| 2002 | $19,076 | $26,101 | - | - |
| 2001 | $20,966 | $25,806 | - | - |
| 2000 | $21,707 | $25,766 | - | - |
| 1999 | $19,823 | $23,415 | - | - |
| 1998 | $20,189 | $22,927 | - | - |
| 1997 | $20,469 | $22,279 | - | - |
| 1996 | $20,224 | $21,672 | - | - |
| 1995 | $19,026 | $20,642 | - | - |
| 1994 | $16,807 | $19,478 | - | - |
| 1993 | $15,179 | $18,218 | - | - |
| 1992 | $15,510 | $17,553 | - | - |
| 1991 | $14,346 | $16,486 | - | - |
| 1990 | $13,308 | $15,721 | - | - |
| 1989 | $11,608 | - | - | - |
| 1988 | $11,853 | - | - | - |
| 1987 | $9,853 | - | - | - |
| 1986 | $8,335 | - | - | - |
| 1985 | $6,829 | - | - | - |
| 1984 | $7,369 | - | - | - |
| 1983 | $7,960 | - | - | - |
| 1982 | $7,258 | - | - | - |
| 1981 | $6,795 | - | - | - |
| 1980 | $6,549 | - | - | - |
| 1979 | $5,972 | - | - | - |
| 1978 | $4,797 | - | - | - |
| 1977 | $5,053 | - | - | - |
| 1976 | $4,516 | - | - | - |
| 1975 | $4,672 | - | - | - |
| 1974 | $5,085 | - | - | - |
| 1973 | $3,631 | - | - | - |
| 1972 | $2,930 | - | - | - |
| 1971 | $2,298 | - | - | - |
| 1970 | $2,490 | - | - | - |
| 1969 | $2,189 | - | - | - |
| 1968 | $1,947 | - | - | - |
| 1967 | $1,735 | - | - | - |
| 1966 | $1,789 | - | - | - |
| 1965 | $1,689 | - | - | - |
| 1964 | $1,626 | - | - | - |
| 1963 | $1,486 | - | - | - |
| 1962 | $1,294 | - | - | - |
| 1961 | $1,697 | - | - | - |
| 1960 | $1,452 | - | - | - |
Data sources: World Bank | Economy & Growth (1960–2024, retrieved 2026-04-06).
GeoRank.org/economy/israel/south-sudan | CC BY
Israel's GDP per capita is $54,177, ranking 21/197, compared to $1,080 in South Sudan, ranking 175/197. Adjusted for purchasing power (GDP per capita PPP), Israel ranks 36th at $57,236, while South Sudan ranks 197th at $1,155.
Economic indicators
|
Israel
|
South Sudan
|
|
|---|---|---|
| Gross domestic product |
$540B
2024 |
$12B
2015 |
| GDP rank |
29/197
2024 |
149/197
2015 |
| GDP growth |
0.87%
2023-2024 |
-10.8%
2014-2015 |
| GDP per capita |
$54,177
2024 |
$1,080
2015 |
| GDP per capita rank |
21/197
2024 |
175/197
2015 |
| GDP per capita, PPP |
$57,236
2024 |
$1,155
2015 |
| GDP per capita PPP rank |
36/197
2024 |
197/197
2015 |
| Government debt |
$366B
2024 |
$7.04B
2015 |
| Debt-to-GDP ratio |
67.6%
2024 |
50.7%
2024 |
| Government debt per person |
$36,645
2024 |
$633
2015 |
| Government debt per person rank |
18/185
2024 |
158/185
2015 |
| Average annual personal income after taxes |
$43,003
2026 |
$1,305
2026 |
| Market capitalization of domestic companies |
$331B
2024 |
n/a |
| Number of millionaires |
179,905
2025 |
n/a |
| Number of billionaires |
41
2025 |
n/a |
| Income share by richest 10% |
26.6%
2021 |
33%
2016 |
| Income share by poorest 10% |
2%
2021 |
1.8%
2016 |
| Government expenditure, % of GDP |
43.8%
2024 |
18.1%
2024 |
| Consumer prices inflation |
3.07%
2023-2024 |
91.4%
2023-2024 |
| Central bank interest rate |
4.5%
2024 |
15%
2023 |
| Unemployment rate |
2.9%
2024 |
12.3%
2008 |
| Population |
10290887
|
12507858
|
Spending and national debt comparison by year
| Year | % of GDP | |||
|---|---|---|---|---|
|
Israel
|
South Sudan
|
|||
| Government spending | Government debt | Government spending | Government debt | |
| 2024 | 43.8% | 67.6% | 18.1% | 50.7% |
| 2023 | 39.3% | 61.3% | 21.4% | 51.9% |
| 2022 | 36.9% | 60.3% | 29.4% | 37.3% |
| 2021 | 40% | 67.7% | 44.1% | 50.2% |
| 2020 | 44.8% | 71.1% | 34.1% | 49% |
| 2019 | 38.7% | 59.3% | 47.9% | 43.1% |
| 2018 | 39.2% | 60.1% | 54.5% | 77.6% |
| 2017 | 38.3% | 59.8% | 97% | 178.3% |
| 2016 | 37.9% | 61.7% | 66.5% | 164.7% |
| 2015 | 37.6% | 62.8% | 34% | 58.6% |
| 2014 | 38.3% | 64.9% | 35.8% | 37.7% |
| 2013 | 39.7% | 66% | 25.3% | 17.6% |
| 2012 | 39.6% | 66.9% | 31.6% | 8.91% |
| 2011 | 39.3% | 67.2% | 20.8% | - |
| 2010 | 39.7% | 69% | - | - |
| 2009 | 41.4% | 72.6% | - | - |
| 2008 | 41.2% | 70.2% | - | - |
| 2007 | 40.2% | 70.8% | - | - |
| 2006 | 41.6% | 77.7% | - | - |
| 2005 | 42.3% | 85.2% | - | - |
| 2004 | 43% | 88.3% | - | - |
| 2003 | 45.4% | 89.7% | - | - |
| 2002 | 50% | 87.2% | - | - |
| 2001 | 46.1% | 81.1% | - | - |
| 2000 | 43.4% | 77.2% | - | - |
| 1999 | 53.6% | 94.8% | - | - |
| 1998 | 55% | 101% | - | - |
| 1997 | 52.6% | 99.3% | - | - |
| 1996 | 53.2% | 100.3% | - | - |
| 1995 | 52.8% | 102.3% | - | - |
| 1994 | 41.7% | 110.2% | - | - |
| 1993 | 42.2% | 118.3% | - | - |
| 1992 | 44.1% | 119.6% | - | - |
| 1991 | 34.4% | 123.7% | - | - |
| 1990 | 46.8% | 138.3% | - | - |
| 1989 | 47.5% | 147.4% | - | - |
| 1988 | 46.5% | 145.4% | - | - |
| 1987 | 52.8% | 143.2% | - | - |
| 1986 | 55.7% | 162.5% | - | - |
| 1985 | 65.2% | 199% | - | - |
| 1984 | - | 284% | - | - |
| 1983 | - | 260.5% | - | - |
| 1982 | 69.7% | - | - | - |
| 1981 | 71.8% | - | - | - |
| 1980 | 69.4% | 154.3% | - | - |
| 1979 | 70.1% | 155.5% | - | - |
| 1978 | 62.2% | 133.6% | - | - |
| 1977 | 69.1% | 142% | - | - |
| 1976 | 66.3% | 97.4% | - | - |
| 1975 | 62% | 85.1% | - | - |
| 1974 | - | 79.8% | - | - |
| 1973 | - | 62.1% | - | - |
| 1972 | - | 63.9% | - | - |
| 1971 | - | - | - | - |
| 1970 | 41.6% | - | - | - |
| 1969 | 41.1% | - | - | - |
| 1968 | 39.4% | - | - | - |
| 1967 | 33.9% | - | - | - |
| 1966 | 29.6% | - | - | - |
| 1965 | 27.8% | - | - | - |
| 1964 | 28.2% | - | - | - |
| 1963 | 26.9% | - | - | - |
| 1962 | 27.7% | - | - | - |
| 1961 | 30.3% | - | - | - |
| 1960 | 30.4% | - | - | - |
Data sources: International Monetary Fund (IMF) | Fiscal Monitor (2000–2024, retrieved 2026-02-20); International Monetary Fund (IMF) | Public Finances in Modern History (1960–1999, retrieved 2026-02-20).
GeoRank.org/economy/israel/south-sudan | CC BY
In 2024, Israel's government spending was $237B, accounting for 43.8% of its GDP, while South Sudan spent $4.08B, or 18.1% of GDP.
Debt-to-GDP ratio is 67.6% in Israel and 50.7% in South Sudan, ranking 62/185 and 105/185, respectively.
Government deficit by year
| Year | Deficit/surplus, % of GDP | |
|---|---|---|
|
Israel
|
South Sudan
|
|
| 2024 | -8.26% | 11.7% |
| 2023 | -5.06% | 8.04% |
| 2022 | 0.32% | 4.48% |
| 2021 | -3.37% | -9.3% |
| 2020 | -10.7% | -5.5% |
| 2019 | -3.79% | 0.04% |
| 2018 | -3.56% | -1.06% |
| 2017 | -1.13% | 9.56% |
| 2016 | -1.79% | -19.8% |
| 2015 | -1.21% | -16.4% |
| 2014 | -2.29% | -9.07% |
| 2013 | -4.06% | -3.45% |
| 2012 | -4.46% | -14.8% |
| 2011 | -3.43% | 4.57% |
| 2010 | -3.72% | - |
| 2009 | -6.53% | - |
| 2008 | -3.5% | - |
| 2007 | -0.43% | - |
| 2006 | -0.95% | - |
| 2005 | -2.74% | - |
| 2004 | -3.4% | - |
| 2003 | -5.03% | - |
| 2002 | -8.22% | - |
| 2001 | -4.06% | - |
| 2000 | -0.8% | - |
| 1999 | -6.26% | - |
| 1998 | -7.99% | - |
| 1997 | -4.84% | - |
| 1996 | -5.97% | - |
| 1995 | -4.28% | - |
| 1994 | -5.62% | - |
| 1993 | -5.62% | - |
| 1992 | -8% | - |
| 1991 | -7.04% | - |
| 1990 | -9.67% | - |
| 1989 | -9.03% | - |
| 1988 | -7.57% | - |
| 1987 | -7.47% | - |
| 1986 | -7.51% | - |
| 1985 | -14.2% | - |
| 1984 | - | - |
| 1983 | - | - |
| 1982 | -13.8% | - |
| 1981 | -23.5% | - |
| 1980 | -19.6% | - |
| 1979 | -16.7% | - |
| 1978 | -14.7% | - |
| 1977 | -20.3% | - |
| 1976 | -19.4% | - |
| 1975 | -19.6% | - |
| 1974 | - | - |
| 1973 | - | - |
| 1972 | - | - |
| 1971 | - | - |
| 1970 | -16% | - |
| 1969 | -15.3% | - |
| 1968 | -11.7% | - |
| 1967 | -7.68% | - |
| 1966 | -4.35% | - |
| 1965 | -2.72% | - |
| 1964 | -3.65% | - |
| 1963 | -4.41% | - |
| 1962 | -4.09% | - |
| 1961 | -5.86% | - |
| 1960 | -6.62% | - |
| 1959 | -7.23% | - |
| 1958 | -8.31% | - |
| 1957 | -7.17% | - |
| 1956 | -9.3% | - |
| 1955 | -4.3% | - |
| 1954 | -7.84% | - |
| 1953 | -8.32% | - |
| 1952 | -7.19% | - |
| 1951 | -8.13% | - |
| 1950 | -10.7% | - |
Data sources: International Monetary Fund (IMF) | Public Finances in Modern History (1950–1999, retrieved 2026-02-20); International Monetary Fund (IMF) | Fiscal Monitor (2000–2024, retrieved 2026-02-20).
GeoRank.org/economy/israel/south-sudan | CC BY
In 2015, Israel's government deficit, the difference between spending and revenue, was $3.67B, equivalent to 1.21% of GDP. This compares to South Sudan's deficit of $1.97B, or 16.4% of GDP.
Over the past 5 years, Israel recorded a fiscal deficit in 5 of those years, while South Sudan ran a deficit in 4 years. On average, Israel posted an annual deficit equal to 3.09% of GDP, compared to deficit of 7.83% of GDP for South Sudan.
Inflation comparison by year
| Year | Consumer prices inflation | |
|---|---|---|
|
Israel
|
South Sudan
|
|
| 2024 | 3.07% | 91.4% |
| 2023 | 4.23% | 2.38% |
| 2022 | 4.41% | -6.69% |
| 2021 | 1.48% | 10.5% |
| 2020 | -0.58% | 29.7% |
| 2019 | 0.82% | 87.2% |
| 2018 | 0.81% | 83.5% |
| 2017 | 0.25% | 187.9% |
| 2016 | -0.54% | 380% |
| 2015 | -0.62% | 52.8% |
| 2014 | 0.47% | 1.67% |
| 2013 | 1.59% | -0.06% |
| 2012 | 1.68% | 45.5% |
| 2011 | 3.49% | 46.9% |
| 2010 | 2.7% | 1.17% |
| 2009 | 3.37% | 5.01% |
| 2008 | 4.53% | - |
| 2007 | 0.47% | - |
| 2006 | 2.05% | - |
| 2005 | 1.34% | - |
| 2004 | -0.42% | - |
| 2003 | 0.71% | - |
| 2002 | 5.8% | - |
| 2001 | 1.12% | - |
| 2000 | 1.03% | - |
| 1999 | 5.19% | - |
| 1998 | 5.49% | - |
| 1997 | 8.95% | - |
Data sources: World Bank | Economy & Growth (1997–2024, retrieved 2026-04-06).
GeoRank.org/economy/israel/south-sudan | CC BY
Over the past 16 years, Israel has recorded an average annual inflation rate of 1.66%, compared with 63.7% in South Sudan. In 2024, inflation was 3.07% in Israel and 91.4% in South Sudan.
Top exports between countries
|
Israel
|
|
|---|---|
| Export category | Export value |
| Machinery & equipment | $280K |
| Chemicals & pharma | $35K |
| Miscellaneous | $3K |
|
South Sudan
|
|
|---|---|
| Export category | Export value |
| Wood & paper products | $29K |
Balance of trade
|
Israel
|
South Sudan
|
|
|---|---|---|
|
Current account balance
|
$15.5B
2024 |
$578M
2023 |
| Current account balance ranking |
21/190
2024 |
60/190
2023 |
| Current account balance, % of GDP |
+2.86%
2024 |
-4.17%
2015 |
| Goods imports |
$96.3B
2024 |
$2.25B
2023 |
| Goods exports |
$70B
2024 |
$4.01B
2023 |
| Service imports |
$44.4B
2024 |
$2.19B
2023 |
| Service exports |
$83.7B
2024 |
$484M
2023 |
| Imports of goods and services, % of GDP |
26%
2024 |
28.9%
2015 |
| Exports of goods and services, % of GDP |
28.4%
2024 |
36.7%
2015 |
Economic freedom indices
The indices of economic freedom below are issued by the Heritage Foundation. Higher scores indicate stronger economic health.
|
Israel
|
South Sudan
|
|
|---|---|---|
| Economic freedom | 68.4 | 41 |
| Economic freedom ranking | 47/197 | 186/197 |
| Property rights | 73.1 | n/a |
| Government integrity | 66.2 | n/a |
| Judicial effectiveness | 68.1 | n/a |
| Tax burden | 60.2 | n/a |
| Government spending | 52 | n/a |
| Fiscal health | 60.8 | n/a |
| Business freedom | 72.4 | n/a |
| Labor freedom | 56.8 | n/a |
| Monetary freedom | 78.2 | n/a |
| Trade freedom | 82.8 | n/a |
| Investment freedom | 70 | n/a |
| Financial freedom | 80 | n/a |
Other economic metrics
|
Israel
|
South Sudan
|
|
|---|---|---|
| Services, % of GDP |
72.5%
2024 |
56.6%
2015 |
| Industry, % of GDP |
17.3%
2024 |
33.1%
2015 |
| Agriculture, forestry, and fishing, % of GDP |
1.28%
2024 |
10.4%
2015 |
|
GNI, Atlas method
|
$528B
2024 |
$11.7B
2015 |
| GNI per capita, PPP |
$56,790
2024 |
$1,010
2015 |
| Total reserves including gold |
$215B
2024 |
$72.9M
2023 |
| Total reserves ranking |
18/177
2024 |
175/177
2023 |
|
Net foreign direct investment
|
-$4.86B
2024 |
$2.21M
2019 |
|
Net inflows of foreign direct investment
|
$14.8B
2024 |
$83.4M
2024 |
|
Net outflows of foreign direct investment
|
$9.92B
2024 |
$0
2024 |
| Poverty at national poverty lines |
22%
2020 |
66%
2020 |
|
Gross capital formation, % of GDP
|
23.4%
2024 |
5.75%
2015 |
GDP per capita map
Data sources: World Bank | Economy & Growth (1985–2024, retrieved 2026-04-06); U.S. Census Bureau (1985–2024, retrieved 2026-02-08).
GeoRank.org/economy/israel/south-sudan | CC BY
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Data sources:
- World Bank | Economy & Growth (1960–2024, retrieved 2026-04-06)
- International Monetary Fund (IMF) | Fiscal Monitor (2000–2024, retrieved 2026-02-20)
- International Monetary Fund (IMF) | Public Finances in Modern History (1950–1999, retrieved 2026-02-20)
- U.S. Census Bureau (1985–2024, retrieved 2026-02-08)
- The Heritage Foundation | Economic Freedom Index (2026, retrieved 2026-03-09)
- TradeMap (2020–2024, retrieved 2026-02-08)
- Central Intelligence Agency (CIA) (2020, retrieved 2026-02-20)
- United Nations | World Population Prospects (2026, retrieved 2026-03-10)
- LivingCost (2026, retrieved 2025-10-14)
Creative Commons Attribution (CC BY) — you’re free to copy, share, remix, adapt, and use even commercially as long as you give appropriate credit and clearly indicate if you made changes. Other sources may be subject to different license terms.
The current account balance is the sum of net trade in goods and services, net earnings from cross-border investments, and net transfer payments. It reflects a country's economic transactions with the rest of the world and is a fundamental component of the balance of payments. A surplus indicates that a country exports more than it imports, while a deficit shows the opposite.
Gross National Income (GNI) measures a country's total income. It encompasses income earned by residents, businesses, and foreign sources, defined as employee compensation and investment profits. GNI adds product taxes not included elsewhere and subtracts subsidies. It accounts for income from residents working abroad but excludes earnings from foreigners within the country.
A negative value for Net Foreign Direct Investment indicates a country is a net receiver of investments, as foreign inflows exceed outflows after Balance of Payments adjustments. A positive value indicates a net provider, with outflows exceeding inflows. Inflows are credits (increasing foreign claims on domestic assets), while outflows are debits (increasing domestic assets abroad).
Foreign direct investment (FDI, net inflows) shows how much capital foreign investors bring into a country after accounting for any funds that flow back in the opposite direction. It represents the net value of overseas companies establishing, expanding, or financing businesses in the reporting country. A positive number means more capital entered the country than was withdrawn, while a negative number means foreign investors pulled out more than they invested.
Foreign direct investment (FDI, net outflows) shows how much capital residents of a country invest abroad after accounting for any funds that flow back in the opposite direction. It represents the net value of domestic companies establishing, expanding, or financing businesses in other countries. A positive number means more capital was invested abroad than withdrawn, while a negative number means residents pulled back more than they invested.
Formerly gross domestic investment, gross capital formation measures the share of a country’s economic output invested in fixed assets, including buildings, machinery, and infrastructure. It indicates how much of the economy is devoted to building productive capacity.