Industries recuperate on their own?

However, some analysts said the comeback of Israel's high-tech sector had little to do with government assistance.

"I would say that the government did nothing for the high-tech sector or emerging industries, which struggled to hold on during the crisis," Shlomo Maoz told Xinhua. He is the chief economist of Excellence Nessuah, an Israel-based investment house.

"Their only positive contribution is the proposed annual one percent cut in corporate taxes, which dropped to 25 percent this year and are supposed to reach 22 percent," Maoz said, "otherwise everything continues along the same lines vis-a-vis investment in R&D and incubators."

He noted that the government's involvement with the Israeli success story was something of the past. "Their initial support was of significant importance, but now the industry mostly fends for itself with some ongoing assistance from the government."

Maoz noted that the Bank of Israel's intervention in the foreign exchange market was, however, essential to the economy's turn-around. In order to curb the shekel's rapid appreciation against the U.S. dollar, Israel's central bank increased its foreign currency reserves from 28 billion U.S. dollars at the beginning of the crisis to 63 billion U.S. dollars via daily dollar purchases.

"This helped keep the market profitable as it alleviated pressure on Israeli exporters whose products would otherwise be too expensive," Maoz said.

"In order to survive, many companies tried to avoid firing employees by cutting hours instead, giving their employees part- time jobs and sending people on vacation among others. They kept employees on as long as possible for when the economy would rebound," Maoz said.