and without applying an income test for welfare entitlement. the new policy of reducing poverty will have to target the poorest and least empowered population, and let them have a dominant role in shaping their future. to evaluate the progress we are making in poverty reduction we add to the traditional relative definition of the poverty line a need - based ( absolute ) definition of poverty. once we have a meaningful and measurable target, we will be able to make our policy more effective : to introduce quantitative indicators for follow - up, define legislative measures and budgetary instruments, determine accountability for policy implementation and to make sure that full transparency of the policy making and implementation is in place. mr. chairman, the dc communique published yesterday stated : today we renewed our commitment to achieve the millennium development goals and to continue our work on implementing the strategies, partnerships and actions agreed in doha, monterrey and johannesburg. israel has been, and will continue to be, a firm supporter of this worldwide effort to reduce poverty. finally, ladies and gentlemen, i would like to extend special thanks to the government and people of the united arab emirates for their warm hospitality to all the participants of our annual meeting and for their generous assistance to the efficient organization of the meeting. thank you mr. chairman.

itself is lower than it was in 2003, although the cyclically adjusted deficit is close to 4 percent – higher than it was in 2003. since 2007, when the actual deficit was almost zero, the deficit has grown during the crisis, declined somewhat in 2010, and since then has not declined. the result is that we have a deficit of about 4 percent in a situation of almost full employment. i feel very uneasy with this kind of deficit in the current situation, since if the economy enters a recession – a scenario which we must take into account – the deficit will grow, and it will be harder to deal with it. the debt - to - gdp ratio declined from a level of almost 300 percent of gdp prior to the stabilization plan, climbed slightly to a level of about 100 percent during the recession at the beginning of the 2000s, and continued to decline since then to a level of 74 percent today. compared to other countries, we have greatly improved in this parameter due to an increase in the debt levels of many countries as a result of the crisis, but it is very important for the state of israel that the debt to gdp ratio be low. we are exposed much more than other countries to geopolitical risks, and if god forbid we find ourselves one day in a conflict with our neighbors, near or far, it is important that we not come into it with this kind of debt ratio. it is very important, therefore, to continue reducing the debt to gdp ratio. in 2012, the government adjusted the deficit path such that the deficit targets would be reduced more slowly than planned beforehand. in practice, if we grow at an average rate of bis central bankers ’ speeches 3. 75 percent per year, the deficit will decline even more slowly than the path decided upon by the government, based on the existing tax rates in the existing legislation – that is, even taking into account the increase in the vat and direct tax rates recently enacted. according to this estimation by the bank of israel, the deficit in the coming year will apparently be 3. 5 percent, and will reach a level of 2 percent only in the year 2020. according to this projection, debt will also decline more slowly than the government estimated when setting the legislation. the fiscal rule which guides our actions is the result of a joint effort by the ministry of finance, the prime minister ’ s office, and the bank of israel. it is a relatively simple rule that can be easily explained to the public. we know that the expenses