ECONOMIC SURVEY - 28-Dec-94

28 December 1994

(COMMUNICATED BY GPO ECONOMICS DESK)

COMMUNICATIONS SECTOR:

* FOREIGN CONCERNS ALLOWED TO BID FOR INTERNATIONAL PHONE CALL OPERATOR TO COMPETE WITH BEZEQ.
The Communications Ministry will allow foreign concerns to enter the bidding for operating the international call concession to compete against Bezeq. The concerns are expected to join with local firms in creating groups that will compete for the concession. A number of groups have already begun forming. These include America's Sprint together with Clal, British Telecom with Darcom and Tadiran Telecommunications, and Britian's Cables and Wireless with Aurec. "Globes" (23.12.94).

* CELLCOM, THE SECOND CELLULAR TELEPHONE OPERATOR BEGINS OPERATIONS.
Cellcom, the country's second cellular telephone operator, began operating yesterday (27.12.94). The company, owned by America's BellSouth, the Safra Brothers international investors, Discount Investments, and Israel Aircraft Industries, only services the Tel Aviv area. The company has scheduled service to the Haifa and Jerusalem areas at the end of February 1995. It is competing against Pelephone, a company jointly owned by Motorola Israel and Bezeq.
Cellcom - Oren Most, (09)-639100

PEACE ECONOMY:

* ISRAELI FIRMS WILL BE ALLOWED TO PARTICIPATE IN UNITED NATIONS INDUSTRIAL DEVELOPMENT ORGANIZATION PROJECTS IN 1995.
Earlier this month Industry and Trade Minister Micha Harish was informed by UNIDO's Director General, Mauricio De Maria I Kampas, that Israeli firms will be able to participate in regional industrial development projects. Until now, Israel was not informed of UNIDO projects and therefore Israeli companies could not participate. The Ministry expects that Israeli firms will be eligible to participate in some 500 projects during 1995.
Center for Business Development - Noah Shani, (02)-220601

* JORDAN HOLDING BACK ON ECONOMIC ACCORDS WITH ISRAEL.
Jordan is holding back on its economic negotiations with Israel and public complaints by Jordanian leaders are unfounded, according to Zohar Peri, Director of the Ministry of Industry and Trade's Trade Administration. Peri said that the Jordanians have put tourism interests ahead of commercial trade and therefore have no reason to complain about slower negotiations on trade issues. Peri said that Jordan needs to accept certain principles, such as cessation of the Boycott, which Israel uses as bases for mutual trade. Israel will issue trade licenses to Jordanian firms as soon as Jordan does the same for Israeli firms, commented Peri.
Industry and Trade Ministry - Avital Bar, (02)-220340

GOVERNMENT SECTOR:

ALL DUTIES ON US GOODS TO BE ELIMINATED ON 1.1.95.
On 1.1.95 all duties on US imported goods will be eliminated in accordance with the Free Trade Agreement signed between Israel and the US in 1985. This move represents the final stage of the agreement and includes consumer products like textiles, shoes, and appliances as well as food products like flour, dairy products, and canned goods.
Finance Ministry - Irit Lev-Zarhia, (02)-703450

* GATT URUGUAY ROUND AGREEMENT EXPECTED TO BE APPROVED BY GOVERNMENT ON 2.1.95.
Industry and Trade Minister Micha Harish announced on 27.12.94 that he will bring the GATT Treaty before the Government for approval on 2.1.95. Harish said he also does not expect the Treaty will have any trouble passing the Knesset because for the past two months no Knesset member has expressed complaints about the Treaty. Harish said he expected GATT to provide Israel with a major advantage in penetrating Asian markets and in exporting to countries currently undergoing recession.
Industry and Trade Ministry - Avital Bar, (02)-220340

TOURISM:

* TOURISM MINISTRY TO ASSIST HOTELS IN EASTERN PARTS OF JERUSALEM.
In a tour of hotels in the eastern parts of Jerusalem, Tourism Minister Uzi Baram told Marouan Amad, Chairman of the eastern Jerusalem Hotel Association, that the Ministry would assist in building 1,500 new hotel rooms in that part of the city. Currently there are 1,800 hotel rooms in the eastern part of Jerusalem. Baram told Amad that the Ministry would assist the hotels according to the same criterion it uses for all hotels. Baram added that there is a lack of hotel rooms throughout Jerusalem, which will need to add some 10,000 rooms by the year 2000.
Tourism Ministry - Orly Doron, (02)-754967

DELEGATIONS:

* VIETNAMESE ECONOMIC DELEGATION VISITING THIS WEEK.
A delegation of government and business leaders from Vietnam, led by the Deputy Light Industry Minister, is in Israel this week to explore business and cooperation opportunities. The group is looking to interest Israeli companies in investing in Vietnam and will participate in seminars, visit kibbutz industries, Israel Aircraft Industries, and various food industry plants.
Foreign Ministry -