ECONOMIC SURVEY
(COMMUNICATED BY GPO ECONOMICS DESK)
9 January 1995
PEACE ECONOMY:
* JORDAN-ISRAEL TRADE TALKS OPEN NEW ROUND.
Jordanian and Israeli officials opened a new round of economic and trade
talks on 8.1.95. The Industry and Trade Ministry reported that the goal of
the current round of talks is to come to an agreement on a Most Favored
Nation Treaty. The two sides have agreed to formulate a "simple" MFN
treaty, without complicated or problematic clauses, in order to reach an
agreement as soon as possible, before the 10.5.95 deadline the parties
set. Last week, Jordan's Trade Minister told her Israeli counterparts that
Jordanian companies now have Government approval to export goods to
Israel. This round of talks is taking place at Dir-Ala, in Jordan, while
talks on standards are taking place on the Jordanian side of the Adam
Bridge.
Industry and Trade Ministry - Avital Bar, (02)-220340
* ISRAELI, JORDANIAN, AND PALESTINIAN CHAMBERS OF COMMERCE TO ESTABLISH
COMMITTEE TO ENSURE COOPERATION.
Danny Gillerman, President of the Federation of Israeli Chambers of
Commerce, reported that during his trip to Jordan last week he met with
representatives of both the Jordanian Chamber of Commerce and the
Palestinian Autonomy, and reached an agreement on establishing a joint
committee to deal with issues of cooperation. In a letter to the Prime
Minister yesterday, 8.1.95, Gillerman asked the PM to grant MFN status to
Jordan unilaterally because Israel holds a natural economic advantage.
Federation of Israeli Chambers of Commerce - Sara Lipkin, (03)-5631010
PRIVATIZATION:
* FINANCE AND TRANSPORTATION MINISTRIES REJECT BIDS FOR PRIVATIZING ISRAEL
SHIPYARDS.
Avraham Shohat, Finance Minister, and Israel Kessar, Transportation
Minister, rejected three bids in the tender for privatizing Israel
Shipyards saying that the bids were too low. The highest bid was
approximately $9 million. Bidders for the financially troubled shipbiulder
and its land included a group of foreign investors, and two groups
consisting of local investors. The Ministries announced that a number of
alternative measures are currently being considered for Israel Shipyards
including putting the company under the authority of the Ports and Railway
Authority or the Airports Authority, breaking up the company, or selling
the company to a fourth group of investors who bid for the company only
after the close of the tender. The fourth group, whose bid is reportedly
twice as high as that of the group with the current highest bid, is
reportedly led by Israel Shipyard's current Managing Director Ze'ev Almog,
according to the Hebrew press.
Finance Ministry - Eli Yosef, (02)-317201
FOREIGN TRADE:
* VIETNAM - A TARGET FOR ISRAELI MEDICAL SUPPLIES
The Israel Export Institute reported that it has analyzed the Vietnamese
market for the potential export of Israeli goods and has concluded that
Israel has an advantage in the medical supplies sector. Therefore, the
Export Institute will be holding a seminar with Vietnamese health
officials in early February 1995 to introduce them to Israeli
manufacturers of medical goods and supplies. According to Mira Richman,
Director of the Electronics and Medical Supplies Division in the
Institute, World Bank financing and internal reforms in the Vietnamese
health sector have opened opportunities for Israeli medical product
manufacturers.
Israel Export Institute - Mira Richman, (03)-5142890
MACRO-ECONOMIC SECTOR:
*BANK OF ISRAEL TO BUY LONG TERM BONDS FROM PUBLIC.
The Bank of Israel announced that for the first time it will buy bonds
from the public, on 9.1.95, in order to inject cash into the economy.
According to its announcement, the Bank will buy up to NIS 25 million in
bonds from the public. The bank in pursuing this new monetary policy, will
only buy bonds, at most, once every month beginning in 1995. This approach
differs from its regular method of introducing cash into the economy
through monetary tenders to the banks.
Bank of Israel - Ohad Bar-Efrat, (02)-552712
TOURISM:
* RECORD TOURISM YEAR.
The Central Bureau of Statistics reported that more than 1.84 million
tourists arrived in Israel in 1994, an 11 percent increase over 1993,
which itself was a record year. According to the CBS, the number of
tourists arriving by air rose by 9 percent, those arriving by sea fell
slightly, while tourists arriving by land rose by 24 percent. These
figures do not include visits by crew members of ships docked in Israel
including seamen from military vessels of whom there were 330,000
during 1994. 21 percent of all tourists arrived from the USA, 11 percent
from Germany, 10 percent from the UK, and 9 percent from France.
Central Bureau of Statistics - David
Neumann, (02)-553400