ECONOMIC SURVEY - 09-Nov-95

(COMMUNICATED BY GPO ECONOMICS DESK) 9 November 1995

FOREIGN TRADE:

* INTEL TO INVEST $1.6 BILLION IN CONSTRUCTION OF MANUFACTURING FACILITY IN KIRYAT GAT.
Intel, the multinational producer of semiconductor chips, has announced that it reached an agreement with the Israeli Government to build a new plant in Kiryat Gat. A total of $1.6 billion will be invested in the plant's construction, with the Government providing approximately $600 million in tax grants and Intel providing the remainder of the investment. The new plant will manufacture Flash Memory products used in laptop and other personal computer equipment. Approximately 2,000 workers will be employed during the construction. The plant itself at full capacity is expected to employ 1,500 direct employees. The first products are expected to leave the factory in 1998. Currently, the Finance and Industry and Trade Ministries are negotiating as to the procedures and timing of providing the tax grants to Intel.
Intel - Maxine Fassberg, 972-2-897929

* MOTOROLA AND DELCO EXAMINING LARGE INVESTMENTS IN ISRAEL.
Both Motorola, the international telecommunications concern, and Delco, a vehicle parts manufacturer subsidiary of General Motors, have reported that they are investigating the possibility of making large-scale investments in Israel. In conversations with Finance Minister Avraham Shohat on Thursday, 09.11.95, representatives of both concerns said that they would make a positive recommendation concerning investment in Israel. Motorola's investment would be for the construction of a $1 billion semiconductor production facility, in addition to their cellular telephone production plant in Arad.
Finance Ministry - Eli Yosef, 972-2-317201

* GREECE AND ISRAEL TO SIGN DOUBLE TAXATION PREVENTION TREATY.
Greece's Deputy National Economic Minister, Ioannis Anthopollos, is now visiting Israel in order to sign a treaty to prevent double taxation between citizens and companies operating in both countries, and to propose cooperation in opening commerce with the Balkan nations. During his visit, he will meet with officials from the Foreign and Industry and Trade ministries.
Industry and Trade Ministry - Ayal Fabian, 972-2-220389

* FIRST VISIT BY NORTHERN IRELAND TRADE MISSION.
In late October, the British Industrial Development Board supported the visit of a group of 12 Northern Ireland business people to Israel. The group first participated in the Medpartenariat Conference in Jerusalem before moving to Tel Aviv for a series of meetings with possible business partners.
British Embassy - Tony Connolly, 972-3-5249171

* GERMAN ECONOMICS MINISTER VISITS.
In early November, German Economics Minister Dr. Guenter Rexrodt made a working visit to Israel. During his visit, he met with the Finance, Economics and Planning, Industry and Trade, and Foreign Affairs ministers as well as dedicating the Israel-Germany Bilateral Trade Office. Industry and Trade Minister Harish proposed that Israeli firms be given greater access to German industrial R&D projects, and suggested that due to technicalities in German law, funding for these projects be directed through the governments of the various Federal States rather than through the national government.
Foreign Ministry - Danny Shek, 972-2-303343

* CZECH TRANSPORTATION FIRM INTERESTED IN ACTIVITIES IN ISRAEL.
Miroslav Gregr, managing director of the Czech transportation and heavy equipment manufacturing firm Desta, told Industry and Trade Ministry Director-General Yossi Snir that his firm is interested in trading with Israel. Desta is looking at manufacturing and joint ventures on information exchange with Israeli firms. During Gregr's visit, the founding of an Israel-Czech Chamber of Commerce was discussed.
Industry and Trade Ministry - Ayal Fabian, 972-2-220389

* EUROPEAN INVESTMENT BANK MAKES ECU 33 MILLION LOAN TO INDUSTRIAL SECTOR.
The European Investment Bank (EIB), the European Union's long-term financing institution, has granted a loan of ECU 33 million ($43.6 million) to the Industrial Development Bank of Israel (IDBI). The loan is to be used to fund small- and medium-sized Israeli businesses in the industrial, tourism, and services sector. With this loan, the EIB has granted a total of ECU 167 million in eight global loans to the IDBI.
European Union - David Kriss, 972-3-6964166

* IMPROVED TRADE RELATIONS WITH SOUTH KOREA.
From 6-9 September, South Korea is sponsoring its first ever trade fair in Israel at the Tel Aviv Fairgrounds for South Korean firms and their Israeli representatives in order to show their wares to Israelis. Some of the largest names in Korean industry are being represented, including Daewoo, Haitai, and Hyosung. In 1994, Israeli exports to South Korea were $147.9 million, while Israeli imports from South Korea were $282.4 million. Last week, several leading South Korean businessmen arrived for a visit and discussions with the Manufacturers Association and the Israel Export Institute. Executives from Samsung, Hyundai, Daewoo, and members of the South Korean Industrial Federation were among the visitors.
Korean Embassy - Commercial Section, 972-3-6396488