ECONOMIC SURVEY - 15-Mar-95

15 March 1995

(COMMUNICATED BY GPO ECONOMICS DESK)

STATISTICS:

* INFLATION RATE UP 0.2% IN FEBRUARY.
February's inflation rate rose by 0.2%, according to the Central Bureau of Statistics. The inflation rate, excluding fruits and vegetables whose inflation rate fell by 6.1%, rose by 0.5%. For the first two months of 1995 the inflation rate has risen 0.3%.
Central Bureau of Statistics - David Neumann, 972-2-553400

* GROSS DOMESTIC PRODUCT INCREASED 33% AND GROSS DOMESTIC PRODUCT PER CAPITA INCREASED BY 12% DURING PAST FIVE YEARS.
The Central Bureau of Statistics released 1994 adjusted economic indicator statistics, on 14.3.95, showing an increase in the GDP of 33% over the past five years, and an increase in the GDP per capita of 12% during the same period. Adjusted figures for 1994, show growth of 7% in the GDP and growth of 8% in the business sector GDP, which excludes public and housing services. During the past five years, business sector GDP has risen by 40%, and exports increased 41%, while imports increased 71%. The gap between imports and exports has led to an increase in the trade balance of payments deficit which in 1989, equalled 6% of the GDP, while in 1994 it equalled 11% of the GDP. Other 1994 figures show that labor productivity fell by 1%, the purchase of durable goods rose by 11%, exports were up by 11%, and civilian imports increased by 13%.
Central Bureau of Statistics - David Neumann, 972-2-553400

* 1994 CURRENT ACCOUNTS BALANCE OF PAYMENT DEFICIT NEARLY DOUBLES TO $2.7 BILLION.
Israel's 1994 current accounts balance of payment deficit nearly doubled to $2.7 billion, an increase from $1.4 billion in 1993, the Central Bureau of Statistics reported. The increase was due primarily to a $3.6 billion increase in imports during the year, the Bureau noted. In order to finance the deficit, the economy increased its holding of foreign capital, so that at the end of 1994, the current accounts foreign debt totalled $3.6 billion, compared to $1.9 billion at the end of 1993.
Central Bureau of Statistics - David Neumann, 972-2-553400

FOREIGN TRADE:

* INDUSTRIAL EXPORTS INCREASE BY 7% TO $2.42 BILLION DURING FIRST TWO MONTHS OF 1995.
The Ministry of Industry and Trade reported that industrial exports rose 7% to $2.42 billion during the first two months of the year. The Ministry reported that this was partially due to an increase of 23.4% in diamond exports which accounted for approximately 30% of all exports. Excluding diamonds, industrial exports rose by 1.1% during the period due to a decrease in exports in the electronics, metals, and machinery sectors. The Ministry reported the drop in exports in these sectors was due to a drop in one-time military exports.
Industry and Trade Ministry - Avital Bar, 972-2-220340

* BRITISH TELECOM TO JOIN GROUP LED BY TADIRAN IN BIDDING FOR INTERNATIONAL PHONE SERVICE TENDER.
British Telecom and Tadiran announced, on 14.3.95, that they would be joining forces to bid on the Communications Ministry's tender for an added operator for international phone calls to be held later this year. The Tadiran consortium also includes two other local firms Darcom and Idan Communications. British Telecom will lead the consortium, holding 30% of its equity, with the remaining three Israeli companies each holding 23.3% of equity in the group. The tender to expand international telephone service is part of a policy to liberalize the communications sector. Currently, Bezeq is the only company providing all aspects of international phone services.
Tadiran - Amiram Fleischer, 972-3-5251115

COMPUTERS:

* HEBREW UNIVERSITY RESEARCHERS DEVELOP MULTI-PROCESSOR PARALLEL SUPER-COMPUTER.
Researchers from Hebrew University's Institute of Computer Science have developed a new multi-purpose parallel supercomputer based on an advanced operating program of work distribution. The advantages of the computer, according to its developers, are its ability to achieve maximum utilization of all of its components working in tandem and its relatively low price: $150,000. It also answers Israel's research and development needs for supercomputers, by eliminating the need to acquire a more expensive computer abroad.
Hebrew University - Prof. Amnon Barak, 972-2-882811

DELEGATIONS:

* ARGENTINE ECONOMIC OFFICIAL VISITS.
Argentina's Under secretary for International Economic Negotiations, Mr. Alfredo Chiaradia, visited Israel from 11-14.3.95 in order to conclude negotiations on an economic cooperation agreement between the two countries. Mr. Chiaradia met with officials in the Foreign, Finance, and Industry and Trade Ministries. The Argentine Minister of Economy is scheduled to visit Israel to sign the treaty in April.
Argentine Embassy - Ambassador Otegui, 972-3-5759173