ECONOMIC SURVEY - 23-Nov-95

(COMMUNICATED BY GPO ECONOMICS DESK) 23 November 1995

MACRO-ECONOMIC SECTOR:

* 1% SLOWDOWN IN ECONOMIC ACTIVITY IN AUGUST-OCTOBER
A 1% slowdown in economic activity during the period of August-October compared to the May-July period was reported by the Federation of Israeli Chambers of Commerce. The FICC reported that its survey of members showed that the drop was primarily caused by firms supplying industrial input products. The sectors revolving around consumer goods reported a growth in activity.
Federation of Israeli Chambers of Commerce - Linda Shimon, 972-3-5631010

* MANUFACTURERS' ASSOCIATION INDUSTRIAL GROWTH TO SLOW DOWN IN FOURTH QUARTER.
Industrial growth will tail off in the fourth quarter, according to a survey of 200 industrial concerns by the Manufacturers Association. During the third quarter, these concerns reported a period of growth, mostly due to increased activity in the local market, though they did report a slow down in export activity, especially metals manufacturers. 53% of the firms reported stronger local sales during the third quarter, while only 36% believe their local sales will be stronger in the fourth quarter. Exporters replied that they foresee stronger export sales in the fourth quarter compared to the third quarter.
Israel Manufacturers Association - Oded Ben Ami, 972-3-5198800

* INFLATION UP 1% IN OCTOBER.
October's rate of inflation rose by 1%, the Central Bureau of Statistics announced. For the first 10 months of 1995, the inflation rate is 6.1%; 7.8% without the fruit and vegetable index. The primary reason for inflation's rise during the month were increases in fruits and vegetables

(up 3.1%), and clothing and shoes (up 5.6%).
Central Bureau of Statistics - David Neumann, 972-2-6553400

AGRICULTURE:

* INDUSTRY AND TRADE MINISTER HARISH MEETS WITH U.S. SECRETARY OF AGRICULTURE DAN GLICKMAN.
Industry and Trade Minister Micha Harish and U.S. Secretary of Agriculture Dan Glickman met this week to negotiate further refinements in the Free Trade Zone Accord's agricultural sections. The major points separating the two sides concern the import of U.S. frozen and processed food products, and the amount of customs duties on these products. Harish said that he was willing to accede to most of the American's positions as long as the interests of Israeli consumers were protected. Israel is scheduled to further open its agricultural imports on 15.12.95, in accordance with the most recent GATT agreement.
Industry and Trade Ministry - Ayal Fabian, 972-2-220389

FOREIGN TRADE:

* 12 ISRAELI FIRMS EXHIBIT EQUIPMENT FOR USE BY U.N. PEACE KEEPING FORCES.
12 Israeli firms exhibited equipment for use by the United Nation's Peacekeeping Forces last week. Israel's booth at the exhibition, which took place in Washington D.C., displayed equipment from companies in the telecommunications, police equipment, electronics and service sectors. Israel's participation was organized by SIBAT, the Defense Ministry's export services arm. (Globes, 16.11.95, p.14)

* ELECTRONICS INDUSTRY'S EXPORTS GROW 15% IN 1995 TO $4.3 BILLION.
The electronics industry reported that its exports have grown by 15% compared to 1994 and will reach $4.3 billion at the end of 1995. The civilian electronics component in exports showed 20% growth over 1994 to reach $3.37 billion, or 78% of the sector's entire exports. Defense exports fell by 1% to $930 million. Total sales for the sector are $5.8 billion in 1995. Sales per employee was $147,000 for the approximately 40,000 workers.
Manufacturers Association - Oded Ben Ami, 972-3-5198800

* SIEMENS TO ESTABLISH R&D FACILITY HERE.
Germany's electronics giant Siemens has received approved enterprise status from the Industry and Trade Ministry's Investment Center to open an R&D center for developing voice and video components, the ministry reported. The center will be a joint venture with Nisko, a manufacturer of electronics and electricity infrastructure products. This is Siemen's second investment, in Israel and follows the company's acquisition of the high tech firm Ornet.
Industry and Trade Ministry - Ayal Fabian, 972-2-220389

* BOSTON SCIENTIFIC ACQUIRES STRATEGIC INTEREST IN MEDINOL.
Boston Scientific, a publicly-traded U.S. corporation, concluded an agreement in mid-November to acquire approximately 30% of the medical high tech firm, Medinol, for between $100-80 million. Less than a month earlier, the media speculated that Johnson & Johnson had signed an agreement to acquire Tel Aviv-based Medinol for $360 million, but negotiations were inconclusive. (Globes, 15.11.95, p.1)

* AFRICA-ISRAEL CHAMBER OF COMMERCE FOUNDED.
On 15.11.95, the founding meeting to establish the Africa-Israel Chamber of Commerce took place with the participation of Yossi Beilin, at the time Economics and Planning Minister. The chamber's founding is a result of the resumption of diplomatic relations by most of the African countries that had severed relations in the 1970's. The chamber will deal with all of a sub-Saharan Africa excluding South Africa, which is dealt with by the Israel-South Africa Chamber of Commerce.
Industry and Trade Ministry - Ayal Fabian, 972-2-220389

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