ECONOMIC SURVEY
2 September 1996
(COMMUNICATED BY GPO ECONOMICS DESK)
MACRO-ECONOMIC SECTOR:
* INDUSTRIAL EXPORTS RISE 9.3% DURING JUNE-JULY 1996
Israel's industrial exports rose by 9.3% during June-July, as compared to
the same period in 1995, the Central Bureau of Statistics reported. Total
exports, excluding diamonds, rose by 10.1%, while total imports (excluding
diamonds, fuel, planes, and ships) rose by 21.4%. Imports of consumer
goods rose by 20% during this period, as compared to the corresponding
period in 1995. The import of production inputs continued to rise at an
annual rate of 4% during the two months, as it had since the beginning of
the year. Industrial production continued to rise at an annual rate of
4-5%, while the output of heavy industry metal, machinery, and
transportation grew at an annual rate of 9%; the electronics and
electricity sectors grew at an annual rate of 6%; the food and
construction industries showed no change; and of the light industries
clothing, textiles, leather, and paper declined.
Central Bureau of Statistics - David Neumann, 972-2-6553400
* FOREIGN CURRENCY RESERVES INCREASE BY $600 MILLION IN AUGUST.
Israel's foreign currency reserves rose by $600 million at the end of
August, to $9.52 billion, compared to July, the Bank of Israel reported.
The central bank reported that the increase came primarily from government
transfers of $920 million from abroad, primarily from the raising of funds
within the framework of the U.S. loan guarantees.
Bank of Israel - Ohad Bar-Efrat, 972-2-6552712
GOVERNMENT SECTOR:
* GOVERNMENT BUDGET DEFICIT REACHES OVER NIS 2 BILLION IN AUGUST.
The government's budget deficit for August was NIS 2.08 billion,
increasing the government's total budget deficit for the first eight
months of 1996 to NIS 8.6 billion, the Finance Ministry reported. In July,
the budget deficit was NIS 879 million, while in June the deficit figure
was NIS 2.45 billion.
Finance Ministry - Eli Yosef, 972-2-317201
* EUROBOND UNDERWRITERS TO COMPLETE FRAMEWORK FOR ISRAELI OFFERING.
The agreement enabling Israel to raise $750 million on the Eurobond market
will be completed and signed next week, the Finance Ministry announced.
The lead underwriter will be Merrill Lynch International, with additional
underwriting by Goldman Sachs International, Morgan Stanley International,
SBC Warburg, UBS, Daiwa Europe, and Deutsche Morgan Grenfell. Israel plans
to raise $200 million on the Eurobond market in 1996.
Finance Ministry - Eli Yosef, 972-2-317201
* PRIME MINISTER NETANYAHU MEETS WITH EXECUTIVES FROM AUSTRALIA'S PIONEER
INTERNATIONAL.
Prime Minister Benjamin Netanyahu met with the chairman and members of the
board of Pioneer International from Australia, one of the world's largest
suppliers of raw materials to the construction industry. During the
meeting, the Prime Minister thanked the executives for their further
investments in Pioneer (Israel) and encouraged them to make additional
investments in the region, specifically in Jordan.
Prime Minister's Office - Shai Bazak, 972-2-705465
* INDUSTRY AND TRADE MINISTER SHARANSKY TO HEAD GROUP DEALING WITH JOINT
INDUSTRIAL PARKS WITH PALESTINIAN AUTHORITY.
Industry and Trade Minister Natan Sharansky will lead the governmental
group dealing with the issues surrounding the creation of joint industrial
parks with the Palestinian Authority. On 02.09.96, Sharansky held a
meeting with the directors-general of the Foreign, Finance, and Industry
and Trade ministries in which it was decided that two steering committees
would be established one to deal with legal issues, and the second
concerning security issues and the transfer of workers and raw materials.
Industry and Trade Ministry - Haya Peri, 972-2-220340
PRIVATE SECTOR:
* CONTROLLING INTEREST IN INVESTMENT COMPANY OF BANK HAPOALIM SOLD TO
DOVRAT-SHREM INVESTMENTS.
Bank Hapoalim sold a controlling interest (24%) in the Investment Company
of Bank Hapoalim to a group of investors led by Dovrat-Shrem Investments
on 29.08.96. The Dovrat-Shrem group paid $66.5 million for its interest in
the company, creating a total corporate value of $277 million, while its
shares have a current market value of $154 million. The Investment Company
holds shares in Teledata, Hazorea Seeds, Orlite, MATAV Cable TV, and
Teldor Computers.
Bank Hapoalim - Sharon Geffen, 972-3-5674379
* BANK LEUMI MAINTAINS CONTROL OVER AFRICA-ISRAEL IN EQUITY FIGHT.
On 29.08.96, Bank Leumi purchased an additional 5% of the shares, from an
outside source, in its subsidiary Africa-Israel, increasing its holdings
to 65% This was done in order to prevent the Zisser-Wertheim group from
gaining control of sufficient Africa-Israel equity to prevent the sale of
a controlling interest in Migdal (an Africa-Israel subsidiary) to the
Italian insurance company Generali. Bank Leumi paid approximately NIS 70
million for the shares. The Zisser-Wertheim group (led by developer Motti
Zisser and Eitan Wertheim of Iscar Industries) is participating in a
tender to acquire a controlling interest in Africa-Israel because Bank
Leumi is required by new legislation to reduce its holdings in its
non-financial enterprises. (Globes, 29.08.96, p.1,33; Ma'ariv, 30.08.96,
p.A11)