ECONOMIC SURVEY
17 October 1996
(Communicated by GPO Economics Desk)
MACRO-ECONOMIC SECTOR:
* SEPTEMBER INFLATION INCREASES BY 0.4%.
Inflation rose by 0.4% during September, and has risen by 8.2% since the
beginning of 1996, the Central Bureau of Statistics reported. This is the
lowest increase in a September CPI since 1968. The food index (excluding
fruits and vegetables) rose by 0.5%, while the fruits and vegetables index
rose by 3.0%. The housing index fell by 0.1%, whereas the housing
maintenance index rose by 0.7%. During the month, the furniture index rose
by 0.7%, while the clothing and shoe index fell by 0.9%.
Central Bureau of Statistics - David Neumann, 972-2-6553400
* 1996'S ECONOMIC GROWTH ESTIMATED TO BE 4%.
Growth in the Gross Domestic Product (GDP) is estimated to reach
approximately 4% in 1996, according to initial indicators published by the
Central Bureau of Statistics. This compares to an average annual growth
rate of 7% in 1994 and 1995. GDP per capita is expected to reach just
above $15,000 for the year, and private consumption will rise by 6%,
following increases of 7% and 8% in 1995 and 1994, respectively. Exports,
in fixed prices, are expected to rise by 4%, compared to increases of 11%
to 15% during each of the past four years. Imports are expected to rise by
7-8%, influenced by an increase of 5% in the price of imports, compared to
12% in 1995. Investment in fixed assets is expected to increase by 8%,
similar to the rise in 1995.
Central Bureau of Statistics - David Neumann, 972-2-553400
* BANK OF ISRAEL SURVEY: ECONOMIC ACTIVITY COOLING DOWN.
Israel's economy activity was stable during the last quarter with a number
of sectors showing signs of slowing down, according to the Bank of
Israel's quarterly economic survey. During the quarter, a decrease in
activity was recorded in the construction and hotel sectors, while the
commercial, industrial, transportation and communications sectors showed
stable activity. The industrial sector reported that sales to the local
market were down as has been the case since the beginning of the year -
- while export sales remained stable. The sector's larger corporations
fared better than their smaller- and medium-sized counterparts, the bank
reported.
Bank of Israel - Ohad Bar-Efrat, 972-2-6552712
GOVERNMENT SECTOR:
* ISRAEL AND AUSTRALIA CONSIDERING ESTABLISHMENT OF JOINT RESEARCH AND
DEVELOPMENT VENTURE CAPITAL FUND.
Israel and Australia are examining the possibility of establishing a joint
R&D venture capital fund, according to Industry and Trade Ministry
Director-General Dr. Shuki Gleitman. Gleitman reported that the subject
was brought up during a recent meeting with Australia's Ambassador to
Israel Peter Rodgers and that the two sides decided to actively pursue the
matter. Currently, Israel has joint R&D venture capital funds with the
United States and Canada, and at the end of 1996 it expects to operate one
with Singapore.
Industry and Trade Ministry - Haya Peri, 972-2-220340
FOREIGN TRADE:
* BEZEQ RAISES $150 MILLION FROM INTERNATIONAL BANKING CONSORTIUM.
Bezeq raised $150 million at LIBOR + 0.3% for five years from an
international banking consortium led by Credit Suisse and Sumitomo Bank of
Japan. Other banks participating in the consortium include Canadian
Imperial Bank of Commerce, Bank Hapoalim (Switzerland), and Kredietbank of
Belgium. Earlier this year in March, Bezeq raised a similar loan at an
interest rate of LIBOR + 0.45%.
Bezeq - Ella Bar-Or, 972-2-5395272
* DELEGATION FROM TAIWAN'S INVESTMENT COMPANY CDC VISITS ISRAEL.
A delegation of executives from Taiwan's China Development Corporation
(CDC) visited Israel earlier this month and held meetings with government
officials and private sector companies. CDC, which has investments in
approximately 160 Taiwanese firms, is looking for joint business
opportunities in Israel. During the visit, the delegation visited concerns
in the medical supplies, bio-technology, semi-conductor, ceramics and
pharmaceutical industries.
Center for Business Promotion - Noah Shani, 972-2-861707
PEACE ECONOMICS:
* BANK LEUMI TO TRAIN PALESTINIAN BANK EMPLOYEES; TEL AVIV STOCK EXCHANGE
PLANS TO COOPERATE WITH NEW PALESTINIAN BOURSE.
Bank Leumi announced it will assist in the professional training of
Palestinians who work in banks operating within the Palestinian Authority.
The bank is one of the participants in the Economic Cooperation
Foundation, a joint Israeli-Jordanian-Palestinian effort to improve and
create cooperative ventures in monetary, industrial, commercial and
venture capital fund areas. Bank Leumi's counterparts in the Foundation
include Jordan's Horizon, and Data, a Palestinian concern. At the
Foundation meeting, Prof. Yair Orgler, Chairman of the Tel Aviv Stock
Exchange, reported that the bourse was ready to hold a dialogue and
cooperate with the parties responsible for establishing the Palestinian
bourse as well as with the Jordanian bourse.
Economic Cooperation Foundation - Dr. Ron Pundak, 972-3-6958310
Bank Leumi Ricki Carmi, 972-3-5149404
Tel Aviv Stock Exchange Etti Tuttnaur, 972-3-5677405