ECONOMIC SURVEY - 06-May-98

6 May 1998

(Communicated by GPO Economics Desk)

MACRO-ECONOMIC SECTOR:

* FOREIGN INVESTORS HOLD 13.7% OF ALL SHARES ON TEL AVIV STOCK EXCHANGE
Foreign investors held 13.7% of all shares traded on the Tel Aviv Stock Exchange (TASE) at the end of February 1998, the Bank of Israel reported. Their holdings are slightly down from January (13.9%) though higher than at the end of December 1997 (13.5%), or at any time in 1997. Foreign holdings of private tradable bonds remained stable at 0.3% in February, as were foreign holdings in the total tradable bond market at 0.6%.
(www.bankisrael.gov.il)
Bank of Israel - Gabi Fishman, 972-2-6552712

* ECONOMIC GROWTH TO FALL TO 1-2% IN 1998
Israel's economic growth will slow to between 1-2% in 1998, according to Finance Minister Ya'acov Ne'eman. In order to encourage more growth and lower unemployment, the Finance Ministry presented an economic initiatives plan to the cabinet for approval. The plan includes speeding up infrastructure investments and increasing the government's infrastructure investments to NIS 2.2 billion, but without breaking the budget deficit level of 2.4%, ministry officials said. Infrastructure projects that will increase future productivity such as railway and road construction will be at the top of the ministry's list.
(www.mof.gov.il)
Finance Ministry - Eli Yosef, 972-2-5317201

* FOREIGN CURRENCY RESERVES UP TO $21.81 BILLION IN APRIL
Israel's foreign currency reserves rose by $214 million to reach $21.81 billion at the end of April 1998, the Bank of Israel reported. The rise was primarily due to revenues taken by the central bank on exchange rate differentials due to the dollar's weakness during the month, the bank said.
(www.bankisrael.gov.il)
Bank of Israel - Gabi Fishman, 972-2-6552712

* DURABLE CONSUMER GOODS IMPORTS UP FOR FIRST FOUR MONTHS OF 1998
Imports of durable consumer goods rose during the first four months of 1998, the Finance Ministry announced. Imports of cars rose by 1.4%, refrigerators by 12.3% (despite a drop in April of 1.1%), washing machines by 1.6%, televisions by 13.5%, VCRs by 23.5%, and dish washers by 1.6%

(despite a drop of 13.9% during April).
(www.mof.gov.il)
Finance Ministry - Eli Yosef, 972-2-5317201

GOVERNMENT SECTOR

* ISRAEL BECOMES DONOR COUNTRY TO WORLD BANK'S INTERNATIONAL DEVELOPMENT ASSOCIATION
Israel will contribute $1 million in order to become a donor nation to the World Bank's International Development Association (IDA) whose role is to provide international financing to approximately 80 of the world's poorer countries which have problems receiving funding. With government participation, Israeli firms will be able to participate in the IDA's international tenders worth a total of $6 billion.
(www.mof.gov.il)
Finance Ministry - Eli Yosef, 972-2-5317201

PRIVATE SECTOR:

* CISCO SYSTEMS ACQUIRES ISRAELI FIRM FOR $50 MILLION.
Computer networking giant Cisco Systems announced on 4 May, 1998 that it had signed a definitive agreement to acquire Class Data Systems of Ra'anana for $50 million. Class Data is a privately held company specializing in internet protocol network management software. This is Cisco's first acquisition in Israel.
(www.classdata.com)
Class Data Systems - Steve Woo, (US) 408-8733080

DEFENSE INDUSTRIES SECTOR:

* 16 FIRMS TO PARTICIPATE IN FRENCH EUROSATORY EXHIBITION
16 Israeli firms are scheduled to participate in the "Eurosatory" exhibition, the defense and security exhibition for land forces to be held in La Bourget, France during the first week of June. The firms include Rafael, RSL, Tadiran, Elbit, Nazareth Automotive Industries, El-Op, Israel Aircraft Industries, TAAS (formerly IMI), Reshef Technologies and Azimuth among others.
(www.mod.gov.il)
Ministry of Defense - Dan Weinreich, 972-3-6975546

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