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| Israeli
economy faces worse recession since 1948. |
OCCUPIED
JERUSALEM, Feb. 20 (IslamOnline & News Agencies) - Israel is suffering one
of its worst recessions since it came into existence in 1948, a report said
Wednesday.
BBC’s
online news service reported that unemployment in January 2002 rose to over 10%
of the workforce, its highest level ever, and a jump of almost one-fifth since
the beginning of 2001.
Investors
are now pinning their hopes on further cuts in interest rates as the only way to
kickstart once-buoyant growth, said BBC.
The
unemployment figures have come as a particularly bitter blow to Israel, which
has traditionally enjoyed extremely low jobless rates.
The
worst figures are seen in Arab areas: in the town of Kfar Manda, in the Galilee,
joblessness stood at 22%.
Indeed,
the 21 towns with the highest unemployment are all predominantly Arab, and the
worst-hit Jewish town, Ashkelon, has just 10% unemployment. In the Palestinian
territory, unemployment recently hit a high of 26%, the report said.
“In
2001, its economy shrank by 0.5%, with the contraction accelerating towards the
end of the year; during the last three months, gross domestic product was down
7.2% year on year. The year before, by contrast, saw growth of 6.4%,” said the
BBC report.
“According
to a report produced by the Bank of Israel last month, the current spate of
violence between Israelis and Palestinians has cost the economy 13bn shekels [£2bn;
$2.8bn] in lost output, mainly thanks to a sharp drop in tourism revenues.
“And
while the economy has sagged, government expenditure has increasingly been
diverted to the military, spurring an increasingly alarming budget deficit.”
Meanwhile,
the last six days dealt a heavy blow to the Israeli security structure as
consecutive Palestinian strikes were a shock to the Israeli community.
Israeli
official statistics showed that the number of Israelis killed from Thursday,
February 14 to Wednesday, February 20, reached 16, (14 of them from the army).
