Foreign Investments in Israel Shrinking: Bank of Israel
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Foreign Investments in Israel Shrinking - Bank of Israel |
OCCUPIED
JERUSALEM, July 29 (IslamOnline & News Agencies) – In yet
another blow to the Israeli economy, foreign investors withdrew a net
$152 million from Israel in June 2002, according to the monthly report
by the central Bank of Israel. Although the bank did not specify the
reason for the drop, economists said it was a result of the unstable
political situation caused by the deepening Israeli-Palestinian
conflict, the Jerusalem Post reported.
Israel’s
atrocities and war crimes in the West Bank refugee camp of Jenin, and
recently in Gaza have drawn worldwide condemnation and several calls
for boycotting Israel as a terror state.
The
bank report mentioned that in June 2002, foreign resident investments
amounted to $152 million of profit-taking, mostly withdrawals from
deposits, following an ongoing period of decreasing deposits which
started in early 2000 and increased through April of this year, when
it became a redemption trend.
Despite
a net rise in investments in the private sector of $362 million, bank
account withdrawals and the sale of government bonds of more than half
a billion dollars canceled them out. Foreigners invested $1.06 billion
in the first half compared to $4.4 billion in all of 2001 and a record
$11.3 billion in 2000.
Israeli
investments overseas dropped in June by $31 million. Israelis
repatriated $191 million as a result of the sale of bonds worth $493
million and investments in stocks and companies worth $302 million.
Individual
investors sold $40 million worth of foreign currency, while companies
began selling after the second increase of 2 percentage points at the
end of the month after a 1.5 percentage point increase at the
beginning of the month.
A
sharp fall in the foreign residents investment was witnessed as
investments reached the microscopic sum of $31 million in Israel in Q2
2002. This is compared to $1.025 billion in the first quarter of the
year and $4.368 billion in 2001, most of which was invested during the
first half of the year.
The
withdrawal of foreign investments marks a new drop for the already
failing Israeli economy, with inflation, tourism crisis and
unemployment presenting greater problems.
Israel's
cost of living index rose a sharp 1.3 percentage points in June,
pushing the inflation rate to 6.3% since the start of the year, the
official statistics bureau announced Monday, July 29.
It
warned that at the current rate, inflation could reach nine percent
for the year, more than double the treasury's target of 4%.
The
rise in prices was largely due to the devaluation of the shekel, which
has slumped more than 20% against the dollar this year amid the almost
two-year Palestinian Intifada against Israeli occupation. By contrast,
Israel had zero inflation for the whole of 2000, and 2.7 percent in
2001.
Another
report by the central Bank of Israel said that about half of
Israel’s potential work force of 4.8 million aged 15 to 64 did not
work and only 255,000 of them were actively searching for work in the
first quarter of the year. While many developed countries have made
employment reforms, Israel has taken no action, said the report.
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