Newsletter : 6fax1108.txt
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Publisher\Editor Don Canaan
Nov. 8, 1996 V4, #204
All the News the Big Guys Missed
Clinton: "I Won't Make Bush's Mistake"
The U.S administration has sent a calming communique to Jerusalem
that they will continue their "no-pressure" policy on Israel. New
York City Councilman Noach Dear told Israel Radio: "Clinton told
me, I will not make the same mistake Bush and Baker made by putting
pressure on Shamir." A poll carried out by the American Jewish
Congress shows that 83% of American Jewry voted for Clinton.
Israel Will Take Part in Regional Economic Conference
By Laurie Kassman (VOA-Cairo)
Israeli Foreign Minister David Levy met Thursday with Egyptian
President Hosni Mubarak to try to ease the tense relations between
the neighbors and to review the stalemated peace process. The
Israeli minister also reaffirmed Israel's participation in a
regional economic conference to be held next week in Cairo.
Levy told reporters both Israel and Egypt want to move the peace
process forward. Egypt has complained about what it sees as
Israeli intransigence in negotiations, especially over the
implementation of interim agreements signed with the Palestinians.
Levy says it is normal in the peace process to have some obstacles
and problems. He did not elaborate on the contents of the
90-minute meeting with Mubarak.
Earlier, he told Israel Radio that Israel will participate in the
third annual Middle East Economic Conference, which aims at
providing an economic dimension to the peace process. But he
expressed hopes it would not turn into an Israel-bashing
U.S. Companies Flood Israel
By Patricia Golan (VOA-Tel Aviv)
The Middle East peace process has prompted dramatic economic growth
in Israel in recent years. And the election last May of Prime
Minister Benjamin Netanyahu, and the resulting slowdown of the
peace process, prompted forecasts by some economic analysts that
the boom would grind to a halt.
McDonald's in Tel Aviv -- the place is mobbed. In the past two
years, U.S.-based companies have invaded Israel with a vengeance.
And not only the fast-food chains -- Blockbuster Video, Tower
Records, Office Depot, Toys-R-Us, and Intel are only a few of
the companies that have invested here.
Before the peace process, Israel was regarded as a kind of leper
state by the world business community. The ratio of foreign
investments in Israel compared to local investments was the
lowest in the world. But since the beginning of the peace
process in 1991, which spelled the end of the Arab boycott, the
economy has been transformed.
In 1995, foreigners put $2.3 billion into the country. That
represents more than 3 percent of Israel's GDP.
Moshe Nachum heads the Foreign Trade Relations Dept. of Israel's
Manufacturers' Association. He says Israel's new investors have
come because of Israeli technology and sophisticated
"Telecommunications, roads, facilities, production possibilities,
lands, incentives, laws, foreign trade, open foreign trade, most of
the benefit that a foreign company can enjoy. You cannot find it
in our neighbors, you find it easily in Israel."
From once being one of the most isolated countries in the world,
Israel has now become attractive to investors because of its
export-driven high-tech industries and an increasingly prosperous,
consumer-oriented population. And although it is a very small
market, multinational companies like Kimberly-Clark, Unilever, and
Nestles', which recently bought a large chunk of the Israeli Osem
Food Co., see Israel and the Middle East as an area of great
Economist Gil Feiler heads an Israeli company which brokers
joint-ventures in Arab countries. He says Israel is fast becoming
a regional logistical center for multi-nationals.
"Do you think that Nestle bought shares in Osem to compete only for
the Israeli market? No. They saw the possibilities in the Middle
East, the Middle East is a huge business opportunities place."
Fueling all this activity has been the peace process. The slow
down of that process since the election of Netanyahu, and last
month's explosion of violence between Palestinian and Israeli
soldiers, has led to forecasts of a fall-off in potential foreign
investments. Several large investment houses with branches in
Israel say the turmoil has produced a crisis of confidence in
Israel's economic future.
Before the election in May, Israel's top businessmen warned that
the economic bubble would burst if Labor's Shimon Peres, who
championed the peace process, was not elected. When Netanyahu's
new and inexperienced government failed to announce a clear
strategy on its promise to privatize industries, and again after
September's bloodshed, analysts and businessmen warned of serious
Last month, Netanyahu warned Israel's economy is likely to slow in
the next year and that the period of high living is over. But
unless the peace and the economy really crash, it appears that
foreign investors are in Israel for the duration.
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