Oldal 1 [1]
OCR
gp öt XeAcNoe4e for September 19526 REPORT ON ISRALL Located in the middle of a hostile Arab world, Israel both needs the West, for economic reasons, and wishes to spare the Last, in order to safeguard its many correligionaries who still live in that part of our globe. This delicate situation is rendered more difficult still, by sentimental or political attachment which the Israeli populationg, mostly immigrants, keep towards the most different countries and foreign groupsSe Quite recently - as if to make competis tions increasingly acute - Israel has openly entered the list of oil producing countries, in a Near-Kast where that wealth has also become the source of most violent disputes. In the light of fhis highiy explosive situation, a report rec ived from Tel-Aviv seems of greatest actuality. israel today is not an isolated unit: its economic and innprpolitical situation, as it has recently evolved, gains international importancee Eeonomic problems and governmental policies. Iisracl's undeniable economic difficuity boils down to a fundamental cause: its Low productivity and its lagging exports A few weeks ago, the Minister of Trade and Inaustry complained that the country’s total export was amounting to only one fourth of its The government thus decided that drastic measures had to be taken. Their aim would be to encourage export, while discouragéng import and inner comsumption; it would be to stabilize currency and stimulate production, It was hoped that by such drastic measures the desperate financial deadlock could be solved. Up to that point indeed, a most unfavorable commerciel balance and a constant budgetary deficit were only filled by gifts and loans which Israel was receiving, mostly through the Jewish Agency, the Hadassah collections, the United Israel Apreal, the US grants in aid anda the bond drive in America. These gift and credits however vere a stop-gap and not a solution. 3 this is why, starting with February 13, the isrgel government - rrime Minister David Ben-Gurion and his Finance Ministers ,Sliezir Kaplan and now Levi Eshkol - took a series of important measurese They started with a currency reform: devaiuation of the israeli pound and introduction of a triple exchange rates The immediate consegucnee was a steep rise in prices, especially of imported goods, anu a decreas in standards of living. in order to make full use of the encouragement this move was giving to export, the government launched a series of measures, aimed at encouraging efficiency and productivity: strict control on governmental services and dismissal of all useless personnel; introduction of norms ond other incentives to foster increased effort from capital and labor; favoring of competition through careful allocation of raw material and public work contracts etc. The next important step was taken in June: it was a 10% compulsory lonr on higher bank notes and bank accounts. i do. Py
