Israel Exports Shift from West to East

August 5, 2010

Full diplomatic relations between Israel and these two countries were only established in 1992. The export to the United States in the first half of 2010 was valued at US $5.7 billion. “First, this could be part of the global economic crisis. This has been a bad year for Europe so they are importing less, and it’s been a good year for India and China with more stable consumers [markets],” Prof Joseph Zeira, from the Department of Economics at the Hebrew University, told The Media Line.

Dr. Yitzhak Lubelski, an expert on India at the Tel Aviv University, echoed Zeira’s analysis. “The Indian industry was not as badly hit by the (economic) crisis as the West and the growth rate of the Indian industry has been 10% annually,” Lubelski told The Media Line. “Also,” he added. “For the last 15-17 years there has been a steady increase in the amount of economic cooperation between India and Israel that is likely to keep growing.”

Lubelski said that Israel’s exports were mainly weapons, high-tech and agriculture products and this has not changed over the years. He speculated the recent crisis between Turkey and Israel helped Israeli businessmen seek alternative markets in India.

Prof. Michael Beenstock, a colleague of Zeira at the Department of Economics at the Hebrew University, warned that the number should not be taken as a sign that the Israeli economy was growing rapidly. “On one level its very important 40% of the Israel gross domestic production comes from international trade, but the Israeli economy is very versatile, as was shown that it did not suffer as other economies did in the sub-prime [housing economic] crisis,” Beenstock told The Media Line. “Europe and North America have suffered enormously while Israel has passed through it with ease, but this does not necessary mean that the Israeli economy as a whole is growing,” he added.  

Governor of the Bank of Israel Prof. Stanley Fischer said GDP [Gross Domestic Product] growth was slowing down from 4.4% in the last quarter of 2009 to 3.4% of the first quarter of this year. He warned that Israeli exporters needed to shift their exports to Asia to push growth. While India has become Israel’s largest arms buyer, the once lucrative weapons market in China has been severely curtailed due to US pressure.
 

Posted on August 5, 2010

Source: (By Adam Gonn, The Media Line, August 4, 2010)

Photo Credit: Photo by The Media Line