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Who says Israel is suffering? - The Afternoon

A M Rosenthal (in The New York Times) ()
27 November 1996

Title : Who says Israel is suffering?
Author : A M Rosenthal (in The New York Times)
Publication : The Afternoon
Date : November 27, 1996

New York : Long before Israel's election last spring,
Benjamin Netanyahu's enemies, homegrown and Western,
warned that if he won, the economy of Israel would swift-
ly be shot to bits.

Direct foreign investment would plunge downward. So
would foreign investment in Israeli stock markets.

Israel's foreign exchange holdings and credit rating
would dive. Trade with Arabs - - forget it.

Now predictions are stated as fact in newspaper columns
and opinion pieces. They announce that investment by
foreigners is falling steadily, Arab businessmen are
edging away, hope for huge regional projects is gone.
When predictions are stated as reality, they achieve
their objective of worrying more people, including poten-
tial investors.

Even if the predictions had become fact, Israelis were
right to select Mr. Netanyahu, not Shimon Peres, to
protect their security. But there is no evidence that
the predictions have become fact, and considerable evi-
dence indicating that they have not.

The latest statistics from the apolitical Bank of Israel
show that direct foreign investment increased by 29 per
cent, to a record $1.936 billion, in the first nine
months this year compared with the same period last year.

Foreign investments in Israeli financial markets in-
creased from $700 million to $1.1 billion. Foreign
exchange stands at a new high of $11 billion.

The bank says it does not keep monthly tabs. So it cannot
say how much of the increase happened during Labor's five
months in power this year, how much in Likud's four. But
top non-political Israeli economists say there is no.
sign of a turndown during Likud's months, particularly of
foreign investment in Israel's pivotal high-tech indus-

The recent economic conference in Cairo showed Arabs
eager to deal with Israel -obviously saying that peace
with the Palestinians would increase trade.

About those ideas of vast Arab-Israeli projects for air-
ports and power stations: No, none took place in Likud's
months. But none took place in all of Labor's years in
power. Maybe they never will. Trust between Arabs and
Israelis is too fragile.

Arab and Israeli economists understand that growth lies
in smaller enterprises.

Meanwhile, inflation goes down, from the 15 per cent
Labor bequethed to 11 percent. Israel's international
credit rating, reconfirmed recently, was never higher.

All this will come as disappointment to Israelis and
Westerners who yearn for the Netanyahu government to
become so destabilised that it would have to take Mr.
Peres and Labor into a coalition, giving him power that
the voters declined to renew.

Another piece of depressing news for destabilisation fans
is expected soon -agreement on Hebron. It would give
Israel the right not only to pursue terrorists into the
Arab sections after they kill Jews, but to go in if it
gets credible word that killings are being planned.

More critical issues remain between Israel and the Pales-
tinians, including Palestinian statehood, the size and
armor of the Palestinian army, and Jerusalem.

It has escaped Western interest, but the Israelis have to
protect themselves not only against terrorism but also
against countries that dearly want to destroy them --
including Syria, Iraq and Iran.

By voting for Mr. Netanyahu, most Israeli Jews knew they
might pay an economic price. Western opponents of Mr.
Netanyahu were taken aback by this decision -- so disre-
spectful to the supremacy of trade balance sheets.

The voters gave Mr. Netanyahu the right and duty to risk
paying an economic price for his country's security. It
has not come to that, according to the Bank of Israel.

But if ever it does, he win continue to have the same
right and duty, like every other elected leader.

This has reference to "Who says Israel is suffering?" in
your issue dated Nov 27.

Author : V Merchant
Date : November 27, 1992

It is the Editor's Choice and reproduced an articles by
Shri Abe Rosenthal that appeared in The New York Times.
Shri Rosenthal has mentioned how the dire prediction of
economic ruin of Israel should the right-wing Shri Benja-
min Netanyahu win the elections have turned out to be a
whole lot of hot air. It reminds me of the similar pre-
dictions that were used to scare away the voters in case
of the BJP. The sad part is that Shri Rosenthal himself
was a part of the coterie that indulged in the propagan-
da. A country's interests are best protected by a politi-
cal party which keeps the country at the top most in
determining what is right for the country.

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