Leader of Israel’s Manufacturers Association Warns on Inflation

“Intense inflation” faces Israel and “there seems to be no way to avoid it,” Zalman Suzayeff, chairman of the presidium of the Israeli Manufacturers Association, warned here today.”Under these circumstances,” he declared,”the Governments principle should be to channel the inflation into some kind of framework, so that we will be able to see the end of the inflation.” He stressed that “Israel cannot absorb any further increases in production costs. Every increase in wages will be reflected immediately in the price of manufactured goods, he said.

Meanwhile, the Central Bureau of Statistics announced in Jerusalem that Israel’s trade balance has improved this year. The figures showed that the trade gap — the difference between the value of exports and the value of imports — totaled $406, 000, 000 in 1965, as compared to $466, 000, 000 in 1964. Imports during both years were at almost the same level, amounting to $835, 000, 000 in 1965 as against $838, 000, 000 the preceding year. But 1965 exports rose by almost 15 percent in 1965, totaling a value of $403, 000, 000 as against $372, 000, 000 in 1964. The statistics also showed that, of the total 1965 imports, 22 percent were in investment goods.

Finance Minister Pinhas Sapir is expected to declare officially in the next few days that Israel is now in the throes of a “drought year.” A request that he issue such a statement has been made by Chaim Givati, Minister of Agriculture, in view of the paucity of rain this year.

The Agriculture Ministry has sent experts to tour stricken areas in the Negev and in the lower sections of Galilee, to evaluate the situation caused by lack of rain. All requests for increased water allocations for the irrigation of crops have been granted by the Ministry of Agriculture. Due to insufficient rains, the loss of water has been estimated at several hundred million cubic meters.