JERUSALEM (Sep. 22)
Israel’s economy as a whole has been able to overcome the disruptions caused by the Palestinian uprising in the West Bank and Gaza Strip.
But some sectors, heavily dependent on the large Arab market, have suffered severe losses according to the semi-annual report of the Bank of Israel, released Thursday.
The central bank reported that the economic slowdown of the early months of this year has been reversed.
The economy has adjusted to the situation in which Palestinian day laborers from the territories frequently fail to show up for their jobs, the report said.
The main reasons for the slowdown were shrinking demand and a 40 percent drop in the number hours worked by Arab laborers.
But the economy is now stabilizing and some sectors are expanding.
Nevertheless, because residents of the territories have cut back on their purchases from Israel, consumer industries have reported a 40 percent drop in sales.
Especially hard hit are the medical drug industry which reported a 25 percent decline, and the sale of cigarettes, down an overall 15 percent.
One brand popular with Arabs, called “Time,” suffered a 35 percent loss of sales.
The manufacturer of a product called “Cheap-Choc” has called for a counter-boycott of goods manufactured in the territories, Yediot Achronot reported this week.
Israeli Arabs are benefiting from the unrest in the territories. Before the uprising, Israelis drove regularly to the West Bank and Gaza Strip to shop for bargains.
Now they are going instead to the Arab villages in Israel, which are considered safe and undersell Jewish vendors.