Finance Minister Levi Eshkol presented his ordinary budget calling for an expenditure of 631,000,000 pounds and a development budget of 193,000,000 pounds for the fiscal year 1955 to a session of Parliament last night, At the same time, the Finance Minister presented one of the most optimistic analyses of the Israel economy yet placed before Parliament.
Mr. Eshkol reported that Israel’s adverse trade balance had been cut by 10 percent last year, that Israel’s currency had been stabilized to such an extent that her credit had jumped on the world markets, that national income rose to such a point that Israel became the 13th nation in order of per capital income, forging ahead of such industrial countries as Austria, Italy, Ireland, Greece, Turkey and Japan and that the cost of living had remained constant.
The basic reasons for the giant strides made by the Israel economy, Mr. Eshkol said, were the consolidation loan raised by American Jewish communities, bond sales in the United States, German reparations and a near-doubling in exports at the same time that imports were kept almost at the same level as 1953.
Speaking of the consolidation loan, bond sales and contributions throughout the United Jewish Appeal, he asserted that they bore witness to the devotion and concern of American Jews for the welfare of Israel, The consolidation loan, he said, had permitted Israel to cut its short-term indebtedness from $73,000,000 to $34,000,000. The bond drive had brought in $40,000,000 in 1954, bringing its full total in sales to $180,000,000. As of the end of December, 1954, Germany had made payments to Israel totalling the equivalent of $199,000,000, he said.
Last year Israel’s exports increased 47.6 percent over those of 1953 while imports only moved up by 2.6 percent, Mr. Eshkol reported. One-third of the currency in circulation was now backed by gold or foreign currencies and the per capita national income was 843 pounds as compared to 666 pounds in 1953. While the government’s fiscal policy had strengthened its banks and held prices, unemployment and taxes had dropped, he said.
More than one-third of the development budget, 67,000,000 pounds, has been allocated to agricultural improvements, the Finance Minister told Parliament, while 17,000,000 pounds has been earmarked for industry, 15,000,000 pounds for the development of electric power, 20,000,000 pounds for transportation expansion and 18,000,000 pounds for housing.
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