Israel’s troubled economy has taken a serious turn for the worse because of Finance Minister Yoram Aridor’s policy of sustaining the Shekel at an unwarranted high rate and the public’s rush to consume rather than save, according to “senior economists ” quoted in Haaretz today.
The paper disclosed hitherto unpublished reports by the Central Bureau of Statistics showing that Israel’s foreign trade deficit rose by 40 percent during the first half of this year and now stands at $1.7 billion, an all time high.
The economists blame Aridor for slowing down the devaluation of the Shekel which enouraged imports at the expense of the export industries. The Treasury, belatedly acknowledging this by speeding up devaluation. The U.S. dollar sold yesterday at 49.78 Shekels, an 0.8 percent devaluation in one day, and was expected to sell for 50 Shekels today.
The economic situation has motivated the public to spend more and save less, Haaretz said. According to “reliable sources,” this trend began to be felt last February. The public no longer renews government sponsored savings programs and has reduced its purchase of government bonds.
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