ry, and agricultural products (fruits and vegetables) are the
biggest export earners. The balance of payments has traditionally
been negative, but is offset by large transfer payments and foreign loans.
Nearly two-thirds of Israel's $16 billion external debt is owed to
the US, which is its major source for economic and military aid.
To earn needed foreign exchange, Israel must continue to exploit
high-technology niches in the international market, such as medical
scanning equipment. In 1987 the economy showed a 5.2% growth in real GNP, the
best gain in nearly a decade; in 1988-89 the gain was only 1% annually,
largely because of the economic impact of the Palestinian uprising
(intifadah). Inflation dropped from an annual rate of over 400%
in 1984 to about 16% in 1987-88 without any major increase in
unemployment.

GNP: $38 billion, per capita $8,700; real growth rate 1% (1989)

Inflation rate (consumer prices): 20% (1989)

Unemployment rate: 9% (December 1989)

Budget: revenues $24.2 billion; expenditures $26.3 billion, including
capital expenditures of $7 billion (FY89 est.)

Exports: $10.4 billion (f.o.b., 1989 est.); commodities--polished
diamonds, citrus and other fruits, textiles and clothing, processed foods,
fertilizer and chemical products, military hardware, electronics;
partners--US, UK, FRG, France, Belgium, Luxembourg, Italy

Imports: $12.4 billion (c.i.f., 1989 est.); commodities--military
equipment, rough diamonds, oil, chemicals, machinery, iron and steel, cereals,
textiles, vehicles, ships, aircraft; partners--US, FRG, UK, Switzerland,
Italy, Belgium, Luxembourg

External debt: $16.4 billion (March 1989)

Industrial production: growth rate - 1.5% (1989)

Electricity: 4,392,000 kW capacity; 17,500 million kWh produced,
4,000 kWh per capita (1989)

Industries: food processing, diamond cutting and polishing, textiles,
clothing, chemicals, metal products, military equipment, transport equipment,
electrical equipment, miscellaneous machinery, potash mining, high-technology
electronics, tourism

Agriculture: accounts for 5% of GNP; largely self-sufficient in food
production, except for bread grains; principal products--citrus and other
fruits, vegetables, cotton; livestock products--beef, dairy, and poultry

Aid: US commitments, including Ex-Im (FY70-88), $15.8 billion; Western
(non-US) countries, ODA and OOF bilateral commitments (1970-87), $2.2 billion

Currency: new Israeli shekel (plural--sh