Intifada slows foreign investment in Israeli stocks
Foreign investment on the Tel Aviv Stock Exchange dipped strongly during October-November, coinciding with the first two months of Intifadat Al-Aqsa. According to Globes, the Israeli business daily, foreign investment declined by $252 million providing a cumulative decline of $542 million in April-November and more than $1 billion since the beginning of 1999.
The newspaper reported that direct and financial foreign investment equaled $378 million in October-November, 85 percent below the $2.46 billion invested in the third quarter of the year.
Furthermore, in October-November, foreign investors bought only $319 million of Israeli bond issues in primary markets abroad, 70 percent down on the $992 million raised on overseas stock exchanges in the third quarter.
Still, despite the slowdown in investment during the period coinciding with the clashes in the Palestinian areas, the Bank of Israel forecasts that 2000 will be a record year for foreign investment, with total direct and financial foreign investment standing at $8.6 billion since the beginning of the year, 1.5 times than the amount raised during all of 1999. Direct foreign investment totaled $4.4 billion, compared to $2.9 billion last year, and investment in negotiable securities portfolios also grew 1.5 times $4.15 billion, from $2.7 billion last year.
Financing rounds by Israeli companies on overseas stock exchanges rose by 27 percent this year to $4.1 billion, compared to $3.2 billion in 1999. – (Albawaba-MEBG)