leading industrialists: the strength of the shekel - a disaster for export


by Ifi Reporter Category:Government Jan 21, 2018

More than 100 leading industrialists, hotel owners and managers gathered for a joint emergency conference of the Manufacturers' Association and the Israel Hotels Association on the subject of the dollar crisis, after the sharp drop in the dollar's exchange rate against the shekel. In the past year the strength of the Israeli Shekel severely damaged Israeli exports and the hotel industry in Israel.
During the course of 2017, the dollar exchange rate fell by 8.5% against the shekel (!), And since the beginning of 2018 its rate has fallen by another 1.8%
An international comparison shows that the Israeli shekel in 2017 became one of the strongest currencies in the world, while the shekel strengthened against the dollar by 8.5%, the British pound strengthened by 6.9%, the Canadian Dollar by 4.3%, the Swiss Frank (3.1%) , And the Japanese yen (-2.7%).
The conference was attended by Israel's leading industrialists and hoteliers. Shraga Brosh, President of the Israel Hotels Association, Amir Hayek, Chairman of the Israeli High-Tech Association, BATM Chairman Dr. Zvi Marom, Osem Chairman Dan Propper, Fattal Hotels - Avia Magen Mizrachi, Haim Mar, Chairman of the Communications Group. Mr. Roni Fortis, CEO of Prima Hotels, Avi Dor, Chairman of the Board of Directors, Beeper Communications, Elisha Yanai, Representative of the Growth Companies Forum, and similarWeb CEO, Jason Schwartz.
At the conference, hard data were presented showing that in 2017 a moderate real decline was recorded on the threshold of a 0.1% freeze in industrial exports, and a drop in the volume of Israeli exports as a result of currency changes, amounting to NIS 7.9 billion, with a two-year lag.
In addition, a survey conducted by the Economic Research Department of the Manufacturers Association, which examined the effect of the weakening of the dollar against the shekel, found that most of the companies were severely affected by the strengthening of the shekel and the decline in profitability. 53% of the industrial companies reported that in 2017, About 46% of the companies reported a quantitative decrease in export shipments due to the strengthening of the shekel, about 26% of the companies reported a decrease in domestic sales, and 28% of the companies reported a reduction in the number of employees.
Data from the Economic Department of the Israel Hotels Association show that due to the decline in the dollar exchange rate, the loss of revenues in 2017 was close to NIS 400 million. At the current level (NIS 3.4 per dollar), the annual damage will be even more severe, reaching NIS 600 million for the hotel industry. As mentioned above, any drop in the dollar exchange rate will mean an annual loss of NIS 13 million to hotel hotels. In 2017, tourist person-nights and revenue in dollars from incoming tourism constituted about 44% of all person-nights  revenue, as a result of the decline in the dollar exchange rate, profitability eroded by about 5%. In the areas of incoming tourism (such as Tel Aviv and Jerusalem), tourist person-nights constitute approximately 70% of total person-nights / revenue, so that the critical differences and the erosion in profitability even reach 8% -7%.
While the share of the hotel industry is about 44% of the revenue of the hotel industry, all inputs are shekel and rising: the minimum wage has increased by 23% over the last three years, and the wage agreement recently signed in the hotel industry has added 7.25% to 2017-2020. It should be noted that salary expenses in hotels constitute about 40% of turnover.
The open skies and the strengthening of the shekel against the dollar led to a 29% rise in the number of Israeli tourists traveling abroad in the last two years, with tourist stays in Israel stagnating.
Israeli investors' money abroad, the number of rooms owned / operated by Israelis is currently over 70,000 rooms abroad, compared to about 54 thousand hotel rooms in Israel.
Shraga Brosh, president of the Manufacturers Association of Israel, said: "Israeli industry is in real danger, and we can not continue to compete and carry out new transactions or continue existing transactions at existing gates. In Israel, the exchange rate is sane so that all export industries can continue to operate in Israel, which is not a problem for the advanced manufacturing industry or high-tech companies, but rather a threat to the entire economy. "



No comments have been left here yet. Be the first who will do it.

captchaPlease input letters you see on the image.
Click on image to redraw.


Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum


No testimonials. Click here to add your testimonials.