Business in Brief

Oren Majar
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Oren Majar

El Al has made preparations to avoid Turkish airspace, if necessary. The airline created the plans at the start of the present crisis in relations between Israel and Turkey. Such a change would increase flying time to destinations such as China, Hong Kong, Thailand and some states of the former Soviet Union. This would increase costs and lead to higher ticket prices - and also hurt El Al's bottom line. Transportation Ministry officials said they hoped Turkey would not change its aviation agreements. One senior industry official said such a move by Turkey was unlikely as it would bring harsh criticism from international organizations and would violate international law. (Zohar Blumenkrantz )

The chemicals and refined petroleum products sectors are the sectors most exposed to Turkey and the fallout of the present crisis, reported the Israel Export & International Cooperation Institute yesterday. Sales of chemicals and petroleum products to Turkey accounted for 10% of all such sales, worth $780 million in 2010. Metal exports are another industry with large sales to Turkey, mostly of recycled and scrap metals. But the high tech industries have almost no exposure at all to Turkey, with only about 0.6% of such sales going to Turkey. Industry, Trade and Labor Minister Shalom Simhon said he hoped the trade between the two countries, which is to the benefit of both, will continue to be a bridgehead for relations in the future. (Ora Coren )

Increasing the number of free channels to 18 on the Idan Plus digital television service will cost cable company HOT and satellite broadcaster Yes about 150,000 subscribers, a government report estimates. These households will save over NIS 200 a month, or about NIS 2,500 a year. This is not expected to bring about the collapse of the companies, only lower profits. Most of those expected to leave have incomes in the lowest deciles. The Knesset Economic Affairs Committee debated expanding the Idan service last week and the full Knesset would have to approve the change. Currently there are only five free channels. (Amitai Ziv )

Israel has moved up two levels in the World Economic Forum's Global Competitiveness Report for 2011-2012 to 22nd place. The survey examines the business-operating environment and competitiveness of the economy on a global basis, but does not examine the level of centralization or competition between companies. Israel has slipped far from its highest ranking of 14 just four years ago. Switzerland, Singapore, and Sweden continue to lead the list and the United States slipped even further this year to fifth place. The annual report, to be released today, covers 142 countries. The Manufacturers Association of Israel conducts the Israeli part of the survey. (Ora Coren )

Just before tens of thousands of workers receive their holiday gift vouchers before Rosh Hashanah, the issuers of some of the vouchers are being sued for hundreds of millions of shekels. Super-Sol and Alon Holdings Blue Square Israel are being sued in a class action. The plaintiffs say the purchase of the vouchers is actually a loan to the company as it has use of the money until redeemed, yet the companies place unreasonable and excessive conditions on their use, such as expiry dates. Gift vouchers are a NIS 2.5 billion annual industry; it is estimated that 3% of this amount is never redeemed, mostly because time runs out before people get around to using the vouchers. Some 70% of the amount goes toward food purchases. (Hila Raz )