First-quarter hi-tech exports climbed 10% to $2.7 billion

First-quarter hi-tech exports climbed 10% from the same quarter of last year to $2.7 billion, says the Association of Electronics & Information Industries.

Elisha Yanay, head of Motorola Israel and chairman of the association, said the figures are indicative of the rally by hi-tech in general, and the Israeli sector in particular.

"After three years of declining or stagnating exports, we anticipate a significant increase," Yanay said. "We estimate that hi-tech exports will continue to grow, and that exports of electronics, IT and software will exceed $11 billion in 2004."

The steepest first-quarter increase, 31%, was posted by industrial equipment, mainly for the semiconductors industry, which feeds the rest of the hi-tech sector. Electronic components also shot up, by 15%, while export of software increased 10% in the first quarter.

Exports of security and communications equipment grew by a lesser 4% in the first quarter compared with the same period of 2003, the association's figures show.

Hi-tech companies are starting to recruit again, Yanay said, but the state must do everything in its power to prevent a brain drain from Israel, and transfer of development to labs in India and China.

"There is a dialog between the industry and the Finance, Industry and Trade Ministries about increasing budgets for supporting R&D," Yanay said. And the time has come to implement the plans.

Amir Teig adds:

Europe is still Israel's biggest trading partner, according to the Central Bureau of Statistics. Import of goods excluding diamonds totaled $7.6 billion in January in the first quarter of 2004. Of that, 39% originated from European Union countries, 18% from the United States, and 16% from Asia.

Israeli exports excluding diamonds reached $5.8 billion in the first quarter, with EU nations buying 33% of the goods, the U.S. 28% and Asia taking up 14%.

Trend figures, minus seasonal influences, show steep imports growth from the EU, a 20/5% increase in the first quarter, in annualized terms. From October to December 2003, Israeli import from the EU increased 24.4%.

Imports from the U.S. shot up 41.5% from January to March, according to trend data, following a 25.3% increase in the preceding quarter.

Imports from Asia rocketed 41.5% in the first quarter of 2004, after rising 25.3% in the last three months of 2003.

Imports from the rest of the world climbed 33% I the first quarter, after rising 48.2% in the months of October to December 2003.

Exports from Israel also increased all over the world. Trend figures show a 18.6% increase to the EU in the first quarter, after rising 25.8% in the previous quarter. To the U.S., growth slowed to 8.3% in annualized terms in the first quarter, after a 28.3% increase in the last quarter of 2003.

Exports to Asia rose 38.2% in the first quarter, and exports to the rest of the world rose by 26.8% frtom Janary to March 2004, in annualized terms.

Israel's first-quarter trade balance with the U.S. was $247 million in Israel's benefit, but with the EU Israel ran a deficit of $1.1 billion. With Asia, Israel's deficit was $421 million and with the rest of the world, $596 million.