Business in Brief: November 19

Economy index shows slower growth; TV subscribers continue to leave HOT; Gov’t proposes China investment group.

By GLOBES
Economy index shows slower growth • By YAEL GRUNTMAN
The composite state of the economy index compiled by the Bank of Israel rose 0.1 percent in October, pointing to a slower rate of economic growth, the central bank reported Thursday. The moderate rise in the index is a reflection of higher imports of consumer goods and production, at the same time as a decrease in indices measuring exports of goods and services, trade and services revenue, and manufacturing production.
Among the indexes that the Bank of Israel takes into account, the trade and services revenue index fell 0.7% in September after rising 0.7% in August, and the consumer goods imports index jumped 15.7% in October after falling 1.7% in September. Imports of production inputs rose 1.8% in October after a rise of 2.5% in September.
The index for September was revised to a gain of 0.1%, from the previous no change, and the August index was revised downward to 0.1%, from the previous 0.2%.
TV subscribers continue to leave HOT • By YOSSI NISSAN HOT
Telecommunication Systems Ltd. continued to lose TV cable subscribers but gain telephony and Internet subscribers as the company turned to a profit in the third quarter of 2010. HOT posted a net profit of NIS 53 million for the third quarter, compared with a net loss of NIS 14m. for the corresponding quarter of 2009. Revenue rose to NIS 816m. for the third quarter, from NIS 789m. for the corresponding quarter.
During the third quarter, HOT lost an additional 3,000 cable TV subscribers, to 889,000 at the end of September from 892,000 at the end of June. The company had 911,000 cable TV subscribers at the end of September 2009. The company said most of the former subscribers were analog customers with low average revenue per user and low profitability for HOT.
In contrast, HOT added a net 12,000 Internet subscribers during the third quarter, to 741,000 at the end of September, and added a net 10,000 telephony subscribers, to 794,000. The company had 706,000 Internet subscribers and 536,000 telephony subscribers at the end of September 2009.
Gov’t proposes China investment group
An Israeli government committee is proposing the creation of a joint investment group with China as part of a program to boost exports, an Israeli official familiar with the discussions said. The group would consist of Israeli officials, together with Israeli and Chinese institutional investors according to the proposal, the official said. The group would help finance infrastructure projects in China that included Israeli technology and know-how.
The committee is led by Finance Ministry Director- General Haim Shani. Accountant-General Shouky Oren and State Budget Director Udi Nisan will travel to China next week, and the committee is expected to make recommendations to Prime Minister Binyamin Netanyahu after their return, the official said.
Israel is trying to expand exports to emerging markets as growth in Israel’s main export markets, the US and Europe, remains sluggish. Almost half of Israel’s gross domestic product comes from exports and about 60 percent of those goods are sold to the US and Europe. • Bloomberg