For a fourth consecutive year, Israel’s food industry has reported a decline in net profits, down 41% in 2000 compared with 1999, according to the Food Division at the Manufacturers Association of Israel

Gezy Kaplan, Food Division head and chairman of the Tivall Group, said that 2000 net profits amounted to NIS285m (US$68.6m), compared with sales of NIS488m in 1999. The figures pertain to the financial reports of the 29 top food and drinks processors, marketers and exporters in Israel.

Kaplan noted that 2001 food sales are expected to increase by just 3%, or NIS37.8bn, against NIS36.7bn in 1999. The Food Division also forecasts a 5% decline in food product exports, mainly due to the decline of the euro, and a loss of 500 jobs, “in view of the significant increase in the minimum wage scale.”

In a press tour yesterday marking Israel’s Food Day, Kaplan noted that the country’s food industry is handicapped by trade agreements with the EU, “which allows the import of cheaper products.” He called the government to challenge what he termed  “the absurd situation where cheap imports were allowed from countries that impose high tariffs and quotas on Israeli produce.”

He also called for a reorganisation of supervision in the domestic food industry: “There are 14 different and uncoordinated authorities supervising the production and marketing of Israeli food products. Not even one of these authorities assumes the responsibility when a problem arises. This resulted, inter alia, in the unwarranted price-hike of meat, which could have been prevented had there been just one independent supervisory authority.”

According to data released by the Food Division, sales of Israeli-made food products to the Palestinian Authority have fallen by 50% since the hostilities in the region started 8 months ago, incurring a US$50m loss to Israeli producers.

By Aaron Priel, correspondent