Business information company Dun & Bradstreet (Israel) Ltd. sees a worrying rise in the level of risk in the Israeli economy in its September 2010 index. The level of businesses in danger of shutting down rose to 13.4% in September compared with 13.26% the preceding month - a rise of 0.31% since the start of 2010.
As of today, 16,642 Israel businesses are at high risk. D&B said, "The continuation of a similar business environment will lead to a situation within six months time whereby these companies will have cash flow problems that will make it difficult for them to carry on operations, or will lead to their collapse."
D&B's economists believe that the rise in the interest rate by the Bank of Israel due to fear of inflation, and the strengthening of the shekel are negatively influencing export oriented branches, and this is reflected in the risk index.
An example of the effect of strengthening of the shekel can be seen in agriculture where over the past 18 months there has been a worrying rise of 0.65% in the risk index from 9.91% in March 2009 to 10.56% in September 2010. The shekel has reached its strongest level in several years and this has hit income of agricultural exporters of flowers and fruit to Europe. The heat wave in July and August also significantly hurt crops and yields.
Published by Globes, Israel business news - www.globes-online.com - on October 11, 2010
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