CHAPTER XII TRANSPORT The output of the transport sector was 12 per cent higher in 1958 than in 1957, reaching approximately IL.400 million. The increase was relfected in all branches of the sector, with the exception of the railway services. In 1958 the shipping branch output rose by about 9 per cent, the correspond­ ing increase being 13 per cent in 1957 and 33 per cent in 1956. The declining rate of expansion was due to the slump which began to affect international shipping in the middle of 1957, and resulted in an average annual decrease of 11 per cent in the freight rates of ships plying regular lines. The output of the air transport branch increased considerably in 1958. "EL­ AL" Airlines expanded their operations by more than 68 per cent (as compared with 1957), after introducing their new "Britannia" aircraft into service. The increase occurred in both passenger and freight trafifc, which rose by 76 and 44 per cent respectively. The volume of inland passenger traiffc remained prac­ tically unchanged, as­ simultaneously with the opening of the new road to Eilat, which absorbed part of the air traiffc­ new air routes to the North of the country were established. The output of the railway sector was 6.5 per cent lower in 1958 than in 1957, despite a 5 per cent increase in passenger traiffc, since freights, which have a greater weight in the activity of this branch, decreased by 14 per cent. The year saw no changes in the output of the ports, which had increased by about 10 per cent in 1957. Indeed, during these two years Israel ports reached their optimum output potential. Since a considerable expansion of exports and imports is anticipated in the near future, the capacity of existing harbours will have to be expanded, and an additional deep­water harbour must be constructed in the South to meet the requirements of the central and southern areas of the country. In the motor transport branch, the process of replacing old equipment by new continued,­ as did the transition to heavy diesel­propelled vehicles, even­ tually intended to standardize the types of vehicles in the country. Output in this branch increased at a rate similar to that of the preceding year. No changes occurred in the index of transport prices, as harbour charges and the cost of road haulage and bus services were the same in 1958 as in 1957, while the slight rise in railway and air fares was offset by the decline in shipping tariffs. CHAPTER XH, TRANSPORT 157 Investment in the transport sector1 totalled IL.93 million in 1958, as against IL.120 million in1957, 2­a decrease of 23 per cent. The major contraction­ 44 per cent­ was in investment in aircraft. Investment in ships declined at the rate of 43 per cent, and in ports­ at the rate of 19 per cent. On the other hand, investment in aerodromes rose by 30 per cent, and in commercial motor vehicles­ by 22 per cent. Table XII­1 Indices of Real Output and of Prices in the Transport Sector, by Branches, 1958 (1957=100) Tndex Weight of branch D ■ Index of real , in total output Branch output . 0J of the transport pnces sector* Shipping 109.0 94.9 b 13.6 Aviation 168.1 104.2" 6.3 Railways 93.5 104.3 4.2 Buses 114.9 100.0 21.6 Other road vehicles^ mainly trucks 107.7 100.2 48.9 Harbours 100.7 100.0 5.4 All branches 112.3 99.8 100.0 * Weighted according to the estimate of added value in the subsidiary branches of the transport sector in 1957, as calculated by the Central Buerau of Statistics. b Including travel tax. 1 . Shipping The world­wide shipping slump of 1957 continued in 1958, causing a decline in shipping tariffs and the laying up of a number of ships. Neverthe­ less, the output of Israel's shipping rose by 9 per cent, as compared with 1957. At the end of 1958 Israel's merchant lfeet comprised 41 ships, with a total deadweight tonnage of 278,000 and a gross registered tonnage of 224,000 tons. Its passenger carrying capacity was 2,869. The average age of the Is­ rael lfeet was reduced from 11 years in 1957 to 10.7 years in 1958. This average is relatively low in comparison with the lfeets of other countries. It should be noted, however, that vessels aged 20 years and over still constitute 23 per cent of the Israel lfeet's total capacity. 2 Excluding investment in postal services and pipelines. 2 Revision of figure which appeared in the Bank of Israel Annual Report for 1957. 158 BANK OF ISRAEL, ANNUAL REPORT 1958 Table XII­2 The Israel Merchant Fleet, by Type of Ship, Gross Registered Tonnage, and Deadweight Tonnage, 1957­1958 (End of period( Number of ships Gross registered Deadweight Type of ship tonnage tonnage . 1957 1958 1957 7958 1957 1958 Passenger and mixed (cargo and passenger( 6 6 53,745 53,745 27,038 27,038 Cargo 24 31 104,341 135,914 154,641 197,720 Tankers 4 4 34,527 34,527 53,058 53,058 Total 34 41 192,613 224,186 234,737 277,816 Source : Ministry of Transport and Communications, Shipping and Ports Division. (a) Freight The carrying capacity of the dry lfeet rose by approximately 14 per cent during the year under review, increasing from 153,000 tons in 1957 to 206,000 tons in 1958. This increase, calculated by multiplying the increment of dead­ weight tonnage by the change in average speed, was due to the combined effect of two counteracting factors : The increase in total dead­weight ton­ nage, on the one hand, and a slight decrease in average speed, on the other. In 1958, $12.4 million were invested in the acquisition of 7 cargo ships with a total tonnage of 31,573 gross registered tons or 43,079 deadweight tons. These ships include three coastal trade vessels, two bulk carriers, one fruit carirer, and one refrigerator ship. Table XII­3 Cargo Carried by Israel Ships, 1956­1958 (thousands of metric t'ons) ­ . Cargo carried Cargo carried Total lype of cargo to and from between foreign cargo and ■y'ar Israel ports carried Dry cargo 1956 699 350 1,049 1957 732 528 1,260 1958 701 768 1,469 Oil in tankers 1956 341 21 362 1957 211 123 334 1958 10 351 361 * Excluding 465,000 tons of fuel carried from Sukreir to Haifa. Source : Ministry of Transport and Communications, Shipping and Ports Division. CHAPTER XII, TRANSPORT 159 The volume of cargoes carried during 1958 expanded to 1,469 thousand tons, as compared with 1,260 thousand tons in 1957­ i.e., an increase of 16.6 per cent. As in 1957, the amount of freight carried increased more than cargo carrying capacity, owing to the higher load factor in terms of metric tons. The volume of imports and exports carried by the Israel lfeet in 1958 fell by 4 per cent as compared with the previous year. The share of Israel ship­ ping in the carrying of cargoes to and from Israel has been gradually decitn­ ing since 1956, and this trend continued. Thus, imported fuel was carried to Israel almost exclusively by foreign vessels : Whereas in 1957 Israel tankers carried 12 per cent of the total amount of fuel imported into the country, in 1958 their share declined to 0.6 per cent only. The downward trend in the share of Israel tankers in the transporting of fuel to Israel, which likewise began in 1956, was due to a change in the sources of fuel supply and to the chartering of Israel tankers to foreign companies. During the last two years, the upward trend in the volume of cargoes car­ ried by Israel vessels between foreign ports continued, while the amount of cargo carried to and from Israel remained relatively stable. In 1958, cargoes carried by Israel ships between foreign ports for the first time exceeded the volume of cargo carried to and from Israel (see TableXII­3 ). This relfects a tendency to expand the operations of Israel ships to include new and distant markets. Liners as well as tramp ships were affected. The considerable increase Table XII­4 Sea­borne Freight Traiffc to and from Israel, by Flags, 1956­1958 (thousands of metric tons( Dry cargo Flag and year rvct imports exports total Israel lfag 1956 439 260 699 341 1957 516 216 732 211 1958 505 196 701 10 All lfags 1956 1,471 699 2,170 1,275 1957 ■ 1,540 862 2,402 1,727 1958 1,648 773 2,421 1,730 Percentage share of Israel lfag 1956 30 37 32 27 1957 34 25 30 12 1958 31 25 29 1 * Revised ifgures. Source : Ministry of Transport and Communications, Shipping and Ports Division 160 BANK OF ISRAEL, ANNUAL REPORT 1958 in the tonnage transported between forign ports, despite the world­wide ship­ ping slump, indicates that the expansion of Israel's tramp shipping was an effective move. This expansion was made possible by the newness of the Israel vessels engaged in trade between foreign ports, which enabled them to com­ pete successfully in this sphere, and by the fact that most of the expenditure involved is in foreign currency, no large amounts being required for the local purchase of equipment and supplies. (b) Passenger and immigrant traiffc The expansion programme of the Israel passenger lfeet was fully imple­ mented in 1957, no further acquisitions of passenger ships being made in 1958.