Figures published today by the foreign currency division of the Bank of Israel, regarding the rate of multi-national funds investment in Israel, reveal that since September 2000 Israel's ranking in the standard index of emerging markets, the MSCI (Morgan Stanley Capital International), has dropped to an average 4.5% from the previous high 6%.

The Bank of Israel is stressing the fact some of the investments of foreign residents in Israel are made as part of the activity of international institutional investors in emerging markets, and not just in Israeli hi-tech. Foreign investors establish the size of their investments in certain markets based on the relative size of these markets.

The MSCI index, comprised of 27 indices of national stock markets, is the guideline of portfolio managers specializing in emerging markets. The index is continuously updated by Morgan Stanley Dean Witter, and is one of a system of indexes used in most stock markets around the world. Each one of the MSCI indices is based on the most highly traded shares in a certain emerging market, shares which constitute 60% of the total market value of listed shares in the particular market.