REOPENING OF STATE TRADE OFFICE IN ISRAEL PROPOSED.

Byline: Harrison Sheppard Sacramento Bureau

As Gov. Arnold Schwarzenegger visits Israel this weekend, back on the home front Assemblyman Keith Richman, R-Granada Hills, is pushing for California to reopen its trade office in that country.

The office was closed, along with 10 in other countries, during last year's budget crunch. Richman argued the Israel office cost very little compared with the trade it generated.

``The Israeli trade office has been in place for more than a decade now and in fact it has provided a large amount of trade opportunities for companies in the state of California and has generated a lot of jobs,'' said Richman.

Opened in 1993, the office cost about $64,000 a year to maintain on a contract basis with a private firm and also got involved with trade to other Middle Eastern countries. The state closed its foreign trade offices last fall in six Asian countries, Mexico, Europe and South Africa.

California imported more than $1.1 billion of goods from Israel last year and exported $320 million in goods, with the bulk of that trade coming through the Los Angeles area, according to the Los Angeles Economic Development Corp.

Still, that is a relatively small amount compared with the trade California did with the larger Asian nations, noted LAEDC economist Jack Kyser.

``It sounds good to open the office in Israel, but if you're going to start opening the offices, wouldn't you want to go to countries where we have bigger potential?'' Kyser asked. ``You'd have to say, OK, the largest source of exports out of the L.A. district is Japan. No. 2 is China. No. 3 is South Korea. (Israel) is quite a ways down.''

Schwarzenegger is visiting Israel this weekend to attend the groundbreaking for a new Simon Wiesenthal Center museum - a commitment he made long before he ran for governor - and to look for new business opportunities for California companies. He is expected to meet with leaders in the Israeli government, including Prime Minister Ariel Sharon.

On his way back, he will also stop at the Ramstein Air Base, a U.S. military facility in Germany, to visit California troops.

A Schwarzenegger spokesman said the governor has not taken a position on Richman's bill but will be looking to expand trade opportunities for California while he is in Israel.

The administration is also working on a separate bill, SB1665 by Sen. Dennis Hollingsworth, R-Temecula, that would encourage the establishment of trade and investment offices in other countries. The bill does not name the countries, other than Armenia.

A spokesman for the Israeli government welcomed the effort to bolster ties between Israel and California.

``If we put our two heads together, I think we can achieve great things, and this is a step in that direction,'' spokesman Daniel Seaman said, adding that it could ``benefit both the people of the state of California and the people of the state of Israel.''

Daily News correspondent Erik N. Nelson in Tel Aviv contributed to this report.

Harrison Sheppard, [phone]

harrison.sheppard(at)dailynews.com