The rise of Jerusalem’s new economy
Jerusalem’s economy is changing, and quickly. It is no longer centred around government offices or even tourism. The Our Crowd Summit earlier this month – featuring thousands and with attendees from over 180 countries – is just the tip of a growing iceberg.
Only last week, I was invited to a new Fintech forum. This was on the back of one of my clients in the field receiving a massive overseas investment. At the same time, Crossriver, which only opened its R&D facility in Jerusalem a year ago and already employs about 60 people, has announced that it will build a brand new complex in the city. This will allow it to expand its activities far more quickly.
At the Our Crowd Summit, I was able to have a look at the wonders of Labs02. This is a hub of about a dozen companies. It is located in a revamped building near the former Jerusaelm railway station and which used to house the country’s money printing press.
These firms are handpicked. They are given an 18 month grace period and wrapped in the arms of brilliant tech mentors like Menachem Sheffer.
One that caught my eye is IntellAct. The concept is brilliant. We all know about the need to change a tyre in Formula 1 races within micro-seconds. This company applies the same principle to the ground services at airports. By smart-mapping the various suppliers – food, cleaning, refueling, onboarding, etc – the company saves the airline critical time, which adds up to a lot of big bucks.
Moving away from high-tech for a moment, I was struck by a joint effort of the Ministries of Foreign Affairs and Agriculture, located in the Holy City. For decades, Israel has been sharing its agritech with countries in Africa and elsewhere.
In Ethiopia, about 85% of its 110 million people live in small farming communities, and usually poor ones at that. Over the past three years, an Israel sponsored scheme called TOV – Good in English – has trained thousands to grow strawberries, tomatoes, avocados and cabbage. These are considered local staples and relatively profitable. In addition, there are many instances of new cooperatives, allowing for greater economies of scale.
If there is a sting in the tail of these success stories, it is the rest of government officialdom. Benjamin Netanyahu has been Prime Minister for 11 years consecutively. Despite his promises to counter the problem, Israel has consistently fallen down the international ratings when it comes to regulation and bureaucracy. For example, when it comes to flexibility and efficiency, the country has dropped twenty places to 69th.
Imagine what could really happen in Jerusalem if there was a Prime Minister who would let government free?