Lehman Brothers has disappeared. Halifax in the UK was sold overnight. And in Israel?

The shops are full, as people prepare for the Jewish New Year or the end of Ramadan. Banks are still rolling in the profits. Unemployment is at a record low.

And high tech? Well I can report form own perspective. I have one client, where contracts are being drawn up re a UK investor. Another has received 2 proposals from mainland Europe.

These are not freak incidences. A colleagues told me today that an investor, who last week informed him that a project looked interesting, is about to pop over to Israel to complete the deal. And so it goes on.

I find 2 lessons here:

a) The collapse on Wall Street and elsewhere was sparked by stupidities in the mortgage market in one country (and rising commodity prices). That does not mean all global economies are rotten.

b) The Israeli market has undergone some harsh restructuring since the previous high tech dive in  1999. It will not escape unscathed. However, it still has what to offer the outside world, especially in investment opportunities. Time for a visit.

I have just heard a fascinating approach to helping women enter the labour market in Israel.

What’s so special about that? Ultra-orthodox or Haredi women have often been held back from working. Their culture and society effectively “keep them in the kitchen and nurseries” even when they have solid qualifications. Other factors, such as not working directly with men or high maternity levels, have kept them unemployed.

Along comes Ms Libie Affen. A feminist? I am not so sure. Libie is a Haredi lady with a masters degree and the COO of Matrix, a leading Israeli high tech company. With a spin off from matrix, she has established a profitable company to employ Haredi es, to give them the conditions they require, and to produce quality output as demanded by Fortune 500 companies.

She currently employs 450 ladies, most of them software engineers or equivalent. One of the conditions is that they are provided rivate transport to and from the client. This allows them to deal with children int he evening and protect their modesty demands.

Now here’s the real “wow” factor. Libie has been asked to explain this model to a female cooperative in Detroit. And to take this one step further, the Palestinian Authority has also been in contact.

Why did I write this? Did you realise that Israel is about to swear in a female Prime Minister. She will sit along side the female head of the Supreme Court and Madam Speaker of the Kenesset.

A few weeks ago, I attended a panel discussion on the cleantech industry in Israel. Fascinating stuff. For example, it turns out that this tiny mass in the Middle East leads the world in solar tech. 

And that is not all. We grow algae in the dessert and send the production abroad. Shai Agassi’s non-fossel powered car is developed in Israel. Irrigaion techniques have moved far forward form computer linked sprinklers.

I was recently commissioned to investigate some greentech opportunities for a UK based investment group. I thought that I had seen eveything, but there was more to come.

I have met a company generating commercial power for communities out of manure and sewage. Another corporation is creating cooling systems out of crystals. And a third group has designed a housing complex where the power used is self-generated amongst the dwelling units.

These companies are earnestly seeking sales streams abroad, and they deserve all the success they can receive.

For the past year, I have been a member of the board the Israel-Britain Chamber of Commerce. The organisation was recently involved in coordinating the visit of the British Minister of Trade, Lord Digby Jones.

Now get hold of this:  “Over the past decade, bilateral trade has grown by 40 per cent and is now worth over £2.3 billion pounds. …..  more than 250 Israeli companies now located in the UK…. and 47 Israeli companies listed on London stock exchanges, with 41 having joined in the last three years.”
Lord Jones said his government organisation UK Trade & Investment, which is responsible for promoting the UK international business, is committed to securing another 25 more inward investment projects from Israel by 2010.

What an opportunity for Israeli companies. The Brits are actually giving a direct entry int the vast network of European trading relationships. Just hop on board.

Over the past decade Israel has received a lousy press abroad on the subject of human rights. Strange that for a country which has full freedom of worship, has non-Jews in its Parliament representating several political parties, and has a myriad of national papers.

By way of comparison, yesterday I received a report from the Ramallah-based Independent Commission for Human Rights. Every month they highlight abuses by Palestinian officials in Gaza and the West Bank. Using names, dates, places, in August 2008 alone, they refer to: –

    • 1 female citizen who died through so-called “honour crimes”
    • 8 citizens were reported to have been killed in family fights and acts of revenge
    • 15 complaints from citizens alleging that they were subjected to torture while they were being detained or interrogated. In the Gaza Strip, ICHR received 7 grievances from citizens, claiming that they were subjected to torture.
    • Attacks on charitable houses and orphanages
    • Interference with the legal system
    • Blocking distribution of daily newspapers

  • ~

It is said that the Israeli economy has grown by over 30% in 5 years, despite wars and the Intifada. The Palestinian economy is just the opposite.

The best proof for this came from Nigel Roberts, a senior offical at the World Bank. He has noted that Palestinians receive the highest level of aid per capita in the world, but implies that little seems to come of it.

And now along comes a report from Israel’s Civil Administration, responsible for the social and economic welfare of the West Bank. It starts by saying that as a result of less violence in the region, over 100 roadblocks have been removed. And thus?

Unemployment is dropping fast, although still too high at 19%. Tourism in places like Bethlehem has nearly doubled upto June 2008. Agricultural exports to Israel are up 25%, even after a disasterous weather spell. And so on.

This all generates real income, which assumedly must filter to the average man in the street. This will weaken the dependence on aid. And it was this aid, which seemed to feed only the violence and thus, ironically, into stabilising previous poverty levels.

The fallout of the mortgage crisis in America and the rise in commodity prices have begun to affect the Israeli economy, but to waht extent?

For the past 5 – 6 years, the stats show an economy that has grown by over 30%. No wonder the OECD wants Israel as a member. As for 2008, only last week, unemployment fell to another low of 5.9%. Time lag until it rises back up? Maybe, but all the predictions still say growth this year will round off at about 4%.

Now compare that to other countries.

Evidently, there are some underlying strengths within the Israeli financial scene that over weigh short term international economic changes. I was talking last week to a senior planner in the Ministry of Trade. Currently, the forecast for 2009 is growth around the 3.5% mark, well beyond almost all of Israel’s competitors.

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