by Nick Kolyohin
JERUSALEM, June 29 (Xinhua) -- The Israeli government has recently increased its efforts to attract multinational corporations to invest in Israel and relocate their research and development centers here.
The country has adopted a policy over the past two years to minimize the amount of red tape that corporations needed to contend with.
The Ministry of Economy and Industry established a center called "Invest in Israel," a one-stop shop to cut bureaucracy for potential investors, as part of the government's efforts to remove regulatory barriers for foreign investors.
One third of the multinationals have already used this unique government service. Israel's government believes that the more active multinational corporations are in Israel, the more the local economy and society will gain.
Eyal Eliezer, head of investment at the Ministry of Economy and Industry, told Xinhua that the new investment-friendly service has contributed to creating more jobs for local people.
"The big foreign companies open new attractive jobs for the locals and brings new opportunity to Israeli small companies to work on a world stage as subcontractors of leading corporations," he said.
Eliezer stressed that the new governmental strategy is to not just depend on the high-tech companies, but attract more industrial companies.
There are currently over 320 active multinationals in Israel, which, according to the Israeli Ministry of Economy, has tripled over the last decade.
In 2017 alone, the multinationals invested about 19 billion new shekels (5.2 billion U.S. dollars) in the Israeli economy. Although 70 percent of these companies are from the United States since 2005, there has been a massive increase of Chinese companies that entered Israel.
Some 250,000 Israelis, about 10 percent of the Israeli workforce, are currently employed by international companies. Considering the country's exports, the influence of the multinationals is even more significant, with one quarter of all Israel's exports coming from them.
Niron Hashai, an expert on Foreign Direct Investments with the Interdisciplinary Center and a professor of Hebrew University, told Xinhua that Israel is very aggressive in competition with other countries on the multinationals.
"Usually, the multinationals come to countries with low wages or low taxes, but here they are coming just for the best minds, and that's why they develop their R&D (Research and Development) here with the next cutting-edge technology," Hashai said.
According to the Israeli Ministry of Finance, the salary of Israeli workers in international companies almost double that of the workers with the same positions in local companies.
Half of Israel's budget for researching and developing new technologies is coming from multinationals, which employ 50,000 workers for that purpose. The annual investment of the companies just for R&D is 20 billion new shekels.
Yifat Turbiner, an economy expert at Ben Gurion University, thinks that not all is bright with Israel's collaboration with international companies.
"The patents developed by the Israeli minds are going to these foreign companies and it is a dangerous situation, because once something goes wrong the companies can just turn around, and go to another country with all the Israeli knowledge," he explained.
Andy David, director in the Israeli Ministry of Foreign Affairs, said the ministry is continuously thinking about how to reach new international companies and to be more appealing for them to come to Israel.
Altogether 103 Israeli ambassadors around the world have been recruited in the national effort to bring more foreign companies to Israel.
It is viewed that Israel's society and government are usually considering the investment by multinational companies in Israel as an approval and acceptance of Israel as a Western prestigious country, rather than as a country with unrelenting wars often depicted in the news.
