Israel Capital Jerusalem Currency Israeli Shekel (ILS) Language Hebrew Population 6.35 million EU status Non-member GDP 2006 $121.6 billion Employment 91.5% Exports $42.86 billion f.o.b. (2006 est.) Imports $47.8 billion f.o.b. (2006 est.)

setting up business Number of days to start business 21 Cost (% of income per capita) 91.1% Nonwage labor cost (% of salary) 5.9% Total tax rate (% profits) 39.1%

Israel

New construction in Tel Aviv

At the crossroads of Europe and the Middle East, Israel’s modern, international outlook and export-oriented economy stand out amid the region. While the political center of the country is located in Jersusalem, the business and financial sector is in Tel Aviv. Israel has a young and welleducated population – the median age is 29.6 years, and some 24% of the population hold a university degree – and a dynamic, investor-friendly business culture. The economy has recovered well from a brief recession in the early 2000s, and growth currently stands at about 4%. S&P recently confirmed Israel’s long- term rating outlook as A+ or “positive”, indicating a strong economy that is well set to continue on its present track.

The role of FDI

Israel and the US have a close economic and political partnership, and this is reflected in the high levels of investment between the two countries. Over the last five years, 54% of FDI projects in Israel have been backed by US-based companies, with high levels of support from European countries such as the UK, France, Germany and Switzerland. Foreign-owned companies enjoy the same legal rights as Israeli companies. Generous tax exemptions are available for new immigrants and foreign investors, including tax holidays of up to 10 years.

Pro-business environment

Israel’s supportive business environment includes:

• A large volume of high-tech and science-based industry;
• Highly educated workforce and multilingual population;
• World-renowned research and educational institutions;
• Worldwide taxation and customs treaties;
• Protection of trademarks, patents and intellectual property of all kinds;
• Comprehensive legal protection of foreign companies;
• State-of-the-art telecommunications ;
• A highly advanced banking and financial sector.

Israel currently has free trade agreements with the European Union, EFTA, many Eastern European countries, Canada and Mexico.

investment prospects

All sectors in Israel are open to foreign investment. Israeli companies have particular expertise in:

• Biotechnology
• ICT
• Environmental projects
• Medical science
• Security and defense
• Chemicals
• Venture capital
• Agrotechnology

A high-tech economy

According to government figures, some 90 % of venture capital in Israel is directed to the high-tech sector. It is also a major point of interest for foreign investors – since 2002, 32% of FDI projects have been in the IT sector, 18% in electronics, and 7% in life sciences. The booming high-tech sector has attracted many of the world’s leading companies to invest in Israel – software producer Oracle, for example, has recently opened a new R&D center, and has plans for investment in up to 15 Israeli tech start-ups during 2007.

Israel has a well-deserved reputation for being at the cutting-edge of research – voice-mail, IP telephony and instant messaging were all invented in Israel. Overall, about 60 companies have R&D centers in Israel, including Intel, Microsoft and IBM.

The high-tech sector benefits from generous government support – in fact, Israel is ranked first in the world for the amount of GDP spent on R&D per capita, and the benefits of this program filter through to all other sectors of the economy. For example, take Israel’s strong agricultural sector, largely selfsufficient in citrus, vegetables, cotton; beef, poultry and dairy. Thanks to heavy investment in research into agriculture and agrotechnology, the sector boasts world-class standards of quality, productivity and efficiency.

AMCHAM ISRAEL

The Israel-America Chamber of Commerce and Industry (AmCham Israel) is a voluntary organization of companies and individuals dedicated to the promotion and enhancement of two-way trade and investment between Israel and the US. American corporations regard the AmCham as a vital and dynamic factor instrumental in the fostering and promotion of trade, and the logical point of contact for any initiative regarding business with Israel. Close government networking ensures ongoing contact with US and Israeli authorities on commercial, economic and legal issues to provide insight and react to upcoming legislation.

 

Contact Information

Israel-America Chamber of
Commerce and Industry
35 Shaul Hamelech Boulevard
Tel Aviv 61333
Israel
Tel: + 972 3695 2341
E-mail: amcham@amcham.co.il
Website: www.amcham.co.il

 

Useful websites

www.israelfm.org	Israeli Consulate in New York
www.investinisrael.gov.il	Financial and economic advice
www.moit.gov.il	Ministry of Industry, Trade and Labor
www.export.gov.il/eng	Export & International Co-operation Institute
www.goisrael.com	Tourist advice

 

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