Israel to Launch Private-Equity Fund to Develop Israeli Arab Sector
Media Line News Agency
July 06, 2009
Israel will establish a $40 million private equity fund aimed at maximizing the economic potential of the Israeli Arab sector.
Within the next two weeks the Israeli Prime Ministers will offer a tender worth 160 million shekels aimed at developing businesses within the Israeli-Arab sector, The Media Line has learned.
"We are establishing a private equity fund. We are going to put 80 million shekels [$20 million] into a tender that we are going to offer to the private sector and we expect that the private sector will put another 80 million shekels, so that we will have a fund for 160 million shekel [$40 million] to be invested in businesses in the Arab sector," Aiman Saif, General Director of the Authority of the Economic Development of the Arab Minorities in the Israeli Prime Minister´s Office, told The Media Line.
The initiative will be announced in English and Hebrew and will be distributed in newspapers, business newsletters and emails.
In order to be eligible for the fund, a business must be able to match the 80 million shekels spent by the government. Should an individual or group be willing to invest more, 100 million shekels, for example, then the fund will go to them. The money in the fund will then be managed by the winning group as they see fit.
Israeli Arabs constitute some 20 percent of Israel´s total population and according to statistics from the Center for Jewish-Arab Economic Development, over 45 percent of Arab families are poor, in contrast to 15 percent of Jewish families. The organization was started in 1988 by Jewish and Arab businessmen with the aim of economic cooperation between the two sectors.
In clear example of the low level of integration between businesses within the two sectors, Samer Nakleh, Import and Export Manager of Nakleh Coffee, told The Media Line, "We are the second largest coffee company in Israel but we are unknown to most Israelis."
"We are trying to help the Israeli Arab sector to be integrated in the Israeli economy because we think there is a great potential in the Israeli Arab sector that is not being used. We want to help the Arab sector exploit the potential within this sector and by doing so to help the Israeli economy achieve higher growth rates." Saif said.
One of the main problems facing Israeli-Arab businessmen is the lack of infrastructure making it hard for them to distribute their merchandise. Complicated local land laws mean complicated bureaucratic processes must take place before businesses can expand their facilities.
"We face a lot of problems. We face problems on the government level; we face problems with the private sector and of course we face problems in the field. Integration of the Arab sector in the Israeli economy is not easy – it´s very, very difficult," Saif said.
Israel is a modern economy and a member of the Organization for Economic Co-Operation and Development (OECD) with impressive statistics; as well as a 4.65 percent Gross Domestic Product, it boasts the world´s highest research and development intensity, over twice the OECD average of 2.26%. Many observers fear the continued under-development of the Arab sector will hold back further economic development.
Within the next two weeks the Israeli Prime Ministers will offer a tender worth 160 million shekels aimed at developing businesses within the Israeli-Arab sector, The Media Line has learned.
"We are establishing a private equity fund. We are going to put 80 million shekels [$20 million] into a tender that we are going to offer to the private sector and we expect that the private sector will put another 80 million shekels, so that we will have a fund for 160 million shekel [$40 million] to be invested in businesses in the Arab sector," Aiman Saif, General Director of the Authority of the Economic Development of the Arab Minorities in the Israeli Prime Minister´s Office, told The Media Line.
The initiative will be announced in English and Hebrew and will be distributed in newspapers, business newsletters and emails.
In order to be eligible for the fund, a business must be able to match the 80 million shekels spent by the government. Should an individual or group be willing to invest more, 100 million shekels, for example, then the fund will go to them. The money in the fund will then be managed by the winning group as they see fit.
Israeli Arabs constitute some 20 percent of Israel´s total population and according to statistics from the Center for Jewish-Arab Economic Development, over 45 percent of Arab families are poor, in contrast to 15 percent of Jewish families. The organization was started in 1988 by Jewish and Arab businessmen with the aim of economic cooperation between the two sectors.
In clear example of the low level of integration between businesses within the two sectors, Samer Nakleh, Import and Export Manager of Nakleh Coffee, told The Media Line, "We are the second largest coffee company in Israel but we are unknown to most Israelis."
"We are trying to help the Israeli Arab sector to be integrated in the Israeli economy because we think there is a great potential in the Israeli Arab sector that is not being used. We want to help the Arab sector exploit the potential within this sector and by doing so to help the Israeli economy achieve higher growth rates." Saif said.
One of the main problems facing Israeli-Arab businessmen is the lack of infrastructure making it hard for them to distribute their merchandise. Complicated local land laws mean complicated bureaucratic processes must take place before businesses can expand their facilities.
"We face a lot of problems. We face problems on the government level; we face problems with the private sector and of course we face problems in the field. Integration of the Arab sector in the Israeli economy is not easy – it´s very, very difficult," Saif said.
Israel is a modern economy and a member of the Organization for Economic Co-Operation and Development (OECD) with impressive statistics; as well as a 4.65 percent Gross Domestic Product, it boasts the world´s highest research and development intensity, over twice the OECD average of 2.26%. Many observers fear the continued under-development of the Arab sector will hold back further economic development.
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