Israels New Government: Will Innovation, Science, And Technology Be Put On The Back Burner?

Nimrad Vromen, Arnon Partner, Tadmor-Levi, CEO of Consiglieri Ltd.

The new science and technology minister should remember that during COVID, Israeli high-tech made up 10% of the national workforce, generated 25% of Israel's tax revenue and 43% of its exports. Therefore, this industry cannot be taken for granted; Its mobility cannot be underestimated. The government should make sure that workers in this sector stay here in Israel and be happy. They must do so by whatever action or means they deem appropriate. For example, one of the new things the government needs to do is take positive steps to reduce the impact of taxes: many elements of the tax code can be interpreted in ways that are difficult for Israeli business owners, such as capital gains, employee election, severance pay. taxes and more, but the government needs to restore "old successes": whether it's increasing public investment in technology through incubators and other new programs, Israel's founders will find it hard to argue that they are "subsidizing other less productive sectors without coming back."

Dorell Yishai, CEO of StartPlan

“The growth of the Arab and ultra-Orthodox (Haredi) population in Israel is one of the most significant phenomena we have seen in the last two decades, and it is clear that this trend will not disappear anytime soon. According to a number of studies, by 2030 this population group will make up the majority of Israel's population. Our goal is to successfully integrate this population into the high-tech sector by preparing them. Because high technology will be the engine of Israel's economic growth. In the coming years, such integration is essential for our economy. The government should promote English-language education, the study of software engineering, mathematics, and other high-tech tools and skills in ultra-Orthodox and Arab communities by consent, not coercion. By simply making this change, we will continue to lead the tech industry as a start-up nation.”

Sarit Musayuf, Partner at M. Firon & Co., M&A, Head of China

“Now the ROC is starting to think about how to ease Covid-19 restrictions and is committed to developing advanced technologies that can help China and its people move forward in their daily lives (AI technology, G-5, life sciences, automation ). ). , robotics, etc.) it may be relevant that one of the issues being considered by the newly appointed government is the curtailment of Chinese investment in the Israeli tech industry. Of course, this should be limited to technologies intended for civil use only (i.e. no dual use). Such a move can have its benefits and be a win-win situation for both parties. First, it will help reshape the Israeli technology industry to export advanced technology to China and from there to the Far East; this will attract the capital the industry needs, especially in these turbulent market times. The company is having difficulty raising capital for current operations, so this should come in handy. Such investments in Israeli technology will allow the Chinese to rely on Israel's key technologies for the development of their people and their nation."

Joachim Seid-Ronen, CEO of Big-Tech 50

“The new government will face challenges in the short and long term. In the short term, there are many layoffs; in the long run, they should maintain sustainable growth.

Now there is no doubt that the problem of laying off thousands of employees must be solved. We are currently seeing companies lay off to become more efficient and use less cash, but over the course of the next year we are likely to see most young companies go out of business and lay off all remaining employees. Add to unemployment the rise in the cost of living and housing prices, and you get a lot of high society citizens trying to make ends meet.

In the long term, the growth of the high tech sector and its needs is a constant challenge for any government, but this is especially true for new governments because the new government does not know what the high tech sector is. That is, industrial growth requires skilled labor and ease of doing business. The increase in the number of qualified personnel required an increase in the level of education and the introduction of new classes of high technology, including Orthodox and Arab men. This inclusion seems to be the opposite of what the new government wants.”

Ida Eilan, CEO of 3DM Digital Manufacturing

“The new government will have to deal with the current geopolitical and macroeconomic forces and global shocks that affect the country's economy in a very wide sense, from unemployment and inflation to the cost of living and poverty.

Although the Israeli high-tech sector is considered one of the strongest sectors in Israel, it will be one of the challenges facing the government, and certainly one of the most important.

Contributing significantly to GDP and having a huge impact on the Israeli economy as a whole, Israel's high-tech ecosystem is very important for the country and, given the current situation, needs help.

Given the favorable investment climate in both the public and private sectors, the government would be wise to address immediate issues while maintaining a long-term perspective. Accordingly, I intend to selectively provide temporary liquidity support to companies that meet well-defined criteria that support long-term domestic strategic assets and capabilities.

This policy, implemented responsibly and in the right conditions, will benefit everyone, especially small and medium-sized enterprises with high potential. It will also stimulate productivity by investing in them instead of unemployment benefits.”

Keren Lesham, CEO of OCON Healthcare

“The Israel Innovation Authority and the Ministry of Technology play an important role in supporting the quality of life of Israeli women by funding projects related to women's health. It is important that resources be directed towards research aimed at women, anatomy, physiology and related diseases, and that this specific budget be allocated to half the population of Israel.”

Amir Zolti, Partner and Head of High Tech Practice at Lipa Meir & Co.

“What should the new government do to help the local tech industry? My short answer is: leave deep boundaries to industry and professionals and use the power of government to promote and maintain a safe and prosperous ecosystem that sustains and sustains the industry. In particular, the government should increase the budget of the Israel Innovation Authority (or at least not cut it) and leave the decision-making and initiative in this area to the IAA rather than politicians (but also pass the necessary laws if necessary).

Governments should focus on supporting, promoting and perhaps even expanding commercial and technological ties with some neighboring countries as a result of the Abraham Accords. We have seen some promising commercial developments in this area and the possibilities are endless.

The government should focus on technological education and education for the 21st century, with particular attention to peripheral geographic and socio-economic areas. The private sector is ready to help, but local and individual initiatives alone are not enough.

Governments should pay close attention to the potential impact of dramatic political (internal and external), economic and infrastructural changes on Israel's image as a safe and supportive technology hub, home to more than 100 research centers of multinational organizations and a focal point for the international community. community. technology and business community. .

Yael Shimon-Mani, Partners, Pearl Cohen Hi-Tech Group

“In recent years, we have seen a steady growth in the number of startups, as well as the participation of successful Israeli companies (“unicorns”) in the Nasdaq IPO race. The current slowdown in the market will open opportunities for Israel. keep only good medium companies. which are developed here in the local market. To do this, the state must create conditions that encourage Israeli technology companies to grow and settle in Israel, while maintaining their headquarters and most of their workforce here. This can be achieved through government assistance in technology infrastructure, easing regulations in related areas, and providing tax incentives for growing companies in Israel (while regulating the taxes of investors and funds that support high-tech companies). All of this should happen at the same time as the release of public funds intended to further support innovation, including through the creation of a hidden education (and future Israeli workforce).

The new government needs to allocate resources and streamline the bureaucracy as mentioned above, especially in the "traditional" sectors that are still lagging behind in terms of technology and innovation, such as proptech, insuretech and digital health, in order to maximize growth. technology industry, as well as the countries and citizens who use these services.”

Moshil Beaton, CEO and co-founder of Addionics

“The biggest challenge facing the Minister of Innovation is to continue to solidify Israel's status as a global technology leader in everything from transportation to energy to cybersecurity. Israel has shown in the past that it has great employers and a great environment. development of technologies that can transform into a giant multinational company, but both entrepreneurs and companies need an enabling environment and a government that can facilitate this activity, the activity that takes place in the field of transport and the EcoMotion community.

In my opinion, one of the most important areas that the Minister of Innovation should focus on is energy. It is the fastest growing sector in the world and is heavily invested by governments and private companies alike, all focused on promoting energy independence and accelerating the transition to renewable energy to reduce our carbon footprint and create a brighter future. us.

If the government is smart enough to support this activity by allowing it to become a technological powerhouse in this area, it can generate significant income for the country, invest funds from large corporations, create jobs and, perhaps most importantly, secure an energy future. security without having to depend on other countries, as is currently the case in many European Union countries.

Eyal Hoffman, Managing Partner, Highroad

“Everyone who enters the Ministry of Innovation, Science and Technology will face many problems, especially since in the current situation, the high-tech “engine” that drives the rest of the economy is constantly slowing down; l Ecosystems are undergoing major changes. This is not a change for better or worse, just a change in what we have become accustomed to in recent years. In this situation, the sooner policymakers can make appropriate decisions and provide support to the sector, the greater the chances for a quick and reliable recovery.

Precisely because Israel is a small country with a number of serious problems, especially those relating to various areas of infrastructure (transport, water and energy), one can expect it to be relatively easy to contribute to the development and implementation of solutions to problems and challenges. infrastructure. , what about us. In practice, it is a fact that many companies operating in this field experience great difficulties when operating in Israel: this is a very small market, which in most cases is not a benchmark. As a result, many investors refrain from investing in this area, unlike in the software world: development and growth are usually much slower, and the process is gradual.

If so, then in my humble opinion, one of the main tasks of the future Minister of Innovation, Science and Technology will also be to promote initiatives that can improve people's lives, give them the opportunity to act and gain experience at the local level. . market and increase the company's chances of success to facilitate investment and integration with a focus on infrastructure-related technologies as well as supporting regulations.

Technion Israel: Science and Coexistence Center