Raanan Dinor, CEO of the TMT: "The ministry's goal in the area of investments in R&D in industry for the next decade - to increase the volume by 15% per year." Dr. Eli Ofer, Chief Scientist at TMT: "We must increase the state's investment in R&D, which is only 1% of GNP"
"In the coming years we will have to change the national allocations, so that the security component will receive the proper weight to deal with the problems, we must make difficult decisions that will change the order of life, so that the civilian components will receive a budget that will create the infrastructure for maximizing the potential in the fields of education and R&D" - said today From the Prime Minister and Minister of Finance and Technology, Ehud Olmert, at the 2006 R&D conference of the Chief Scientist at Technology which took place today in Tel Aviv.
Minister Olmert also said that "we must think about a change in priorities that will affect the strength of the country". "My dream," said Minister Olmert, "is that within 5 years the investment in R&D will reach 10% of the national product. We are committed to setting ambitious goals and fighting for them in order to create the change."
Minister Olmert said that the State of Israel needs to understand that global competitiveness is increasing and in order to attract investors in multinational companies to invest, establish and maintain an advanced industry in Israel, investors must be given attractive conditions in all areas related to R&D grants, tax benefits and legal grants to encourage capital investments, if not We will miss the chance of the State of Israel's advantage over other countries. Minister Olmert also said that the priorities must be changed in order to give weight More to address the social problems.
The Director General of the Ministry of Foreign Affairs, Ra'anan Dinor, said at the conference that the main goal to be achieved by the Ministry of Foreign Affairs is the acceleration of growth. Dinor spoke about goals in the areas of investments and exports for the next decade:
* Increasing the scope of investments in the industry by 15% per year (an increase of NIS 2.5 billion per year).
* Increasing the scope of investments in R&D in the industry at a rate of 15% per year (about NIS 2 billion per year).
* Removal of export barriers - together with the increase in investments will lead to an increase in exports at a rate of 15% per year (the rate of contribution to GDP growth is 3%, approximately 40% of total growth).
Dinor spoke about the goals of the Ministry of Education and Culture to reduce social disparities by 2010:
* Increasing the participation rate to more than 60% (net addition of 25,000 jobs per year).
* Reduction of unemployment to the level of 7-6% (net addition of 10,000 jobs per year).
Dinor also said that the TMT Ministry has goals for strengthening the periphery (Negev, Galilee, Jerusalem):
* Increasing the participation rate in the periphery from 52% to 58% compared to the increase in participation in the center of the country from 61% to 64%.
* Reducing the unemployment rate in the periphery from 12% to 7.5% compared to its decrease from 8% to 6% in the center.
* Increasing wages (employees) in the periphery while reducing the gap between the periphery and the center of the country from a gap of 30% to a gap of 15%.
Dr. Eli Ofer, the chief scientist at the Ministry of Science and Technology, said today at the 2006 R&D conference that the Israeli government must increase the state's investment in industrial R&D, which is 1% of GNP. Dr. Ofer explains that although the investment in R&D in the state Israel is considered one of the highest in the world in terms of ratio of GDP (according to the CBS data, the investment in R&D in 2004 is 4.6% of GDP) but government funding is only XNUMX percent of GDP. Despite our achievements, we must not be overly complacent. The number of competitors and the amount of resources available to them are increasing, and the challenge of dealing with them is an ongoing process" - warns the chief scientist.
Yoram Oron, Chairman of the Association of Venture Capital Funds and founding partner of Vertex Venture Capital, moderated the panel on "The technology industry - a condition for growth and strengthening the economy" at the R&D conference today.
In response to Ra'anan Dinor's announcement about the allocation of one billion shekels to private funds and regulatory changes that will make it easier for institutional investors to participate in R&D funding, Yoram Oron says: "We see this as additional steps to bring institutional entities with government money into the venture capital circle in Israel. This means strengthening the two weak links in the financing chain of the high-tech industry - the seed stage and the light stage. These steps will allow the hi-tech industry to maintain a growth rate of 10% per year and realize the potential inherent in it.
Oron also said that "high-tech exports make up half of industrial exports. The growth rate of the industry is unprecedented, over 15% per year, which is a significant contribution to the growth of Israel's economy. Since the Israeli venture capital industry was established, just over a decade ago , venture capital funds raised 10 billion dollars for investments in Israel. In addition, the proceeds from the sale of Israeli companies reached 20 billion dollars. The total volume of IPOs by Israeli companies during this period reached $8 billion. The high-tech industry employs over 200,000 people directly in firms and indirectly in companies that provide it with services.
"In order to maintain the contribution of this industry to the economy and even increase it, it is necessary to deal with and prevent market failures, which may develop due to an inappropriate government policy on R&D. The venture capital industry in Israel is completely dependent on the investments of foreign investment bodies. There is no incentive mechanism for Israeli institutional investors to invest in the high-tech industry. Such a mechanism should be formulated. There is a fear that the universities will not develop the R&D capabilities needed in the future for a competitive and global industry. Government support has decreased drastically in recent years compared to investments by venture capital funds. In the food chain of the venture capital and high-tech industry, there is a weakness in the seed and light stage stages. The weakness can be overcome Through larger scientist budgets and encouraging Israeli institutional bodies to invest without addressing these failures will be harmed Growth in Israel, both on the external level - exports, and on the internal level - employment and productivity - something that will cause damage to the entire Israeli economy."
