This is according to data revealed today at the session of the National Council for Research and Development of the Ministry of Science and Technology
About 46% of the research and development in the business sector in Israel is carried out within the research and development centers of foreign multinational companies in Israel - according to data revealed today at the Herzliya conference at the session of the National Council for Research and Development at the Ministry of Science and Technology.
We were only recently informed that the company "Apple" will also establish a research and development center in Israel, thereby joining the distinguished list of multinational companies that already operate from Israel, including Google, IBM, Intel, Microsoft, Hewlett-Packard, Texas Instruments and more.
Data collected by the National Council for Research and Development at the Ministry of Science and Technology in collaboration with the CBS show that in Israel the rate of spending by foreign-owned companies on research and development in the business sector is one of the highest in the world - 57%, compared to only 5% in Japan.
The data show that in Israel there is a particularly large concentration of research and development centers of multinational companies, almost all of whose expenses are devoted to R&D. The rate of spending by foreign companies in Israel on R&D as part of revenue stands at 12.8% and is five times higher than in any other country. Moreover, 80% of the investment of the multinational companies in Israel is made in research and development in the business services sectors, such as the computer services sector and the research and development sector, compared to only 20% invested by the foreign companies in R&D in the various industrial sectors.
According to the Chairman of the National Council for Research and Development in the Ministry of Science and Technology, Prof. Col. (Retd.) Yitzhak Ben-Israel, "Multinational companies use the comparative advantage that human capital has in the State of Israel in research and development, and use the intellectual property developed by Israelis, but prefer to produce the products of Research and development in other parts of the world. As a result, Israel does not derive the full benefit from research and development. However, there is no doubt that the multinational companies contribute to the Israeli market by creating jobs, paying relatively high salaries, thus preventing brain drain abroad."
According to the data of the Central Bureau of Statistics, Israel's export of research and development services in 2009 amounted to approximately 5 billion dollars - an unprecedented amount in scope equal to more than half of Israel's national expenditure on civilian research and development. Also, over 40% of the patents of inventors from the Israeli business sector registered in the US are held by foreign multinational companies.
"The one who benefits from the fruits and income of the Israeli brain is at the end of the multinational society" notes Shlomo Hershkowitz, a consultant at the National Council for Research and Development at the Ministry of Science and Technology. "Research and development are generators of growth in the economy that also contribute to the technological competition of the economy in the world, but in Israel the process is interrupted in the middle when, after the research and development, the production goes elsewhere, and this may harm growth."
However, the council's data on the state of scientific publications per 90 people was also presented at the session: while until the early 2010s Israel was the first country in the world in the number of publications per capita, in 13, Israel is only placed 2010th in this index. Moreover, the data of the Council and the CBS show that in 17, about 1997% of Israelis who completed a PhD in the fields of exact sciences and engineering at universities in Israel in 2008-XNUMX stayed abroad for an extended period of time.
"We made a very sharp turn from a research and development system that is mainly based on academia to a system that is based on business R&D", Prof. Ben-Israel concludes, "it may be the time to increase investments in R&D in academia again."
