Trade Ministry aims to close social gaps
January 3, 2007. Jerusalem Post: Avi KrawitzSocioeconomic issues will top the agenda of the Ministry of Industry, Trade and Labor in 2007 as it seeks to boost investments in the periphery as a means to spur economic growth.
Speaking at a conference outlining the ministry's work plan for 2007 at its offices in Jerusalem Tuesday, Minister Eli Yishai also said the government would examine the possibility of increasing the budgets of the Investment Center and for research and development projects.
"The investment encouragement law is one of the central tools to strengthen and develop the periphery, to create a competitive advantage for traditional industry and to have a flow of local and foreign investments in the hi-tech sector," Yishai said.
The Investment Center at the ministry, which administers incentives given to companies making capital investments in Israel, currently operates with a budget of NIS 150m. and has expressed a need for another NIS 500m.
Similarly, the budget of the Chief Scientist's Office, which is responsible for overseeing subsidies granted to R&D projects, stands at NIS 1.1b. - well short of the NIS 2.5 billion required to meet the R&D requests from industry, according to Chief Scientist Eli Ofer
Last week, the Manufacturers Association of Israel appealed to Yishai, Prime Minister Ehud Olmert and Finance Minister Avraham Hirchson to increase Israel's investment promotion and R&D budgets when the three attended its year-end gathering.
Yishai again appealed to the Knesset's Finance Committee on Monday to increase the R&D budget saying the lack of consistency in the government's R&D budgetary policy transmits to a lack of investments.
Meanwhile, in outlining the central goals for the Trade Ministry on Tuesday, Yishai said it would work to increase participation in the work force, enforce fair trade, improve competition in the economy, increase exports and reduce social and economic gaps between the periphery and the rest of the country.
"The economy is failing geographically and in social issues," Yishai stressed.
As a result, he said key projects at the ministry would focus on strengthening the enforcement of labor laws; encouraging employment of minority groups such as the Druze and Circassian communities; providing professional training for the haredi community (see box); introducing special programs to build industry in the North and Gaza regions; accelerating exports of small businesses in development regions; developing the Negev; and advancing the water technology industry.
"The economic growth we have on the one hand and high levels of poverty on the other obligates us to adopt a balanced socioeconomic policy," Yishai said. "We are in the 21st Century and still poverty in Israel is growing. The gap between welfare recipients and the wealthy in Israel is among the largest in the world."
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