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JERUSALEM – On June 18, U.S. Secretary of the Treasury Jacob J. Lew and Israeli Finance Minister Yair Lapid attended the closing session of the U.S. - Israel Joint Economic Development Group - the annual senior-level economic policy dialogue between the two countries. In his remarks, Secretary Lew acknowledged the importance of the meeting to strengthening bilateral economic policy coordination and deepening our cooperation across a broad range of sectors. In his remarks, Secretary Lew said, "Often lost in the headlines of our important security cooperation and close political ties are other aspects of our relations with Israel that are equally important, including the extraordinary economic and commercial ties that create jobs and contribute to prosperity in both Israel and the United States." Minister Lapid said, "One of Israel's greatest assets is America's friendship. It is one of the main keys to our success, one of the main keys to our security."


This year's economic policy dialogue, which took place June 17 - 18 in Jerusalem, included the participation of 80 senior U.S. and Israeli economic policy officials who exchanged views on a wide range of topics including fiscal and monetary policy and macroeconomic outlooks, as well as innovation, research and development, trade and regional energy issues. U.S. and Israeli officials agreed to accelerate negotiation of a new agreement on trade in agricultural products, expand exchanges to build Israeli regulatory capacity in the natural gas sector, and increase coordination on regulatory standards to ensure that the highest quality products from each side have fair access to the other's market.


The two sides also agreed to begin discussions on an umbrella Science and Technology Agreement that will create new opportunities aimed at strengthening research and development collaboration. Discussions between the U.S. and Israeli officials also included ways to reduce the cost of living by making markets in both countries more open.


As a continuation of our ongoing coordination on cybersecurity issues, the U.S. National Institute of Standards and Technology will participate in a workshop on June 19 with the Israel National Cyber Bureau on development of standards to reduce cybersecurity risks to critical infrastructure.


In addition to Secretary Lew and Minister Lapid, participation in this year's economic policy summit included Finance Ministry Director General Yael Andorn (Israel Chair), Dr. Karnit Flug, Governor of the Bank of Israel, Professor Eugene Kandel, Director of the National Economic Council and Avi Hasson, Chief Scientist of the Ministry of Economy. Professor David Gilo, Director of the Israel Anti-Trust Authority, Ohad Cohen, Head of the Foreign Trade Administration, and Yitzhak Ben-David, Deputy Director General from the Ministry of Agriculture also participated in addition to officials from the Israel Tax Authority, Ministry of Foreign Affairs, and Ministry of Science, Technology and Space.


The U.S. delegation included Assistant Secretary of State for Economic and Business Affairs Ambassador Charles Rivkin (US Co-Chair), Deputy Assistant Secretary of Treasury for Middle East and Africa Andrew Baukol (US Co-Chair), and U.S. Ambassador to Israel Daniel Shapiro as well as other officials from the Departments of State, Treasury, Commerce and U.S. Trade Representative, and the U.S. Embassy in Tel Aviv.


The U.S.-Israel Joint Economic Development Group, which has met since 1985, is the premier U.S.-Israel bilateral economic dialogue.







The Economy Ministry, via its Investment Center, will invest NIS 33 million in subsidies of higher salaries for employees working for factories and companies located in national priority areas. An extra NIS 27 million will be invested in promoting high salary employment within the cyber industry. Total Economy Ministry in these two tracks: NIS 60 million.

Conditions for the financial assistance: at least 60% of new employees must reside in the national priority areas. The Economy Ministry expects that this financial aid will provide employment to graduates of academic institutions located throughout the priority areas (most of which are in the periphery), particularly in the fields of high tech, engineering, programming and other well-paid professions.

Economy Minister Naftali Bennett: " National priority areas in Israel represent one of the largest business opportunities in the Middle East today. There is great importance in government intervention, in order to create an appropriate ecosystem to attract leading international and Israeli companies that will set up the base of their operations in these areas."

Economy Ministry Director-General Amit Lang recently signed a directive that defines two additional tracks for assistance in employment in the national priority areas. The Director-General's directive, which aims to promote and develop the national priority areas and help recruit more employees into Israeli businesses (in accordance with government decisions 1272 and 546), will be published in the coming days as part of the Director-General's directive 4.18. The financial assistance will be distributed via the Ministry's Investment Center.

The track is aimed at companies and factories with an annual turnover higher than NIS 100 million (in the year prior to application), that are committed to establishing an initiative or business, expanding an existing factory in the national priority areas or relocating a factory to the national priority areas.

Within the cyber track, the company is also required to meet the definition "Cyber Company" and to establish or expand its activities in one or more "designated settlement" as described in the directive.

The conditions of this financial assistance: at least 60% of the new employees must reside in the national priority areas. Employers, who request salary subsidies within the tracks, are required to pay newly hired employees salaries that are 2.5 times higher than the average salary in Israel. Salary subsidies will decrease on a sliding scale each year - in the first year, up to 40% salary subsidy will be given within the cyber industry and up to 35% in the general track, whereas in the fourth year, salary subsidies will be reach 25% in the cyber program and 10% in the general track.

Economy Minister Naftali Bennett: "National priority areas across Israel – and particularly the Negev - represent one of the largest business opportunities in the Middle East today. I am not a big believer in government intervention although, in this regard, it is very important for the government to intervene so that an appropriate ecosystem can be created within these areas to attract leading international and Israeli companies. I believe that the factories and companies who will be attracted into these areas following government intervention will discover its huge potential."

Investment Center Director Nahum Itzkowitz: "The new tracks were created to assist in the recruitment of highly-paid employees while emphasizing on increasing the rate of growth and encouraging the creation of highly-paid positions within the national priority areas. We assist investors who are interested in establishing or expanding initiatives with highly paid employees in the national priority areas or in relocating a company or factory to these priority areas. The assistance is given via partial salary subsidies of highly-paid employees".





In total, the ministry will allocate NIS 8 million in 2014 to residents in the periphery for tourist business development and the establishment of tourist accommodation.
The grant for establishing tourist accommodation: up to 24%
The grant for small tourist businesses: up to 30%

Tourism Minister Dr. Uzi Landau: "Tourist accommodation and small businesses are the core of tourism in the periphery. The Tourism Ministry which I lead will continue to encourage an increase in supply and competition and will make investments that will strengthen tourism in the periphery, create new jobs and turn the Gaza periphery into an attractive tourism destination for domestic and international tourists."

Tourism Ministry Director-General Amir Halevy: " In recent years, the Tourism Ministry has invested hundreds of millions of shekel in creating a larger and more varied tourism product in the periphery for the benefit of the wider public and in order to create new jobs - investments that have brought billions of shekels into the economy."

The Tourism Ministry has published directives concerning grant allocations for the establishment of tourism accommodation and for small tourist businesses in the Gaza periphery, Negev, Nazareth, Acre, Druze and Circassian villages and in the villages that are located along the Gospel Trail.

In keeping with the directive, the ministry will give grants of up to 24% of the total investment for the establishment of accommodation units and grants of up to 30% for the establishment of small tourist businesses. The grants will be allocated according to the following procedures:

1. Assistance in the Gaza periphery and Negev areas in keeping with the policy of the Tourism Ministry and the government to promote development of the tourism product as a means of assisting and strengthening the economic infrastructure of the communities that are under security and economic threat.

2. Assistance for communities living alongside the Gospel Trail, Nazareth, Acre and the Druze and Circassian villages of Daliat al Carmel and Ussfiya in keeping with the government decisions as related to the multi-year program for economic development of communities in the minorities sector and advancing them in terms of employment and social issues in the field of tourism.

Grants for establishing tourist accommodation:

NIS 500,000 for entrepreneurs living in Daliat al Carmel and Ussfiya

NIS 500,000 for entrepreneurs living in Nazareth

NIS 1 million for entrepreneurs living in the Negev and Gaza periphery

NIS 1 million for entrepreneurs living in the Druze and Circassian villages

NIS 1 million for entrepreneurs living in Acre

NIS 500,000 for entrepreneurs living near the Gospel Trail

Grants for developing small tourist businesses:

NIS 500,000 for entrepreneurs living in Daliat al Carmel and Ussfiya

NIS 500,000 for entrepreneurs living in Nazareth

NIS 1 million for entrepreneurs living in the Negev and Gaza periphery

NIS 1 million for entrepreneurs living in the Druze and Circassian villages

NIS 500,000 for entrepreneurs living near the Gospel Trail

Requests for assistance to be filed by 1 March 2014 to the RuralTourism Division at the Tourism Ministry



The opening day ceremony of the Stock Exchange took place on Wednesday, March 26, in Aviv University, in occasion of the National Science Day, with the presence of the Governor of the Central Bank of Israel, Dr. Karnit Flug, the Stock Exchange General Manager, Mr. Yossi Beinart, the Stock Exchange Chairman Substitute, Dr. Ron Malka, General Manager of the Science and Technology Ministry, lawyer Bina Bar-On, and Tel Aviv University President, Prof Joseph Klafter

The opening day ceremony of the Stock Exchange took place on Wednesday, March 26, in Aviv University, in occasion of the National Science Day, with the initiative of the Science and Technology Ministry

The event was opened by the Stock Exchange General Manager, Mr. Yossi Beinart, who said: "There is great importance in strengthening the connection between science, technology, industry and financial market. This connection contributes to the to the innovation processes that serve as important sources to advancement and economic growth. The encouragement of the connection between science, technology and industry enables developments that can serve as basis for implementable ideas in industry, for production that will improve the living conditions and to economic growth for the benefit of all. The financial and stock markets are significant factors in these processes".

The Tel Aviv University President, Prof Joseph Klafter, said: "The rising of awareness to science in this day can encourage youngsters to study different science disciplines. This science day will enable a glance to break-thru researches conducted in universities. The university is a huge start-up of creativity and innovative ideas". Prof Joseph Klafter also indicated that "science shapes all aspects of our lives, from security to medicine. We live in a fascinating period of accelerated scientific development, where technologies and scientific developments reach massive use with unprecedented speed".

The Governor of the Central Bank of Israel, Dr. Karnit Flug, surveyed the payment means in the market. She enumerated the layers that compose this "tubing" in the financial system, and explained the roles of the Central Bank in the regularization and protection of the payment and clearing systems. Then, she enumerated the different means of payment - the traditional ones, based on paper, and the new ones, based on technology - and described the advantages and disadvantages of each.

Dr. Flug then noted: "The Central Bank of Israel promoted reforms and steps intended to make the new means of payments easier and safer. Among these: development of a payment system for immediate clearing called Real Time Gross Settlement (RTGS), joining to the CLS international system, payment system law and improvement of the different clearing systems. In addition, the Locker committee, which is expected to publish her conclusions soon, will encourage the increase of the use of electronic payment means".


Photo: Open University of Tel Aviv Stock Exchange. Left to right: Exchange CEO, Mr. Yossi Beinart, CEO of the Ministry of Science Bina Bar - On, Governor of the Bank of Israel, Dr. Karnit Flug, president of Tel Aviv University, Prof. Joseph Klafter and Deputy Chairman Exchange Dr. Ron Malka 
Photo: Kobi Kantor

Israel – Russia:  11th Mixed Economic Committee to be convened in Moscow

Tomorrow, Monday 9 December 2013, the Israel-Russia Mixed Economic Committee will convene in Moscow. This will be the Committee’s 11th meeting. Foreign Minister Avigdor Liebermann will head the Israeli delegation, accompanied by Deputy Foreign Minister Zeev Elkin. The Russian delegation will be headed by Deputy Prime Minister Arkady Dvorkovich.

The Mixed Committee, headed by the Foreign Minister, constitutes the highest level inter-ministerial forum for relations between Russia and Israel. The Committee discusses a number of diplomatic and economic issues of great interest and importance for both sides.

In the past four years, the Economic Committees met annually, alternating between Jerusalem and Moscow.

In the coming meeting discussions will address trade issues including a free trade agreement  with the trilateral customs union (Russia, Kazakhstan, Belarus), customs issues regarding exports of fresh agricultural produce from Israel to Russia, cooperation in technologies and management of water resources, cooperation in the field of oil substitutes for transportation,  renewable energies,   relations between Russian and Israeli companies in the area of investments in natural gas, scientific cooperation, space, foreign trade insurance, and cooperation in tourism. The issue of signing a pensions agreement will also be addressed.

In recent years, there has been a significant increase in trade between Israel and Russian, reaching a current  $3 billion a year. A number of agreements will be signed at the end of the talks.