Gov't expected to join financing of huge northern development project

The initiative aims to strengthen and develop northern economy with a number of large infrastructure projects.

By
November 15, 2007 21:58
2 minute read.
Gov't expected to join financing of huge northern development project

galilee forest 298.88. (photo credit: Ariel Jerozolimski )

 
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There is a "high probability" that the government will contribute significant funding to The Galilee Finance Facility, an initiative aimed at strengthening and developing the northern economy through the construction of a number of large infrastructure projects, The Jerusalem Post has learned. The initiative is the brainchild of the Milken Institute and the Koret Economic Development Fund, and was hatched as a result of the Milken Financial Innovations Lab, held earlier this year, which focused on economic recovery and development in northern Israel. "We had a very productive meeting with Glenn Yago (director of Capital Studies at the Milken Institute and director of the Institute's Israel Center) and we were presented with many interesting ideas for financial instruments that will bring together the government and the private financial sector," Prof. Manuel Trachtenberg, the director of the National Economic Council in the Prime Minister's Office, told the Post on Thursday. Also present at the meeting were officials from the Finance Ministry, the Transportation Ministry and the National Infrastructures Ministry The Galilee Finance Facility, a public-private venture, will map out and raise money for numerous large-scale regional projects in the country's northern areas, including transportation, infrastructure, energy, industrial parks, technology incubators, tourism and urban revitalization strategies in an effort to support the northern business sector. The plans include the construction of a solid-waste recovery center, an authority to develop the coastline of Lake Kinneret as well as the integration of all the railway lines in the northern region, eventually making Haifa accessible by rail from Jordan. According to Yago, convincing the government of the project's feasibility was not easy. "We had to convince them that the assumptions they held about financing and constructing the projects were too narrow," he said. "We had to change their assumptions and I think that we were successful in doing that. The National Economic Commission is going to look closely at this; now the project is gaining real traction." Financing for the transportation, solid waste recovery and energy projects, estimated to be in the hundreds of millions of dollars, was the primary focus of the meeting. Trachtenberg, however, is not yet to ready to sign any government checks to fund the initiative. "Right now we need more precise information about each of the projects. He [Yago] presented a compelling case, but before we can officially go forward we would like to receive more details about exactly it is he wants to do," he said. While Yago hopes the US Treasury will also fund the projects, a large portion of the money for the projects will be privately raised, something he plans to accomplish by selling Regional Galilee Bonds.

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