Indirect exporters get direct support

Companies based in areas deemed "Priority A" (the most needy) will be eligible to receive government money provided that 25% of their products are exported.

May 6, 2007 21:52
1 minute read.

Distributions of benefits are beginning to make their way to many of the country's "indirect exporters" as part of a recently passed law approving government investments and tax incentives for those companies with operations in Israel's most underprivileged regions. "We have been waiting for this decision for a long time, and now we are able to properly assist the country's small- and medium-sized indirect exporters," said Hazi Zaig, director of the Investment Center at the Industry, Trade and Labor Ministry on Sunday. According to the law, which breaks down the need for government assistance based on the regional economic situation in which the indirect exporters are located, companies based in areas deemed "Priority A" (the most needy) will be eligible to receive government money provided that 25% of their products are exported, while those operating in "Priority Areas B or C," will be eligible for the aid only if 50% of their manufactured items leave the country, with an additional requirement for "Area C" companies that their sales reach at least NIS 20 million a year. Since the announcement of the law, which was revealed to indirect exporters last week, the Investment Center has received more than 20 requests for financial support from companies in the country's poorest locales. An expected NIS 65m. will be invested, reported Zaig, with the money being designated to improve operations and hire new workers. The Industry, Trade and Labor Ministry defines an indirect export as a situation in which an Israeli company purchases manufactured products from another Israeli-based manufacturer and then exports the products to markets around the world as a part of a larger product it sells. Danny Laish, spokesman for the Manufacturers Association of Israel, noted that most of the indirect exporters based here, which number in the hundreds, cannot export their products directly because they don't have the infrastructure to do so or because the products they manufacture are destined to be part of a larger finished product. The assistance plan was drawn up by representatives from the Industry, Trade and Labor Ministry in cooperation with the Finance Ministry.

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