Israel fails to procure UN tenders

Israeli hi-tech companies account for only about $13 million of the UN's approximate $1b. IT procurement budget.

un building 88 224 (photo credit: Bloomberg)
un building 88 224
(photo credit: Bloomberg)
While Israeli technology is exported and marketed successfully in many countries around the world, "blue and white" products have yet to successfully make a dent in the lucrative multi-billion dollar UN market, a trend UN representatives blame on the fact that the local IT community has not seriously considered the UN to be a viable trade partner. "Israel has not had the opportunity to do business with the UN commensurate with what the Israeli tech sector can offer," Eduardo Blinder, director of the Information Technology Services Department, told The Jerusalem Post at a seminar in Tel Aviv focused on doing business with the UN that was sponsored by the Israel Export Institute and the Foreign Ministry. "There is a perception among Israeli hi-tech companies that the UN sees Israel not very objectively ... they think that they aren't welcome and it is not even worth it for them to try and make a bid on a UN tender because they are not going to get it." He denies that, however, saying Israeli companies have just a good a chance of procuring UN business as does anyone else. "I am convinced that there is no prejudice at the UN and there are transparent and clear rules of how procurement procedures work," he stated. "In fact, the UN will go out of its way to have the highest number of bidders participate in a tender, including those from the world's least developed countries." According to Blinder, Israeli hi-tech companies account for only about $13 million of the UN's approximate $1b. IT procurement budget, a number he believes can increase substantially if hi-tech CEOs change their approach when it comes to selling to the UN. "Israel has an export-oriented economy and over recent years its technology sector has advanced to the point where it can offer cost effective goods and services ... but every time I have had contacts with Israeli companies the permeating attitude was the 'UN doesn't want Israel - so why bother,'" he said, adding that when he met with a certain Israeli technology company during his current trip here, he encountered a great deal of arrogance and impatience. "They were not interested in a million dollar contract that would take a year to complete, but what they don't realize is that once a company establishes a relationship with the UN, they can do very well." Blinder noted, however, that this attitude is slowly beginning to change, largely due to the influence of the new Israeli Ambassador to the UN, Dan Gillerman. "There seems to be more of a deliberate approach to get Israel more involved in general affairs and the overall values that the UN espouses," he said. "Israel is participating more in the machinery of the UN and change is occurring as the realization that things could be different set in." Nevertheless, Rony Adam, the director for UN political affairs in the Foreign Ministry, believes there is a long way to go. "The reason I initiated this event was in the framework of increasing Israel's interaction with the UN - if the image of the UN will improve in Israel, meaning Israel connecting more to the global agenda, then Israel can find ways to benefit from the UN, mainly in the economic sector." Adam noted that the negative trade deficit with the UN continues to grow, with Israel purchasing $45m. worth of goods and services from the UN last year while selling just $30m. "This can change and, in fact, I meet people at the UN who are interested in doing business with Israel, but the country first needs to broaden its perspective." Although the Export Institute expects sales to the UN to increase by some $10m. by the end of 2007, the institute's director general, Yechiel Assia said this was not enough. "Israeli companies are performing way below their potential when it comes to exporting to UN organizations," he said. Blinder, meanwhile, believes that with the right combination of marketing savvy and hard-work, Israel can become a major player in the UN market. "There is no reason why they can't command 10% of the IT budget, he said, "but if they don't market themselves and if they don't compete in the tender process, the UN will find someone else to buy from."