Manufacturers, Trade Ministry at odds over help for small exporters

Last week, the Ministry of Industry, Trade and Labor announced plans to invest up to NIS 75m. in a program designed to help multiply exports of 200 small-sized companies in the periphery within a two-year period.

By SHARON WROBEL
November 8, 2006 07:32
3 minute read.

 
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The Israel Manufacturers' Association on Tuesday took issue with the Ministry of Industry, Trade and Labor over what it called a lack of cooperation and exclusion from the ministry's launch of a NIS 75 million support program for small exporters. "Unfortunately, neither we nor the Export Institute took part in the preparations for the export program of the ministry. Instead we had to learn about it in the newspapers," said Shraga Brosh, president of the Manufacturers' Association of Israel, ahead of the Prime Minister's Conference for Export and International Cooperation, which starts today. "I don't think that the clerks of the ministry, who sit in Jerusalem can teach small exporters about how to boost their exports." Last week, the Ministry of Industry, Trade and Labor announced plans to invest up to NIS 75m. in a program designed to help multiply exports of 200 small-sized companies in the periphery within a two-year period. Brosh said Tuesday that such a program needed to include the Manufacturers and the Export Institute, which are in contact with and understand the situation and difficulties of small exporters. In response to the criticism, the ministry said Tuesday in an e-mailed statement that it decided a few months ago to proceed with the support program and that Yechiel Assia, director general of the Israel Export & International Cooperation Institute and its chairman, David Artzi, were included in early talks. Upon the announcement of the ministry plan last week, Assia told The Jerusalem Post that he welcomed the initiative and was "very pleased with the generous budget allocations," although he did express concerns about program. "Small exporters face an array of difficulties from R&D support and market readiness of the product to questions of financing and risk management. However, each company is at a different stage and thus we hope the program will give support to each of the chosen companies individually." The Manufacturers' Association said Tuesday that in recent months it has been working on an assistance program of its own to help small companies boost exports and had notified the treasury and the Ministry of Industry, Trade and Labor. According to its program, which was presented on Tuesday, 300 small businesses with export potential would receive guidance from the Export Institute, which would assist them in opening up to new markets abroad such as China and India. The cost of the program is estimated at $80m. "We believe that by applying our program exports could increase annually by $2 billion within three years," said Artzi. "On this part of the Earth, there is gold on the ground called Israeli technology. What we need is some help to market and sell it abroad." Meanwhile, Eli Yishai, Minister of Industry, Trade and Labor said the ministry's program was expected to start in the first quarter of 2007 with the aim broadening the product range of exporters and increasing job opportunities to bring down unemployment and to raise wages and improve standards of living. "The program will assist companies in boosting their exports, while removing obstacles and allocating helping tools at a budget of between NIS 50m. and NIS 75m. which will increase the exports of small exporters by over $500m.," Yishai said. The program is an experimental one for which a representative sample of 200 small exporters will be chosen with annual export volumes of between $100,000 and $2m. In 2005, the number of exporters with export volumes of up to $2m. stood at 2,500, representing 20 percent of all exporters in Israel. The results of the project would serve as a basis to apply the program to all small exporters across the country. Gaby Maimon, Director-General of Industry, Trade and Labor and head of the project is preparing the ministry program together with a number of other groups including the Chief Scientist Office and the Industrial Cooperation Authority.

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