Despite posting significant export growth of of Israeli-produced software this year, the Manufacturers Association of Israel warned on Wednesday that if the government does not increase the country's technology R&D budget, the software sector will not be able to compete with world hi-tech leaders over the coming years.
"The government must do a better job of supporting the development of our software sector and growing the allotments of our incubators," said Amiram Shore, chairman of the software forum in the Federation of Electronic and Information Manufacturers and chairman of the technology company ENT.
"They also must encourage more foreign and domestic investments into Israel's software sector, otherwise, we will be faced with a situation where it will be difficult to continue to produce top-quality products."
According to the Manufacturers Association, software exports grew some seven percent over the last year, reaching $3.9 billion, while software sales to domestic customers increased 9%, or $580 million, to $1.2b. Combined software sales to both foreign and domestic customers increased 7.4% to $5.1b., according to the Association.
Pointing to the strength of the country's software sector, Shore noted that over the last year about 140 software start-ups began operations, a number he said was certain to drop without proper government support.
"The government needs to return to the policies that it introduced in the 1990s when government financing for technology R&D stood at 13% of all investments into Israel's R&D sector. We have the tools necessary to make Israel a very wealthy country based on our technology, but we need the government to help us get there," said Shore.
The country's five largest software companies, according to export numbers, are Amdocs, HP, Check Point, Verint and Retalix, the Association said.