Looking to build on this year's successful $25 million northern business revitalization campaign, the Milken Institute and the Koret Economic Development Fund have initiated the Galilee Finance Facility, a project aimed at strengthening and developing the northern economy.
The idea for the project came as a result of the Milken Institute's Financial Innovations Lab, held earlier this year, which focused on economic recovery and development in northern Israel. The Milken Institute's Israel Center accelerates and supports Israel's path toward economic independence and broad-based prosperity through capital-market development, financial innovation and job creation.
"While everyone is focused on raising emergency money for bomb shelters, which is important, but is only for temporary situations, what we are trying to do with this project is essentially erase what we now know as the periphery of the country," Glenn Yago, director of Capital Studies at the Milken Institute and director of the Institute's Israel Center, told The Jerusalem Post on Monday. "Once an area is labeled as peripheral, it is totally discounted and this is what our initiative is setting out to change."
The Galilee Finance Facility (GFF) will map out 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.
"We are very concerned that the money that was loaned to northern businesses is not going to be able to be put to proper use - we had an enormous inflow of capital allowing for small business development, but now we need to supply large projects for these businesses to support themselves with," Yago said. "Additionally, in an economic analysis of the North that we conducted last year, we discovered that citizens in the North had suffered from a 30 percent cut in median salary, poverty levels reached some 30% more than in other areas of the country and the region recorded high levels of out migration."
The plans include the construction of a solid waste recovery center (none of which currently exist in the Galil), an authority to develop the coastline of the Kinneret as well as the integration of all the railway lines in the northern region, eventually making Haifa accessible by rail from Jordan. "Wouldn't it be great for both of our economies if we could give [King] Abdullah [of Jordan] access to the Haifa port," Yago asked.
Prior to the establishment of the GFF, there has never been one single authority that has looked at the whole economic picture and then planned accordingly, Yago noted.
"None of this has ever happened before because until now economic development was improvisational - take one area here and one area there - and it is hard to do effective economic development when it is fragmented," he explained. "If we want this to go through, it is up to us to grab the future with both hands and make sure that it happens."
According to Yago, strengthening the economic security of this country is crucial - from both an economic point of view, as well as from a security point of view.
"The more that we develop the economy of the northern region, the greater the motivation will be from the government to hold on to that region and defend it as best as possible, while also serving as a deterrent to our enemies from attacking us."
While the local government will contribute funding towards the projects undertaken by the GFF and Yago hopes that the US treasury will also fund the projects, a large portion of the money will have to be privately raised, which will include selling regional Galilee bonds.
"We think that these bonds will have an even greater appeal than regular Israel bonds," Yago said. "Invest where Jesus walked - now that will attract people to what we are selling."
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