Tel Aviv determined to secure place among global elite

Tel Aviv is working to brand itself as a global hub of innovation and entrepreneurship, and a leading urban tourist destination.

A landscape view from the Tel Aviv-Yafo municipality building (photo credit: COURTESY TEL AVIV MUNICIPALITY)
A landscape view from the Tel Aviv-Yafo municipality building
Founded 110 years ago on the sand dunes north of the ancient port of Jaffa, Tel Aviv is today known as the start-up city, the non-stop city and the White City of Bauhaus architecture. Overlooking its modest size of 435,000 people, Tel Aviv has ambitious aspirations - it also aspires to be a leading global city.
Eager to play a significant role in the world economy, Tel Aviv is working to brand itself as a global hub of innovation and entrepreneurship, and a leading urban tourist destination. The indications are that the city is moving in the right direction.
Tasked with making that global ambition a reality is New York City-born Eytan Schwartz, the CEO of Tel Aviv Global & Tourism, a municipal company reporting to the Mayor’s Office at the Tel Aviv-Yafo Municipality.
“A global city is a city that attracts talent from across the globe,” Schwartz told The Jerusalem Post. “In the competition over size and numbers, we will never be a leader. We have to make an extra effort to make things easier and more accessible for foreign talent.”
Unlike major technology hubs in Europe that may boost their economic status by competing for the relocation of enterprises, Schwartz highlights the difficulties posed in attracting foreign talent caused by Israel’s restrictive immigration policies.
Those difficulties have not prevented, however, hundreds of multinational companies engaging with the local ecosystem.
“The sub-niche that has emerged in Tel Aviv is the multinationals coming here, setting up R&D operations, either acquiring existing start-ups and embedding their work in a multinational operation or assembling teams to produce products for the company,” said Schwartz.
“This is an amazing development with very positive outcomes in terms of the connections of the city, the global exchange of ideas and the opportunities it creates. We also attribute a lot of the pains of the sector to this development, including the very high salaries, perhaps the danger it poses to the start-up scene by drying out the talent pool and increasing the danger of relocation abroad.”
The increasing desire of Israeli growth companies to remain in the country, purchase property and recruit local talent, rather than seeking to quickly shift their operations to the United States, is a particularly promising development, Schwartz added.
One sector in which Tel Aviv is currently excelling is smart city innovation. The CityZone innovation laboratory and field experiment center at Atidim Business Park, jointly-owned by the municipality and Tel Aviv University, enables early-stage start-ups and multinational companies to develop technologies and solutions relevant to the real needs of the modern city.
“CityZone is probably the most important project that we are doing right now. A lot of foreign investors and government people have already visited since it opened less than a year ago. That’s the front line of our efforts in terms of smart cities,” said Schwartz, highlighting the June launch of an innovation lab at the site by the Renault-Nissan-Mitsubishi Alliance.
While Israelis often speak about the danger of “brain drain” or human capital flight, Schwartz points to a significant increase in young, well-educated Jews moving to Tel Aviv from overseas. In recent years, Tel Aviv has surpassed Jerusalem as the leading aliyah destination. In 2018, 3,240 immigrants made the city their first Israeli home, compared to just 1,490 in 2009.
“This is a new type of immigration. They might be religious but their motivation is beyond religion. It’s about being a Jew in a very global city,” said Schwartz. “When you talk about brain drain, this is brain gain. Somebody invested in their education $1m., and we gained it.”
In addition to being an attractive center for foreign business, Tel Aviv’s tourism scene has also enjoyed major growth, fueled by Israel’s “open skies” agreement with the European Union, the renovation of attractions, and the Ministry of Tourism’s unprecedented investment in the “Two Cities One Break” advertising campaign.
“The underlying message is drawing a parallel between Tel Aviv and Jerusalem, as if the two cities are equal in importance and attractiveness,” said Schwartz.
“It was historically clear that the single most important destination in Israel was Jerusalem, and a certain percentage of visitors would frequent the beach city of Tel Aviv. If the state recognizes the attractiveness of Tel Aviv as completing Jerusalem, that is an amazing achievement.”
Coping with the unprecedented number of tourists, Schwartz said, obliges Tel Aviv to double the number of hotel rooms in the city. The conversion of older office buildings into hotels, an emerging architectural trend worldwide, is one of the most efficient methods to boost accommodation options.
The city, currently offering 10,500 hotel rooms, welcomed 2.2 million tourists in 2018 alone. In June, the municipality launched its “Tel Aviv-Jaffa 2030” master plan to increase tourism infrastructure.
At the same time, the municipality is adopting an aggressive approach toward the thousands of Airbnb properties in the city, demanding more than double the average municipal tax rates for residential properties. Mayor Ron Huldai has announced that he will push for national legislation to tackle the unregulated vacation rental market.
While efforts to attract foreign companies and tourists are bearing plenty of fruit, Schwartz is conscious of the need to make the developing global brand a reality on the ground. Most complaints made by visitors refer to poor transportation, high prices and the aesthetics of some areas of the city.
“The appearance of the city is definitely the mandate of the municipality. The city is very clean but people come to this treasure called the White City and it is not white. Visitors don’t understand how a UNESCO World Heritage Site looks the way it does,” said Schwartz.
“The Ministry of Tourism and all those involved have done a fantastic job branding the city, and our job is to make sure that the promise of this brand meets a reality which is equal. A lot of our efforts are directed inward to improve the city.”