Israel’s reputation as a country bereft of natural resources, surrounded by a sea of oil, is not entirely true. The Dead Sea contains rich deposits of minerals and there are major reserves of phosphates in the Negev desert. Together with local technological expertise and innovative industrial processes, these resources are the basis for a large and sophisticated chemicals industry.
Since the 1980s, this industry has rapidly developed its ability to extract minerals and create high-value end-user products such as fertilizers and pesticides, petrochemicals and plastics. With a small domestic market, most of the products are sold overseas; indeed, many of the companies in the chemicals and petrochemicals sectors are large corporations with an increasingly global reach. In the past five years, some $1.3 billion has been spent acquiring foreign companies, principally in Europe and Latin America, strengthening the industry’s marketing capacity.
In 1999, resource-based industrial exports reached nearly $3 billion. Sales of chemicals have tripled over the last decade, amounting to $8 billion some 14% of the country’s total industrial production.
Agro-Technology
Because Israeli farmers and scientists have had to contend with a difficult environment and limited water resources, their experience is especially relevant to the developing world. Development of greenhouse equipment, seed and livestock propagation, fertilizers and pesticides have enabled Israeli agriculture to prosper in adversity. In addition, farmers have learned to develop high value-added and innovative farm products that enable them to compete in markets with lower-cost producers. Water management, recycling, desalination and transportation in the National Water Carrier have enabled the country to overcome drastic shortages.
Transportation
Although Israel is a very small country – some 470 kilometers (290 miles) long, and only 135 kilometers (85 miles) across at its widest point – it has a well-developed network of roads and railroads, as well as modern ports and airports. However, infrastructure development failed to keep pace with rapid population growth, boosted by the arrival of some one million immigrants over the last decade, and by a surge in economic growth and rising affluence. In response, much greater priority was given to investment in transport during the 1990s, and the government is now seeking to upgrade the transportation sector across the board, to introduce greater competition and to encourage private enterprise…
The Communications Industry
Israel requires state-of-the-art telecommunications to maximize the potential of its highly advanced and globally oriented economy. Over the last decade, the telecommunications sector has been transformed from a sluggish state-owned monopoly into a competitive market offering a variety of advanced services, many of them based on innovations developed by local companies. The number of telephone lines, mobile phones and Internet connections places Israel high in world ratings, and for most services, tariffs are relatively low. This has made telecommunications widely and easily available to a population known for its enthusiastic approach to high technology.
Textiles and Apparel
Israel has succeeded in creating a thriving textile and apparel industry, overcoming the handicaps of a small domestic customer base, distant export markets and high costs. Much of the credit goes to the industry itself, which has adopted high tech manufacturing methods to produce quality and cost-competitive goods, made strategic acquisitions in overseas companies and focused on niche markets where medium-sized and small companies can be major players. Part of the credit also goes to the Middle East peace process, which has enabled companies to move production to lower-cost countries in the region, and to the free-trade agreements which Israel has with two of the biggest apparel markets in the world, the United States and the European Union.
Trip to Israel 