Ministry of Industry, Trade & Labor
30 Agron St.
P.O. Box 299, 91002 Jerusalem
Tel. (02) 6220220
Fax. (02) 6245110
Websites:
http://www.tamas.gov.il/(Hebrew)
Investment Promotion Center(English)
Center of Incubators for Technological Initiative(English)
Economic and Trade Representatives Abroad
Functions and Structure
The Ministry of Industry and Trade implements government policy in several
major economic domains. Within these parameters, the Ministry pursues
various goals that may be summarized as follows:
-
Developing and consolidating efficient, profitable industry
capable
of contributing to economic growth, increasing national product
(especially
industrial exports), furthering economic progress, and integrating
Israel's
economy into that of the developed world.
-
Developing Israel's foreign trade by consolidating international
economic relations through membership in economic organizations and
international customs agreements, and by monitoring changes in
international
trade. Such activities are designed to promote exports, reduce imports,
and
improve the balance of payments.
-
Improving trade and marketing methods, promoting the establishment of
large, modern retail chains.
-
Ensuring consumer protection and well-being through legislation,
direct
Ministry intervention, and encouragement of consumers' organizations.
-
Ensuring regular and emergency supplies of vital basic food
commodities
at controlled prices.
-
Dispersing the population and developing economic infrastructure in
peripheral areas.
The Ministry's organizational structure takes account of the need to
attain
the aforementioned goals through the efficient use of resources. The
Ministry is composed of professional offices assisted by staff and service
units. The professional offices are the Food Division; the Metal,
Electric,
and Electronics Industries Division; the Chemical and Mineral Division;
the
Textile and Light Industry Division; the Diamonds and Precious Stones
Department; the Commerce, Artisanship, and Small Industries Department;
the
Consumer Division; the Government Trade Administration; and Israeli Film
Promotion. The staff units are the Investments Center; the Financial Aid
and
Government Corporations Administration; the Foreign Trade Administration;
the Office of the Chief Scientist and Research Administration; Planning
and
Economy; Development Areas; Economic Information Systems; the Israel Fibre
Institute; and the National Physics Laboratory. Several institutions,
corporations, and research agencies are organizationally affiliated with
the
Ministry; they operate under full or partial Ministry auspices, and
Ministry
employees are appointed to their boards.
The head office professional and staff units discharge their duties
through
regional offices that function as the Ministry's executive agencies in the
field, handle liaison between citizens and Ministry authorities, and
provide
the best possible service on site.
A committee examined the performance of the Ministry's regional offices
with
intent to find ways of improving the efficiency and efficacy of their
services. The regional offices are girding for the concerted, planned
implementation of the committee's recommendations.
The Foreign Trade Administration sets and implements
Israel's foreign trade policy, with primary emphasis on promoting Israeli
exports and penetrating export markets. The administration is responsible
for FTA (free trade area) negotiations with the European Communities and
the
United States, for administering such agreements, for multilateral GATT
negotiations, and for setting import and export policy in keeping with
these
agreements with intent to improve access to foreign markets.
The administration also attends to all aspects of foreign trade relations
and export promotion. Some of these activities, meant to improve Israeli
access to foreign markets, are carried out abroad by the Ministry's
commercial attach‚s, who are at the service of all exporters.
Export promotion and finance is a cardinal Ministry objective and a
cornerstone of government economic policy. The export process may be
promoted at two stages: manufacturing and marketing.
Manufacturing: Export promotion at this stage is conducted by
means
of a foreign-exchange fund that dispenses loans.
Marketing: Several marketing funds complement the support given
at
earlier stages. The best-known is the Export Shipment Fund, through which
exporters obtain credit on international market terms. The Export
Promotion
Fund furthers Israeli firms' overseas sales promotion efforts, including
export companies embracing several small and start-up enterprises.
The Israel Export Institute is a public nonprofit
organization that provides information and instruction at symbolic fees
for
exporters and manufacturers trying to break into export markets. The
Institute organizes exhibitions abroad and sponsors other overseas
activities to promote exports. Ministry-recognized export companies
receive
grants equivalent to 2.5% of turnover.
The Investments Center is enabled by the Encouragement of
Capital Investment Law (ECIL) and pursues the objectives of this
legislation: development of production capacity, efficient utilization of
economic resources and capabilities, and full use of existing plants'
production capacity; improvement of the balance of payments by reducing
imports and increasing exports; immigrant absorption and planned
dispersion
of the population throughout the country; job creation; and implementation
of government policy for the promotion of industry in development
areas.
The metals and electronics industries have been industry leaders in
equipment and R&D investments. Electronics alone account for 50% of
investments in industrial R&D. Massive investments in production
equipment,
R&D, and new technologies and manufacturing methods have triggered
far-reaching developments in production and quality with no increase in
headcount.
Below are the five subsectors of the metals and electronics industries:
Basic Metals: The smallest of the subsectors, constituting 7% of
these industries, is composed of relatively conservative businesses that
manufacture chiefly for construction and infrastructure. Among its
products
are pipes; steel, aluminum, and brass sections; structural steel; wire;
nails; screws; mesh; fences; electrodes; doors; windows; metal shutters;
and
foundry products and wrought metals. Output was down 6% in 1989; a sharp
downturn in the first half of the year was followed by the beginnings of a
recovery triggered by the onset of large-scale immigration.
Metal Products include consumer goods (cutlery, pots, fans, refrigerators,
ovens, air conditioners, razor blades), industrial and agricultural
instruments and implements (cutting tools for metal and wood, sharpening
stones, faucets, valves, piping accessories, and sprinklers), and
armaments.
Machinery: This subsector embraces small and medium-sized firms
that supply machinery and equipment to other industries - especially
chemicals, petrochemicals, food, and metals - and to agriculture and
utilities.
Electrical Equipment, Electronics, and Software: This subsector
has
been the industrial growth leader from the late 1960s. Growth was
initially
driven by increased defense consumption; since the mid-1970s, exports have
been the major factor in growth.
Transport Vehicles: This subsector includes the manufacture of
spare parts; manufacture of frames and chassis for military vehicles,
tankers, trailers, dump trucks, garbage disposal equipment, and buses; and
repair and manufacture of boats. The central component in production,
however, is the manufacturing of aviation components, systems, and craft.
Since the aviation industry exercises great influence on the subsector,
and
since aviation projects are generally long-term, sales to both domestic
and
export markets tend to fluctuate considerably.
Consumer Services and Price Controls: The Consumer
Department implements consumer-protection laws for which the Ministry is
responsible, e.g., the Commodities and Services Price Control Law, the
Consumer Protection Law, and the Weights and Measures Ordinance. The
department's subagencies provide consumer services and protect local
products. The public is increasingly consumerism-conscious, filing
thousands
of complaints during the year with the Ministry, the Consumer Council, and
various consumer organizations; these agencies did their best to help
consumers by contacting suppliers and giving advice. In many cases
criminal
offenses were discovered, criminal files opened, investigations
undertaken,
and charges brought.
Consumer legislation continues to advance. The Consumer Protection Law
5741-1981 was amended for the first time in May, 1988, after which the
Knesset Finance Committee debated legislation restricting advertising
aimed
at minors. Thus far, regulations based on this law have been issued
regarding product labelling, credit sales, special and door-to-door sales,
calculation of per-annum interest rates, reasons for cancelling sales of
spare parts, and the details that must appear in contracts connected with
non-bank loans.
The Office of the Chief Scientist promotes industrial R&D
and, consequently, increased industrial exports. Israel's abundance of
high-quality manpower warrants a national strategy for the development of
high-tech industry. Recent years' experience, however, shows that R&D
cannot
attain commercial success in the absence of marketing and business
endeavors. Hence the Office emphasizes its inquiries about the marketing
and
business aspects of the programs filed with it. The development of modern
Israeli industry may also ease the absorption of scientists and engineers
-
immigrants and non-immigrants alike.
The Chief Scientist, the Minister's advisor on industrial R&D and his
representative in relevant scientific and technological activities in
Israel
and overseas, helps shape Ministry policy in this field. The office
applies
Ministry policy in industrial R&D disciplines and subjects, and helps give
industry a strong "push" in the desired direction.
Assistance from the Office of the Chief Scientist is not limited to R&D;
it
has expanded in recent years to include market feasibility studies and,
with
regard to start-up firms, the transition from R&D to sales. The goal of
the
transition stage is to help companies produce prototypes for selected
users,
soliciting feedback that affects the final coalescence of the product. In
keeping with recent decisions, the office will soon introduce additional
support programs for technological incubators and centers of excellence in
research institutes, and will help immigrant scientists find jobs in
research facilities.
Diamonds: All diamond output is earmarked for export. The
diamond industry is composed of some 700 production facilities, most of
which are small workshops with an average of 10-20 employees. (Only 15
diamond firms have more than 100 employees.) Most commercial activity
takes
place at the Diamond Exchange in Ramat Gan.
The Israel Film Center promotes the film industry by
supporting the development of film-production infrastructure and
facilitating production by Israeli firms and visiting foreign
companies.
The Quality Israeli Film Promotion Fund was established in 1989 in
conjunction with the Ministry of Education and Culture. The Fund's primary
objective is to encourage Israeli companies to produce feature-length
films
that will improve the caliber and quality of Israeli films as well as the
marketing and distribution possibilities of such films in Israel and
abroad.
Sources: Israel Ministry of Foreign Affairs |