NY Times: Israel hi-tech booming

According to The New York Times, Israel's hi-tech industry has had its best year in nearly half a decade, and is heading toward a full recovery after the dot-com implosion and outbreak of the intifada in 2000, YNET reported.

Source: YNET

It seems that 2005 was the best year for Israel's hi-tech industry since the dot-com implosion in 2000, The New York Times reported Monday, adding that Intel's USD 3.5 billion investment in a new factory in Kirayt Gat is a shining example for the improvement in the industry.

According to the Times, the hi-tech industry in Israel has nearly recovered completely from the crisis of 2000, and now attracts major players such as Intel, as well as startups and venture capital companies. Israel boasts more than 70 companies registered at Nasdaq, more than any other country in the world outside the United states. The hi-tech sector plays a significant role in the Israeli economy, which is expected to grow by 5 percent this year, the Times reported.

The technology industry contributed to the modernization and reshaping of the local economy throughout the 1990s, and has built a reputation for itself as a fertile ground for innovative startups, which often relocate to the U.S. In 2000, Israel was affected by both the collapse of the industry and the outbreak of the intifada.

For several years Israeli VCs refrained from even holding their annual meetings, because overseas investors were reluctant to attend. However, the Times states that the situation has dramatically changed in the last years, and that investors are now returning to Israel.

According to the central Bureau of Statistics, the number of hi-tech employees in Israel hit a record of more than 66,000 workers in 2000, and then dropped to 53,000 between 2001-2003.

The number has gradually increased, and it now stands at 61,000. Exports of the hi-tech sector totaled USD 13 billion in 2005, which represent 40 percent of all Israeli exports.