by joe eskenazi
staff writer
Yarom Ariav’s job is something of a paradox. While the director general of Israel’s Ministry of Finance assuages foreign CEOs, politicians and investors with news of Israel’s remarkably stable economy, the past eight months have seen three different ministers of finance — with the one who hired Ariav, Abraham Hirchson, indicted for embezzlement.
Not to mention the inherent instability of the Middle East.
“This could be a record,” said a grinning Ariav of the three different men he’s called “boss” in his brief re-immersion in Israeli government after decades in the private sector.
“On the other hand, the economic policy itself is very stable. No matter which minister or which government we have, we still have the same elements of economic policy: Fiscal discipline and reduction of the tax rate.”
After years of runaway inflation and a lack of control, the stern regulations the Israeli government has placed on its fiscal policy are impressing investors and CEOs in the Bay Area and throughout the world, Ariav claimed.
“The key is to have the credibility. Israel just last month passed a budget that says, OK, we have a certain deficit of 1.6 percent and it will not be more than that,” said the director, who toured the Bay Area this week, meeting with Israelis and Americans with an eye on the Israeli economy.
With his compass needle always pointed toward Silicon Valley, Ariav breaks his job into two major components: Urging massive companies (your Dells and Intels) to expand their Israeli operations — “opening development centers in Israel with, let’s call it, Israeli brains” — and serving as a matchmaker between Israeli startups and American management experts or investors.
While there are Israeli joint ventures with Boston- or Philadelphia-based companies, the Bay Area is still “the place” for internationally minded Israeli businesses; one looks to the Bay Area for high-tech innovation in the same way one eyes Hollywood for film production.
“There are many Israeli companies who open branches here. That is what the next step should be if they want to be global. I still look at the Bay Area as the mecca of high tech. This is the place,” said Ariav in a San Francisco interview.
Or, in a nutshell, “This is Silicon Valley!” shouts Zvi Chalamish, the chief economist at the Israeli Ministry of Finance’s New York office, from across the room.
While high tech endeavors take up much of Ariav’s attention, they don’t hold a monopoly. More and more, he is working to spread Israel’s desalinization and solar technology worldwide. Naturally, Israel is a market leader in both: “In Israel, we are in a desert … and we have the sun. On every roof you will find solar panels.”
After a pause, Chalamish again shouts, “And we have no oil!”
So while Ariav is never sure who his next boss may be, he’s always certain that the strangely resilient Israeli economy will keep chugging along.
“With all these external shocks, all the ministers and not even mentioning the war in Lebanon and Hamas taking over Gaza, it looks like the economy has stayed on track,” he said.
“It looks like it’s working.”
CopyrightJ, the Jewish news weekly of Northern California