From the time of its establishment in 1948, Israel has been at the forefront of agricultural research & development. Since then, the Startup Nation has evolved from an agrarian powerhouse to a hotbed for high-tech companies’ R&D headquarters.
Under the pressure of its far larger and often hostile neighbors, Israel and its government began to realize that in order to survive it would need to direct much of its resources toward developing technologies.
Just four years later, University R&D hit the Technion Institute, and has since been one of the leading contributors of patents and developments in agriculture, science, medicine, and of course, technology. In 1968, the government elected to establish a national office for a Chief Scientist, often referred to today as Matimop. This department plays an important role in creating the funds for, as well as advising certain R&D projects that have shown their potential. Matimop provides grants to further R&D projects in the areas of communication, electronics, software, and other developments.
Israeli R&D Today
Since the establishment of this office and the appointment of a chief scientist to oversee R&D operations in Israel, dozens of the most influential and successful companies have opted for R&D centers in Israel. According to the Israel Ministry of Foreign Affairs, Israel currently hosts 1,800 R&D-based companies, which together, have generated $20 billion from export of goods. Furthermore, the government budget for R&D has risen substantially, and continues to be the highest among any country. In 2011, Israeli R&D accounted for 4.39 percent of the country’s GDP, considerably more than the United States’ 2.77 percent.
At the Forefront of the Tech World
Israel’s incredible success when it comes to startups is no secret, and some of the world’s largest and most well known companies are firmly grounded in the Startup Nation. Though Israel has exemplified its proficiency and progress in agriculture, academia, the sciences, medical and pharmaceutical advancements, technology has proven to be the chief player in the Israeli R&D industry. Multinational monoliths in the tech sector have R&D centers in Israel, including companies such as Intel, IBM, BMC Software, Cisco, HP, and Motorola.
Among the largest R&D centers in Israel are Intel and HP. Since 1974, Intel has expanded far beyond its first non-U.S. production center, taking responsibility for 20 percent of all high-tech exports, and 10 percent of its total exports. For HP, a large chunk of the company’s business comes directly from Israel. According to Raffi Margaliot, General Manger of HP Software in Israel, 55 percent of HP’s software releases in 2012 were made possible by the company’s center at the Technion Institute in Haifa.
R&D in 2014 and Beyond
Intel Israel team
One of Intel’s Vice-Presidents, Rony Friedman, is confident that regardless of the company’s future, its R&D facilities in Israel will continue to play a major part in the company’s success, and that the relationship between Intel headquarters and Israel will continue to develop and grow.
Israel on the Rise, Again
On the whole, Israeli R&D companies are contributing to the rapid growth in Israeli GNP, which has been rising steadily at around 5-6 percent annually according to the Israel Ministry of Foreign Affairs. Fraught with R&D centers and facilities belonging to the largest and most valuable companies in the world, Israel will hit the ground running in the area of R&D, and undoubtedly continue to stimulate the country’s rising GNP and overall success.
[xyz-ihs snippet=”HowToInvestInIsraelCTA”]
[xyz-ihs snippet=”JonathanPressman”]
