Route to Israeli Peace Must Lead to Industrial Cooperation

Here is an excellent piece I read in this morning's Financial Times by an Israeli industrialist named Stef Wertheimer:

"For 58 years, the people of Israel thought that more land would keep them safe. And we still believe that a good army will guarantee us peace. The land and our army have given us a degree of security but, unfortunately, no peace.

"It would be instructive for us to look at what other countries have done with the question of force. Singapore decided not to use force and to focus instead on mutual interests with its neighbours. The country needed a source of water and its neighbour had a large supply, so Singapore decided to buy water from Malaysia. It could allow itself to become dependent in this way because it was at peace with its neighbour.

"In the Balkans, neighbours quarrelled. They quarrelled about – and used – force until the moment they started working towards acceptance into the European Union. Then their reality changed. They had a new challenge. Whereas force did not work for any of them, competing in the global market has brought peace to the troubled region.

"In the region called the Middle East, there are actually two distinctly different areas; one with too much oil and oil money, and the other – the Mediterranean or “near” East – with not enough of either. Any country or region with high unemployment is automatically in trouble. It can easily become a breeding ground for terrorism. The focus for governance in such areas must be about putting people to work in meaningful employment. When people have jobs, they can easily separate their religious lives from their working lives.

"During 54 years working in Israel’s Galilee region and, more recently, in Turkey, I have learnt there are limitations to using force to win a quarrel. If you have a neighbour, you had better ensure he is not hungry, not jealous and that he has a good job. In the near East – Israel, Lebanon, Turkey, Jordan, the Palestinians and more – over 90m people have no appreciable oil income and need alternatives to military force. The solution is industry and jobs.

"Like many of us, the people in the near East want homes and families. To accomplish this, they need industry. Monetary aid and food does not bring peace. This area needs modern industry, jobs and better education geared to competing in the global market.

"With this in mind, I set up five industrial parks in Israel to provide employment and last year, established my first venture in Turkey. All these parks are based on the Tefen industrial park that I set up in Galilee in 1984. These parks provide opportunities for people from diverse backgrounds – Muslims, Jews, Christians and Druze – to learn and to work together as entrepreneurs, managers and employees.

"This is not a real estate story. It is about a special kind of regional economic development that promotes industrial production for export industries. The parks act as a framework for entrepreneurship. They provide the basics needed to help people start businesses with a minimum amount of money while providing assistance for a maximum effort to enter the world market. But it is not just industry – each of the parks works with an educational institution in the area to provide the park’s local entrepreneurs with the knowledge to run their businesses, and to help local people with the skills to work in the new establishments.

"The Tefen park has changed the local area and created jobs. We have made industry an important part of society. I believe that with the necessary assistance, we can multiply this basic model and, in the short run, save money, lives and nerves. Slowly, but also methodically, priorities will change and spread throughout the near East, taking the region from conflict to peace and security through jobs and industries.

"Compare the cost-benefit ratio of industry with that of a military force. It takes less money to start two industrial parks than it does to finance a fighter jet. That means that starting 100 industrial parks is equal to buying fewer than 50 fighter aircraft. Each industrial park focuses on attracting entrepreneurs, starting companies, educating workers and creating employment. After just five years, the region will begin to see results.

"To set up these industrial parks in this part of the world, we need contributing companies to establish branches in the new parks, as "seed industries." We also need the support and commitment of national governments to set up the incentives that will make investment in their countries or regions attractive to industry.

Stef Wertheimer is an Israel-based industrialist and founder of Iscar, a manufacturer of metalworking tools with operations worldwide