With the Israeli tech sector increasingly jittery over the government’s plan to overhaul the judiciary, nearby Greece is reportedly attempting to lure away some in the lucrative industry.
Greek ministers and diplomats, as well as other senior government officials, held several meetings recently with Israeli entrepreneurs in an attempt to convince them to relocate, Channel 12 news reported Tuesday.
According to the report, the Greek officials made presentations during the meetings, detailing generous relocation packages for the Israeli executives, including tax breaks, fast-tracked citizenship, and the construction of special neighborhoods with schools and offices for them and their families.
Tech workers have been among the various groups vocally protesting the overhaul on the grounds that it will weaken democratic checks and balances. Leading of the sector have warned that the moves will make venture capitalists leery of investing their money in the country. Some have moved their own companies out of the country in protest.
Channel 12 carried a statement from the Greek embassy that did not deny the substance of the report, saying: “Advancing opportunities to raise internal capital in a country is a common practice, as it is in other countries. Greece has the right to do so in a broad range of areas.”
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Ori Hadomi, the CEO of Mazor Robotics, confirmed to the channel the existence of talks between senior Israeli tech executives and European countries regarding relocations.
“The proposal came from countries friendly to Israel that sadly recognized an opportunity,” he said, though he refused to comment on which countries were involved. “I can confirm they are European countries that are seeking engines of growth and are interested in quality manpower. They are recognizing a process whereby there will be an exodus from Israel of people seeking to work elsewhere. They want to be prepared.”
The building housing the Greek embassy in Israel, on Daniel Frisch St. 3, Tel Aviv (screenshot: Google Street View)
Senior Treasury officials on Monday warned Finance Minister Bezalel Smotrich that the government’s proposed judicial overhaul could stunt the country’s growth, resulting in a severe loss of tax revenue and do “very significant harm” to the economy.
They noted that due to the structure of the Israeli economy, the negative impact on long-term growth may manifest quickly, particularly in the tech sector, because of companies’ cross-border operations and their reliance on international funding and skilled workers who may leave the country.
The tech industry is the growth engine of Israel’s economy, contributing 17% of GDP, and is responsible for over 50% of exports and about 25% of payroll taxes. In 2022, foreign capital investments in Israeli high-tech amounted to about $12 billion (not including exits).
The shekel hit 3.7 per dollar in intraday trading this week, its weakest level in four years, as Prime Minister Benjamin Netanyahu’s coalition pushed ahead with legislation that would grant the government control over the appointment of judges, including High Court justices, and all but eliminate the High Court’s ability to review and strike down legislation.
Sharon Wrobel contributed to this report.