A group of 45 leading industrialists from the United States and a dozen other countries began meeting here today to launch an ambitious private campaign to help Israel wipe out its chronic trade deficit and reduce its dependence on U.S. aid.
Called "Operation Independence," the investment effort is geared at "harnessing the energies of the Jewish community in the world" to boost Israeli exports of consumer goods by $500 million -- about one-third of the current level -- and increase tourism revenue by another $500 million in the next three to five years, according to the group's chairman, Detroit industrialist Max Fisher.
Fisher said the campaign would not result in a "quick fix" to Israel's ailing economy, and he predicted that the government would still be dependent on U.S. economic aid for the next five to 10 years "unless they have peace and stability in this part of the world." But, he told a press conference, "It is our ambition to see within the next decade the ability of Israel to start to become self-sufficient."
The difference between "Operation Independence" and a number of previous private campaigns to boost investment in Israel, Fisher said, is the influence in the business world of the approximately 85 members of its North American and international task forces, which include Charles Bronfman, deputy chairman of the Seagram Co. Ltd.; Morton L. Mandel, chairman of Premier Industrial Co.; Felix Rohatyn, a partner of Lazard Freres & Co.; Ed Finkelstein, chairman of R. H. Macy Co.; Sam Belzberg, chairman of First City Financial, and Lord Marcus Sieff, president of Marks and Spencer of England.
"This is a high-powered group that can get things done," said Fisher, the preeminent Jewish fundraiser in the United States.
Prime Minister Shimon Peres, whose government has a "facilitating role" in the campaign, told the group that it could help launch "a new era in the life of the state of Israel," and that "economic independence will enable us to pursue with renewed vigor what we have begun in the political sphere."
With U.S. aid to Israel running at $4.1 billion this year, Fisher said, a warning sounded last spring by outgoing U.S. Ambassador Samuel Lewis has particular significance. Lewis said then that he was happy that the United States could help Israel, but he added in a speech to the Tel Aviv Rotary Club, "I worry for your society so long as we must help in these dimensions."
"I agree with Sam 100 percent," said Fisher. "That's the point of the effort -- to reduce Israel's dependency on U.S. aid."
U.S. government aid to Israel this fiscal year represents about 13 percent of the country's gross national product, not including hundreds of millions of dollars donated by private Jewish organizations.
Fisher said that Israel's $4 billion trade imbalance and dwindling of foreign exchange reserves to less than $2 billion are a result of a lack of investor confidence in Israel's economy. He cited a recent U.S. State Department survey of investors, which showed that the leading negative factor against investing in Israel is not the political instability of the region, but "the general economic climate here."
Israel's inflation rate, which soared to over 1,000 percent last year, is still running at over 300 percent, but is expected to decline as a result of an emergency austerity program adopted in July.
The austerity includes a general wage and price freeze; cuts in subsidies of basic products such as gasoline and food; a 10 percent budget cut and the dismissal of 14,000 government employes, plus a suspension of the wage-indexing system that tied earnings to the cost of living.
Fisher said the drive to stimulate investment would be assisted by the recent free trade agreement between Israel and the United States, and by Israel's emergence as a leader in the field of high technology, particularly in the defense industry.