National Economic ConferenceBank Leumi CEO: The business sector’s role is to bring foreign investors back to Israel
National Economic Conference
Bank Leumi CEO: The business sector’s role is to bring foreign investors back to Israel
Hanan Friedman spoke at Calcalist and Bank Leumi’s National Economic Conference about how in order to overcome the current crisis "all parts of Israeli society must share the burden."
"We must create the right conditions to give foreign investors confidence in the strength of the Israeli economy. It’s our responsibility to ensure that the Israeli economy continues to move forward," said Hanan Friedman, CEO of Bank Leumi, at Calcalist and Bank Leumi’s National Economic Conference. "The business sector's role is to bring foreign investors back to Israel."
Friedman recounted that on a visit to the U.S., he met a senior partner at a fund considering investing in the bank who asked him, "How do I know that if I invest in Bank Leumi, I’m investing in a bank in a country that will still exist after the war?" Friedman said it took him a few moments to realize that it was a serious question. He highlighted several points with the partner and asked him to decide for himself. He spoke about the many Israelis abroad who, since the start of the war, had returned home to serve in the reserves, the commitment of Israeli high-tech to keep delivering, a commitment that the world recognizes, as evidenced by the news of Wiz's acquisition by Google. Friedman also discussed the Jewish diaspora, which, despite not being treated well by Israel in recent years, has mobilized with funds and resources to help Israel in its most pressing time.
The investor then pushed back and said "I'm convinced about the past, but how can I be convinced about the future?" Friedman replied that the young people serving in the military, trained to lead with the principle of “after me,” in which officers lead from the front and never from behind, in which every soldier is responsible for each other, demonstrates the commitment of the young generation to the future of the State of Israel. "These young people are our future," he said, adding that the investor was apparently convinced since they decided to invest.
"The economy entered the current crisis under relatively good, solid conditions. Nevertheless, it is important that we maintain and develop some sustainable conditions that will help us get through this period, and just as importantly – future crises. One of the most important conditions for ensuring the growth of the Israeli economy is the successful and full integration of additional populations into the fabric of Israeli life – in the labor market, military service, and civil service. The burden belongs to all of us. It’s important that all parts of Israeli society bear it," he said.
Another condition is the maintenance and enhancement of high-tech. "The latest report by LeumiTech and the IVC Research Center indicates that Israeli tech has made an impressive recovery – this is the first quarter in two years without a decline in capital raising. This is alongside an increase in the number of foreign investors, despite the ongoing war. This is further evidence that Israeli high-tech continues to move forward despite everything and will remain a significant growth engine for the Israeli economy for years to come. The young Israelis who returned from the war after dealing with unprecedented complex challenges, including in tech, returned to their workplaces with groundbreaking initiatives and a drive that will help propel the industry forward."
According to Friedman, another crucial component for the growth of the economy and streamlining processes is the reduction and simplification of bureaucracy: "This is a chronic issue that has not been properly addressed for years. The only effective solution is to look at the processes comprehensively and not sectorally, and make process management digital and data-based and using clear and defined performance metrics. Challenging goals should be set, and those who fail to meet these standards shouldn’t keep their positions."
The fourth condition, Friedman said, is the promotion of national infrastructure projects: "We aren’t heading towards a transportation crisis but a disaster. If [transportation] cannot be dealt with using government funds, it should be transferred to private entities. The concession periods should be extended to reduce the state's share in financing the projects. For everything I have presented so far to happen in practice, dramatic improvements in efficiency in the public sector are needed. We all know that the defense budget will increase in the coming years. Therefore, efficiency is required, combined with the deep integration of advanced technology, digitization, and AI across the public sector, as happens in the business sector, to make it more user-friendly for us - the citizens."
Friedman shared that last week he participated in one of the world's largest banking conferences and was asked how it’s possible that after a deep social crisis and nine months of war, the Israeli economy continues to show good signs by international standards. "It is solely thanks to the resilience of Israeli citizens and Israeli youth." He concluded: "My message to all of you is let’s together create the conditions that will allow Israel's growth engines to take it forward."
