Israeli hi-tech to receive NIS 650 million 'first aid' injection

"It is well understood, even by the Finance Ministry, that the hi-tech industry in Israel holds the key to pulling us out of the economic crisis following the coronavirus pandemic."

By EYTAN HALON
Firas Jabbour (C), founder and CEO of start-up Edunation, a social-learning platform, meets with his team at their offices in Nazareth, Israel (photo credit: REUTERS/NIR ELIAS)
Firas Jabbour (C), founder and CEO of start-up Edunation, a social-learning platform, meets with his team at their offices in Nazareth, Israel
(photo credit: REUTERS/NIR ELIAS)
The Israel Innovation Authority (IIA) will inject NIS 650 million ($180m.) into the local hi-tech sector, including funds for researchers to combat the coronavirus, after the Finance Ministry released money frozen since January 1.
A total of NIS 600m. ($165m.) will be transferred to companies that have applied for R&D funding assistance from the IIA since the beginning of the year. A further NIS 50m. ($14m.) will be paid to companies working on coronavirus-related technologies.
Some 1,161 applications for funding have been submitted to the IIA this year. They have not been reviewed due to the absence of a government budget. The IIA said it would implement a fast-track procedure to review them before Passover next week.
“It is well understood, even by the Finance Ministry, that the hi-tech industry in Israel holds the key to pulling us out of the economic crisis following the coronavirus pandemic,” IIA CEO Aharon Aharon said.
“The hi-tech industry is mainly based on private capital,” he said. “Past experience shows that this funding source dwindles in times of crisis. It is the government’s role, via the Israel Innovation Authority, to increase project funding at this time and allow good companies to successfully weather this crisis.”
The IIA said it is working during the crisis to increase flexibility in response to company cash-flow requirements and to reduce response time for R&D funding proposals.
On March 18, the IIA, the Health Ministry and the Headquarters for the National Digital Israel Initiative promised financial support worth NIS 50m. ($14m.) to Israeli start-ups that advance solutions to combat the coronavirus outbreak, offering to fund the majority of development expenses for companies with “breakthrough technologies.”
Since the joint call for proposals, the IIA has received more than 400 applications from start-ups requesting a total sum of NIS 750m. ($207m.). The IIA said it is working to expedite evaluations and decisions within a “short and focused time frame.”
Breakthrough technologies with potential for an “exceptional impact” on healthcare systems or public health will be eligible for support ranging from 60%-75% of their R&D expenditure. Other selected solutions will receive funding valued at 20%-50% of their R&D outlay, the IIA said.