Israel ‘needs national AI program’ to lead global hi-tech

Countries including China, South Korea, France, Taiwan, Singapore and Canada are among those to make hefty, even multi-billion dollar, investments in artificial intelligence strategies to date.

JANUARY 14, 2019 03:57

Updated: JANUARY 14, 2019 06:14

Israel Innovation Authority CEO Aharon Aharon (photo credit: Courtesy) — Israel Innovation Authority CEO Aharon Aharon

(photo credit: Courtesy)

Israel needs to implement a national-level artificial intelligence strategy in order to maintain its position as a global hi-tech industry leader, according to Israel Innovation Authority CEO Aharon Aharon.

Speaking to The Jerusalem Post ahead of the publication of the Authority’s annual report on Monday, Aharon said that “Israel is lagging behind other countries, but can still catch up, should the government put a national plan in place.”

Artificial intelligence is expected to serve as the foundation for the latest surge in the digital revolution, in fields such as autonomous vehicles, personalized medicine, precision agriculture, mobile robots and computing, the report said. Global competition over leadership in artificial intelligence is also increasing.

Countries including China, South Korea, France, Taiwan, Singapore and Canada are among those to make hefty, even multi-billion dollar, investments in artificial intelligence strategies to date.

“The private sector is doing their job,” said Aharon. “Lots of companies are already there and very active, but there is a need for a national program constituting of three elements.”

The authority’s proposal includes, firstly, augmenting human resources capable of staffing Israel’s expanding artificial intelligence industry; secondly, reinforcing research infrastructure in academia; and thirdly, the development of research and development infrastructure which serves both academia and industry, such as the accessibility of data sources that are government-owned.

“When we talk about Israeli leadership in the hi-tech industry and innovation, we don’t take into account that we started former innovation races when the competition provided by other countries was very low,” Innovation Authority Chief Strategy Officer Uri Gabai told the Post.

“Today, nearly every country and government understands that innovation is the only viable way for economic growth. It’s a new race and we can’t say that we were leading for the last 20 years. This is the flag that we’re raising as the Innovation Authority.”

The report also details how Israel can take advantage of its competitive advantage in the global biopharma industry, as it strides towards a new age of personalized medicine.

Israel’s biopharma industry is currently made up of roughly 200 companies, with Israeli venture capital funds investments in pharmaceutical technology increasing by almost 400% between 2012 and 2017.

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The Innovation Authority believes that the combination of Israel’s unique genomic and medical data sources, in addition to its rich success in scientific innovation and convergence of biopharma and ICT, could see personalized medicine represent a lucrative turning point for the Israeli biopharma industry.

While Israel excels in technology development, the report details a substantial discrepancy between innovation creation and the penetration of innovative technology into everyday Israeli life, which is both critical for economic prosperity and towards the quality of life.

“The productivity of other sectors is lagging behind other OECD countries, sometimes by 20% or more,” said Aharon, referring to vital industries including transportation, commerce, construction, education and public services.

“This cannot be sustainable because the economy is mostly maintained by these sectors. Also, we don’t think regulation will protect the market. We need to introduce innovation in those markets that are highly-regulated or are without competition at this stage. In the long run, they will face competition and the market will prevail.”

In order to reinforce the link between Israeli hi-tech companies and other domestic sectors, the Innovation Authority launched a track last year to provide funding and regulatory support to technology pilots, which was conducted mainly in Israel.

By these programs in Israel, hi-tech companies are granted a boost and the local economy benefits from innovative technologies. The authority has supported pilots in a variety of fields, including environmental protection, energy, smart transportation, digital health and cyber safety.

Israel is also expected to join the World Economic Forum’s Center for the Fourth Industrial Revolution network, which aims to consolidate and share its best practices in the field of regulation of innovation. Through the network, the Innovation Authority will operate an Israeli center to work with local regulators and set regulatory guidelines for future technologies that are similar to global standards.

Seeking to broaden the impact and success of Israeli hi-tech, the Innovation Authority is promoting Israel’s innovation-driven economy in the periphery, to benefit both regional economies and the national innovation system.

Today, 77% of start-ups are located in Tel Aviv and in central regions. Therefore, harnessing the human capital potential in peripheral regions is critical given the current shortage of hi-tech workers in Israel.

“When we look at the center of Israel, we have basically exhausted the human resources,” said Gabai. “If there are additional human resources, they won’t come from Tel Aviv but from the periphery.”

Approximately one-third of the Innovation Authority’s annual grants budget – some NIS 500 million – was allocated in recent years to research and development activity in the periphery, including to strengthen the hi-tech ecosystem in large cities such as Beersheba, Haifa and Jerusalem.

During 2018, the Innovation Authority invested in 920 companies and funded approximately 1500 innovative projects worth NIS 1.7 billion ($463 million), in life sciences, advanced manufacturing and periphery areas.

The Authority’s five-year strategic program, approved last year, aims to ensure sustainable technological leadership in the hi-tech industry, to increase the impact of hi-tech companies, to support innovation strengthening competitiveness and productivity in the business sector, and to promote technological innovation with social and economic returns.