With a fragile 72-hour ceasefire set to end tonight, the clock is ticking on a deal to end hostilities in the war in Gaza that has dragged on for a month and claimed the lives of nearly 2,000 Palestinians and 67 Israeli soldiers.
Despite the conflict, business operations of 40-plus Israeli firms with Georgia ties have gone ahead largely without major interruptions, especially those in the north, like Nazareth-based Alpha Omega.
“We were shipping through the whole period. All of our shipments from Israel here got here fine. Our freight forwarders had no issue, and customs let our shipments through without any problems,” said Anthony Decarolis, CEO of Alpha Omega USA, the American branch of the Israeli medical-device manufacturer.
While everyone is cautious and concerned, there’s also a hard-won sense of perseverance even during intermittent conflicts that Israelis have endured over the years, including the previous war in Gaza in 2012 and one with Hezbollah in Lebanon in 2006.
“They push through them, although no one likes it,” Mr. Decarolis said.
In the far south and even up to the high-tech and tourism center of Tel Aviv, residents have had to be ready to take shelter within seconds of hearing warning sirens.
Asked what that’s been like, venture capitalist Jon Medved told CNBC that it amounts to a slight inconvenience for a resilient people that has spent most of its history under duress.
“As Jewish people, we’ve lived through risk all of our lives, and the idea of spending of couple of minutes – usually it’s in a stairwell or a safe area – maybe once or twice a day? Big deal.” said Mr. Medved, founder of an online crowd-funding platform for startups called OurCrowd. “It has sort of become our water-cooler moment.”
Mr. Medved said that tourism and retail have been the hardest hit sectors, which could trim gross domestic product growth estimates slightly. But he emphasized that Israel’s high-tech sector is resilient, coming off a quarter in which startups raised more than $920 million, a near record. Over the past 10 years, Israel has averaged 4.5 percent growth, and the stock market has tended, ironically, to perform better during conflicts.
Shai Robkin, president of the Atlanta-based America Israel Business Connector, or conexx, said many of the Israeli companies with operations in Georgia are high-tech firms, who by the nature of their jobs know how to come up with “workarounds” when the unexpected arises.
Dealing with partners in Israel has become a challenge in some ways. Some of their younger workers have been called in for military reserve service, and phone calls are frequently interrupted by sirens. Mr. Robkin heard of one company that started holding conference calls with U.S. partners in their shelter room to avoid frequent interruptions. High-tech firms, unlike factories, can keep working no matter the location.
“People have now learned how to set up their systems so that they move into their bomb shelters and they just continue working,” Mr. Robkin said, noting that all apartments built in Israel are now required to incorporate at least one room for rocket shelter. “The amazing thing about Israel is that through it all life goes on, and I think to some extent that has been the secret of Israel’s economic success.”
One of the biggest hits, though, was the two-day closure of the Ben Gurion Airport in Tel Aviv in July, which Mr. Robkin said sent “shockwaves through the system.”
Mr. Medved called the move “unfair.” More than real danger, the American-born venture capitalist said, it reflected the U.S. government’s jitters in the wake of the downing of Malaysian Airlines Flight 17 over war-torn Ukraine earlier in the month.
Mr. Robkin, however, noted that part of the difference between this confliict and previous ones was that Hamas had acquired rockets that could reach Jerusalem and Tel Aviv. Israel’s Iron Dome rocket defense system, which selectively shoots down rockets it deems headed for populated areas, has a very high success rate, but the Federal Aviation Administration issued warnings based on intelligence it had received from the U.S. government.
In response Atlanta-based Delta Air Lines Inc. temporarily diverted flights away from Tel Aviv, citing the warning on Tuesday, July 22. Delta’s flights restarted flights from New York two days later, but that wasn’t before some Israelis living in Atlanta were grounded by the Ben Gurion closure.
Itay Parness, general manager of U.S. operations for Israel-based outdoor solar lamp manufacturer Gama Sonic, received an inadvertent three-day extension on his family vacation to his hometown of Rishon Lezion, which is just south of Tel Aviv.
Daily life wasn’t all that different, he said, but many people were hesitant to go outside with small children, mainly because of the inconvenience of having to find shelter every time a rocket was fired. While hoping for a swift end to the conflict, people didn’t seem to feel an inordinate sense of danger.
“You really want it over, but you don’t feel like your life is on the line,” he said.
The conflict is contained within the Gaza Strip, with Israeli forces engaged in a ground offensive they say is aimed at taking out a network of Hamas tunnels used as a staging grounds for rocket attacks and as a conduit for smuggled weapons and contraband.
News reports saw the prospect of renewed war likely, as talks brokered by Egypt showed little promise of resolving the conflict.
Even with this setback, Israel is still hosting dignitaries from the U.S. and other countries eager to win investment from the small economy that many say “punches above its weight” in terms of technological innovation and global influence.
New York Gov. Andrew Cuomo landed in Israel on a “solidarity” trip this week, joining a parade of American governors who have visited the country in recent years.
The conflict broke out not too long after Georgia Gov. Nathan Deal returned from Israel, announcing a $12 million manufacturing investment near Savannah and the prospect of a payments firm setting up a new office near Atlanta.
In an interview earlier this year with Global Atlanta, Mr. Medved said governors should use their “bully pulpit” to ensure that the outsize impact of Israel on their states’ economies don’t go under the radar anymore.
Conexx, which participated in the Georgia governor’s June mission, is looking to do another trip in December, but Mr. Robkin admitted that recruitment might be more difficult given the fact that Israel is in the news every day for reasons other than its economic prowess.
“Obviously there are people that don’t want to commit to making a trip to Israel under these circumstances,” he said.
Until there is a resolution, he said, Israelis will “keep on keeping on,” staying prepared to deal with what comes.
“Everybody has a Plan B all the time,” he said.
Read more from Global Atlanta’s earlier interview with Mr. Medved on Israel’s FDI potential for Georgia here.
To connect with the America Israel Business Connector, or conexx, visit www.conexx.org.
