Israel has decided to reduce grants for industrial investment. During the next two years, the government will cap government grants at 30 percent of the total investment. Now, the government issues grants of up to 38 percent of the total investment.
The move follows a push by Finance Minister Avraham Shochat to reduce government grants for development projects in northern and central Israel.
Trade Minister Michael Harish had strongly opposed the idea, saying that any reduction would result in a drop in foreign and local investment.
Two weeks ago, the German automobile-giant Volkswagen threatened to pull out of a project to build a joint magnesium plant with the Dead Sea Works if the government scaled back its investment. As a result, no cuts were made.
Prime Minister Shimon Peres had suggested that the grants be reduced to 30 percent over two years, instead of one year, as initially recommended by the finance minister.
JTA has documented Jewish history in real-time for over a century. Keep our journalism strong by joining us in supporting independent, award-winning reporting.
The Archive of the Jewish Telegraphic Agency includes articles published from 1923 to 2008. Archive stories reflect the journalistic standards and practices of the time they were published.
