TEFEN, Israel — Few would consider this town deep in northern Galilee the ideal location for a utopian vision.
The rocky Lebanese border lies clearly within eyesight. Encircled within the horizon are a handful of villages whose diversity embodies the troubled ethnic history of this region: a Jewish village here, there a Druze, there a settlement of Arabs.
Yet this temperamental region is the kind of place that breeds idealists, and therefore it is not surprising that Stef Wertheimer chose it 16 years ago as the site of his first industrial park. Not your ordinary industrial park: On a groomed hilltop are not only rows of small-scale manufacturing facilities but an experimental school for employees' children, a sculpture garden and two museums. Nearby lies a residential planned community, complete with its own cultural and sports facilities.
Wertheimer, one of Israel's most successful self-made industrialists, decreed that rents would be cheap, the better to help incubate the tenants' businesses. In return, however, the tenants would have to meet his rigorous standards--clean industries, devoted to making goods for export.
From his windowed office atop the headquarters of Iscar, the international machine tool company he founded nearly a half-century ago as a makeshift workshop in his family's kitchen, Wertheimer gazes down upon what he calls his "capitalist kibbutz" and outlines an even more farsighted vision. He sees a network of industrial parks straddling the borders between Israel and its Arab neighbors, bricks-and-mortar incarnations of the dream of regional peace.
"Eventually there will be a factory on the Israeli side and a factory on the Arab side," he says, "and a coffee shop, instead of barbed wire, between them."
The vision of cross-border economic cooperation in the Middle East is as old as the quest for peace itself, and just as elusive: Of the five international industrial parks Wertheimer proposes, for instance, only one, serving Gaza, has received even pro forma approval from the two entities involved, Israel and the Palestinian Authority.
Internal trade even among the four Arab countries surrounding Israel is minuscule, amounting to less than 6% of all regional exports, thanks to multiple tariff barriers. Historically, Israel's economy has been scarcely strong enough to support its own people, let alone export capital, ideas and commercial opportunity to its neighbors.
Now, however, that is changing. Thanks to a high-tech boom that has made it a world-class creator of companies and a magnet for venture capital from all over the world, Israel is joining the ranks of global economic powers. The country is once again considering whether its relative prosperity in the region can be a tool for peace--at a time when peace seems more than ever a precondition for economic growth.
"Whether your company will grow or not depends on your relations with [Silicon Valley]," says Uri Savir, a Knesset member who was Israel's chief negotiator at the Israeli-Palestinian peace talks in Oslo. "Whether it exists or not depends on Gaza. Without peace this latest revolution will not sustain itself."
Most Israeli entrepreneurs are well aware that the flow of foreign investment capital into their country began in earnest only in 1993--after the Oslo accords signaled a new regional commitment to peace.
Israel's prosperity may also act as an obstacle to peace; the economic disparity between it and its neighbors remains a source of friction and an impediment to better relations.
"In the end the [Mideast] conflict is economic," Wertheimer says. "The difference between us and our neighbors is too much. Peace will come the moment all those countries make $6,000 per capita."
Even after the inconclusive outcome of the recent Israeli-Palestinian summit in Washington, most Israeli high-tech executives believe that the peace process, as one puts it, "is irreversible."
The moment of economic equality is a long way off, however. The per-capita gross domestic product of Egypt, Jordan and Syria is between $1,100 and $1,400, according to Economic Models Ltd., a Tel Aviv consulting firm, while Israel's is $16,100. The gulf will widen dramatically if Israeli economic growth accelerates, as is expected, over the next few years.
This phenomenon reflects inequalities within Israel itself, where the burst of wealth among entrepreneurs and the engineers they employ has only begun to trickle down into the economy at large. Israeli businessmen and social commentators are already expressing concern at the widening of Israel's digital divide--the gap between the wealth and opportunity of those plugged into the technology economy and those left behind.
