“There is huge potential for exchange, joint development and convergence of interest”

Grisha Alroi-Arloser, CEO of the German-Israeli Chamber of Industry and Commerce (AHK Israel), looks back on how Israel weathered the corona pandemic and considers what the future holds for the long-established international partnership between his nation and Germany.

January 2023

Israel recovered from the pandemic shock more quickly than other countries, mainly thanks to its well-organized vaccine campaign. What impact did that have on the economy?

Grisha Alroi-Arloser: Israel did get through the first year of the pandemic decently but at the cost of 26 percent unemployment, lengthy lockdowns and grave downturns in the tourism, restaurant, event and retail sectors. But because the high-tech sector was able to adapt to the new world of work extremely quickly, GDP as a whole only declined 2.2 percent. In 2021, Israel began the first vaccine program worldwide and achieved 8.1 percent growth, the highest rate in the OECD. Unemployment fell back down below 4 percent, and exports set a new record of USD 140 billion, creating a trade surplus in the tens of billions.

How do Israelis view Germany as a business location? How does your cooperation with Germany Trade & Invest help when you talk to Israeli companies about Germany?

Germany is Israel’s most important business partner in Europe and is seen by the public as a reliable friend. More and more Israeli tech companies are looking to Germany as a target market for strategic partnerships or as a gateway to the EU. GTAI advises our companies comprehensively, answering questions about employment, transport connections, the respective ecosystem, and funding opportunities. It also closely accompanies the process.

Grisha Alroi-Arloser, CEO of the German-Israeli Chamber of Industry and Commerce (AHK Israel) © private

What kinds of Israeli companies are attracted to Germany? What industry expertise from GTAI is particularly helpful?

With its many languages and cultures, the European continent is naturally a difficult market to crack. Israeli start-ups in the areas of cybersecurity, digital networking of industry, smart cities, mobility, e-health, and fintech and insurtech have a growing interest in German partners – not just the corporate giants but also increasingly SMEs. GTAI’s expertise is of great help to us, since we are of course never as deeply involved in the local industries as the customers expect. The division of labor between AHK and GTAI therefore makes a lot of sense.

Which sectors are ripe for collaboration?

Israel’s many companies offering data- and cybersecurity solutions have a vested interest in finding partners, investors and customers among manufacturers, governmental institutions, banks, insurance companies and critical infrastructure in Europe. The e-health and mobility sectors are also keenly interested in Germany because of its location, the size of the market and the high level of technology there, combined with the country’s need to close the digital gap.

The new German government has prioritized climate action and digitalization. How has that been received in Israel?

The message has gotten through, and the Israeli government has put the same goals on its agenda. Rapprochement with our Arab neighbors has also opened up the path toward contributing to global solutions. The newly ratified German-Israeli Energy Partnership is a clear sign. German delegations from politics and business are coming to Israel to learn about the role of digitalization here in public administration, production processes and business models. There is huge potential for exchange and joint development and a convergence of interests.