Bethel Finances: Boycott leaders target IEC

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The cottage cheese boycott leaders announced last night that they will launch a consumer battle against Israel Electric Corporation (IEC) (TASE: ELEC.B22) unless it cancels the pending electricity rate hike. They are also demanding immediate streamlining measures and reform in the electricity market.

"IEC operates on automatic pilot, resulting in electricity rate to the captive consumer," said cottage cheese boycott leader Itzik Alrov. "For an entire summer, the public was constantly admonished to save electricity, and it answered the call, saving IEC 400 million. Now the company is complaining about low cash flow and is again demanding a rate hike.

"The public is fed up with the cynical exploitation and contempt by this bloated, extortionist, and blockheaded monopoly that instead of streamlining, continues to pay inflated salaries at the public's expense. How dare a government company that overpays employees NIS 400 million demand more money from the public, instead of cleaning house?"

Alrov added, "Just as the Israeli government does not want to breach the annual budget framework, the Israeli citizens also do not want to see their monthly budgets breached time after time. Take responsibility and lead real reform at IEC and stop the partying at the taxpayers' expense.

"IEC harms the public, and the public will respond by stopping the company's cash flow. We call on the public to again take their consumer power into their hands and protest against the price hike. On November 11, we will begin disrupting the payment of electricity bills by delaying payment, and other measures.

"We also call on Israel's citizens to go out on to the street on Saturday night and participate in the demonstrations for social justice in the country."

Bethel Finances:Netanyahu intervenes in contract workers dispute

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Sources inform ''Globes'' that, for the first time, Prime Minister Benjamin Netanyahu intervened in the contract workers dispute, meeting with Minister of Finance Yuval Steinitz, Histadrut chairman Ofer Eini, and Economic Organizations Liaison Committee chairman Shraga Brosh at the Prime Minister's Office last night. Netanyahu instructed Ministry of Finance officials to speed up the talks with the Histadrut (General Federation of Labor in Israel) to prevent industrial action by the Histadrut, which announced a labor dispute on the issue two week ago.

Netanyahu's intervention seems to have had an affect. Ministry of Finance Budget Director Gal Hershkowitz and Director of Wages Ilan Levin met Eini this morning and then Histadrut Trade Unions Division chairman Avi Nissenkorn. Earlier this week, Eini said that he would not launch a strike on the issue at this time, while warning that he would not hesitate to "go all the way" if necessary if the negotiations deadlocked.

The Histadrut is demanding the transfer of some contract workers to civil service collective agreements. The Histadrut will reportedly agree that these agreements will provide job security in exchange for flexibility by employers. In other words, workers can be transferred or fired not only after a disciplinary hearing, which are quite rare, but also on the basis of a negative opinion by the employer.

The Histadrut's consent on this point will make it harder for the Ministry of Finance to oppose the direct hiring of contract workers, since the ministry's main argument over the years has been that rigid collective agreements was the reason for the proliferation of contract workers.

Bethel Finances: IEC to slash development plans

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Israel Electric Corporation (IEC) (TASE: ELEC.B22) CEO Eli Glickman has ordered a deep cut in the company's 2012 development plans, including on projects considered critical for the electricity market.

The cuts are liable to affect private power producers and renewable energy ventures, especially in the south, which IEC was supposed to link to the national grid. The cuts will likely astonish the government, which approved a 4.5% electricity rate hike only last week.

Expert sources believe that the planned cut will result in an absurdity, as completed power stations will not be operational because they will not be hooked up to the national grid, even as the country faces a power shortage. "IEC's management opted to confront the government," a top energy official told "Globes". "If the government does not respond, it will end in extensive blackouts that will cause rioting."

The planned cut in the development budget is part of wider cutbacks that Glickman is planning in IEC's 2012 budget. The cutback has angered IEC division managers; at one embarrassing meeting, VP Customers Asher Dahan was evicted after yelling at Glickman.

Earlier this year, IEC's board of directors approved a NIS 4.5 billion investment in power stations and the national grid, and banned management from raising capital to finance additional investments. The board approved investing just NIS 700 million to develop the grid, half the amount that expert sources estimate is needed.

The projects most vulnerable to the budget cuts are the solar energy ventures planned for the Negev. These projects, including Ashelim, and power plants at Zeelim and Timna, will generate 1,000-2,000 megawatts of electricity.

IEC's only power lines in the region are obsolete, and cannot handle the electricity that these projects will produce. Other vulnerable projects include larger power stations and the pumped storage power stations planned at Gilboa and Kochav Hayarden in the lower Galilee.

IEC recently notified scores of pensioned senior managers that it was revoking the extra pay grades they were awarded at their retirement. These benefits added tens of thousands of shekels to the pensions of managers who retired between 1996 and 2006. In 1996, the government banned the practice of granting managers higher pay grades upon their retirement, but IEC evaded the order for a decade by granting a so-called "retirement grade". When the trick was discovered in 2006, the managers were not required to repay the illegal benefit.

Bethel Finances: Netanyahu to seek cabinet nod for halt to tax cuts

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On Sunday, Prime Minister Benjamin Netanyahu will try to obtain cabinet approval for the Trajtenberg committee's tax recommendations. This is the most report's most "revolutionary" chapter as far as Netanyahu is concerned, as it includes measures that contradict his economic principles, such as ending the reductions in income and company tax rates.

"We are not opposed to continuing the tax cuts. It is simply that Israel cannot, socially, bear them," Yoram Gabbai, the brain behind the committee's tax recommendations, told "Globes". Gabbai, a former income tax commissioner, said, "I would be happy to abolish the tax break for companies in central Israel (the Law for the Encouragement of Capital Investments - A.F.), but I didn’t vote against, because in principle, the committee should not cause shocks to the business sector. It's enough that we increased employers' National Insurance contributions (from 5.9% to 7.5%) and the company tax."

The cabinet will also vote on a recommendation to raise the top marginal tax rate on people earning more than NIS 40,231 a month from 45% to 48%. The committee also recommends lowering the cap on National Insurance levies to five times the average national salary (about NIS 40,000).

An analysis by "Globes" found that this is a problematic proposal, because the beneficiaries will be people earning NIS 40,000-134,000 a month. The measure is supposed to end the practice of "wallet companies" - fictitious companies set up by high salary earners to evade high taxes.

The cabinet will vote on the recommendation to award two tax credits to fathers for each child under the age of 3.

The most radical measure that the cabinet will try to promote, and which has infuriated manufacturers, is the abolishing of all customs duties within two years. For the first time, Gabbai disclosed how the recommendation came about, saying, "There were two positions: the more radical and more efficient one for competition in tradable goods is only to open up to competition. All the rest is chasing our tails. My position was simple: zero custom duties, including duty on cars, and the abolition of all purchase taxes. The tax code should vanish."

The cabinet will discuss raising the capital gains tax from 15% to 20%, and to 25% for parties at interest, as well as a 2% surtax on people making more than NIS 1 million from labor and capital gains.

Trajtenberg committee tax recommendations

• Raise the marginal tax rate on monthly income of over NIS 40,000 to 48%: will generate NIS 700 million a year.
• Raise company tax from 24% to 25%: will generate NIS 1.4 billion a year.
• Raise capital gains tax to 25%, and to 30% for controlling shareholders: will raise NIS 1.3 billion a year.
• Cap the National Insurance levy and health tax to five times the average national salary: will cost NIS 800 million in lost revenue in 2012.
• A 2% surtax on people earning more than NIS 1 million a year: will generate NIS 400 million a year.
• Two tax credit points to fathers with children under the age of 3: will increase take-home pay by NIS 420, and cost NIS 1 billion in lost revenues.
• Reduce the excise on gasoline by NIS 0.40 per liter and on diesel by NIS 0.20 per liter: NIS 2.5 billion in lost tax revenues a year. Gradual reduction of purchase taxes and customs duties: NIS 1.5 billion in lost tax revenues a year.

Bethel Finances: Treasury, Industry ministries compromise on import duties

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According to an agreement that was reached last night between the Ministry of Finance and the Ministry of Industry, Trade and Labor, import duties on products will be gradually removed by 2017. The program, however, will not be implemented in the near future.

In 2012 Israel will remove import duties on 20% of products with no local production. Between 2013 and 2017 import duties on products will be lifted gradually, subject to the signing of trade agreements with the countries of origin: South Korea, China, and India.

Minister of Industry Shalom Simhon has approved the agreement over the lowering of import duties. He said that a proposal was being prepared to ensure increased competition and the importation of competing products, as well as making sure that the industry can handle the imports.

Simhon also referred to government funding budget cuts in R&D, saying, "Scientific research budgets are being seriously cut, and this is jeopardizing Israel's technological advantage at a time when countries around the world are adopting the Israeli model of investing government money in R&D."

"By not approving larger budgets for R&D today, we are in essence giving up on Israel's future in everything connected to remaining the world technology leader," Simhon said. "We must look forward in this area, just as we are in other fields, such as in higher education, or agricultural research. If we don’t take control of the situation, we will lose an important Israeli asset. I am warning everyone so that we don't wake up when it is too late."

Bethel Finances: Israeli innovator joins Cornell in tech campus bid

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Strengthening its bid to build a tech campus on Roosevelt Island, Cornell University announced Tuesday that it has teamed up with the Technion-Israel Institute of Technology, a world powerhouse in turning scientific research into start-up companies.

The proposed Technion-Cornell Innovation Institute, a 50-50 collaboration between the schools, would create a graduate program focused on commercialization in areas where the city has a competitive advantage, such as mobile and social technology, health care, the built environment and finance.

The schools would start a new full-scale campus beginning in 2012, either in leased space or existing Cornell facilities in the city. The Roosevelt Island campus would eventually grow to more than 2 million square feet, accommodating some 2,000 graduate students and 250 faculty members.

“I believe in this case, one plus one equals more than two,” said Technion President Peretz Lavie. “We can educate graduate students in engineering in such as way that they will revolutionize the high-tech industry in New York like we did in Israel over the last two decades.”

Students would be required to take courses that prepare them to be entrepreneurs and early-stage investors, and interdisciplinary hubs would provide both technical knowhow and expertise in the city's key industries. At first, they would receive Cornell degrees, but once Technion obtained proper state approvals, students could pursue dual degrees.

Both schools would participate in the design of the campus, but Cornell would own it and provide all the capital dollars for an endeavor that is expected cost well in excess of $1 billion.

“We were looking for a partner who would bring complementary strengths,” said Cornell President David Skorton. “Technion is not only a fine academic institution, but they are superbly qualified and experienced in terms of turning scientific work into tangible economic benefits.”

Cornell is competing with Stanford University for land on Roosevelt Island in a race that Mayor Michael Bloomberg hopes will help the city usurp Silicon Valley as a world leader in high-tech innovation. Stanford helped to seed the tech hub surrounding its Palo Alto campus, but now Cornell has on its side the institution that has created the highest concentration of start-up companies anywhere outside of the Valley.

Technion graduates head 59 of 121 Israeli companies on the NASDAQ, with a combined market value of over $28 billion. Some 75% of Israeli engineers are Technion graduates, as are 70% of the country's start-up founders. Its campus, in Haifa, is comprised of 19 schools and 12,000 students and is surrounded by some of the world's biggest names in technology. Intel, Qualcomm, Microsoft, IBM, Applied Materials, Yahoo and Google all have offices within minutes of the Technion campus.

“I don't think it would be hyperbolic to describe an economic miracle in Israel based on high tech,” Mr. Skorton said. “And Technion has been a major force in Israel becoming home to such a great concentration of tech companies.”

Bethel Finances: Dankner open to offers for everything

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Everything is up for sale at IDB Holding Corp. Ltd. (TASE:IDBH), controlled by chairman Nochi Dankner. Fundtech Ltd. (Nasdaq: FNDT; TASE: FNDT) was sold a month ago, Shufersal Ltd. (TASE:SAE) was sold last week, the sale of Makhteshim Agan Industries Ltd. was closed yesterday, and negotiations for the sale of Clal Insurance Enterprises Holdings Ltd. (TASE: CLIS) are temporarily in abeyance. Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) might also be sold. The picture is clear: for the right price, Dankner is prepared to make good on his investments.

This should not come as a surprise, since as a holding company, IDB buys and sells assets. But when the issue is Nochi Dankner's IDB, the strategy in the past was different - buy low and sell high. But while Fundrech and Makhteshim were sold at a good price, and Shufersal at a great price, this is without question not a peak time in the markets that would justify a sale.

This raises the question why Dankner is selling core businesses of his company. First, he was burned during the summer by high leverage. He personally learned that one mistake - in his case, the huge and highly leveraged investment in Credit Suisse Group AG (NYSE: CS; SWX: CSGN; XETRA: CSGZ) shares - can jeopardize his entire conglomerate.

Dankner realized that IDB was over-leveraged, and that it was vital to reduce its debt and improve its liquidity in order to lower investor pressure, reflected in the soaring yields on the bonds of IDB's subsidiaries.

Although IDB will only recognize most of the proceeds from the sale of Shufersal in a few years, Dankner sent a loud a clear message to the capital market: the owner of the house is home and he's tackling its problems. The result is seen in the sharp drop in the bond yields of IDB's subsidiaries in the past few days.

The sale of the controlling interest in Makhteshim, for which IDB will make $1 billion, will greatly improve its financial position.

Another reason for the change in IDB's strategy is the social protest that erupted this past summer. Although Dankner is not (yet) a target of extensive consumer boycotts against his businesses, the anti-business mood and antipathy towards the men at the top has definitely influenced him. For a man whose image, especially his social image, is important, Dankner does not want to face the decline of Tnuva Food Industries Ltd. and its former chairwoman, Zehavit Cohen. Dankner is the last man prepared to suffer demonstrations outside his home.

Dankner also knows well that the pending tighter regulations against Israel's tycoons, and the rise in consumer awareness, will make it harder for him to raise prices, improve profit margins, and expand. He already knows that he has reached the limits of growth in the domestic market, and if the opportunity comes knocking, it's best to sell, increase liquidity, and maybe look for opportunities elsewhere. IDB apparently believes that the plunging markets have created a surfeit of opportunities.

Pursue growth abroad

Dankner's old dream was to take IDB abroad and turn into a multinational corporation. For years, he has talked about this strategy, and IDB made several foreign deals in recent years. But Dankner can't get any satisfaction from them.

As for the investment in Credit Suisse, which began as a success story, but since turned into a source of appalling losses, much has already been written. This is also the case for the multibillion dollar investment in the ambitious Plaza casino and hotel in Las Vegas, jointly made with Yitzhak Tshuva, and which is now stuck in the sands. The establishment of a US investment arm through Clal Finance Ltd., Titanium Asset Management Corporation (AIM:TAM), has also resulted in heavy write-offs.

Although Dankner has established many foreign ties over the years, mainly through the Credit Suisse investment, he knows that Israeli businessmen do not necessary add value overseas, and that foreign investment is inherently risky. Nonetheless, he has not given up, and he believes that the globalization of Israeli business will continue; in fact, it must continue, because there is no choice. There is little left to find in Israel.

IDB's globalization is not only reflected in the investment in and acquisition of companies. Dankner plans to move a substantial part of the company's financing abroad. There are a number of varied reasons for this, ranging from the single borrower restrictions on Israeli banks, which the Bank of Israel has tightened recently, to the Hodak committee recommendations for the bond market, which make it harder for IDB to raise capital at the easy terms it was used to in the past.

Why the Chinese stayed in the game

At the height of this summer's market crisis, when the yields of IDB bonds soared to junk bond status, and the share price daily sank lower, the capital market was deeply worried about the pending sale of Makhteshim to ChemChina, as the Chinese are known as unexpected business partners for whom signing a contract is often just the first step in negotiations. At the same time, there were real changes in share prices, and the price of six months ago is largely irrelevant to the current price.

Moreover, ChemChina undoubtedly saw IDB's liquidity problems caused by its losses on Credit Suisse. It knew how much IDB was depending on the sale of Makhteshim to improve its liquidity and they could have exploited this to get a better price. Had that happened, there was a good chance that Dankner would have agreed to a discount.

But ChemChina did not withdraw and the closed the sale at the terms agreed: the acquisition of Makhteshim at a company value of $2.4 billion - the largest acquisition by a Chinese government company outside the country in the past year.

The Chinese government, with more than $2 trillion in cash reserves, want to acquire foreign companies all over the world. They know that the world is viewing them with suspicion, because of China's different world view, and they know that the acquisition of Makhteshim was a good opportunity to show that they are reasonable partners who do not demand the reopening of contracts and discounts, even when they can do so.

Bethel Finances: "Demand for Israeli bonds is much higher than supply"

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In a world awash in growing sovereign debt, to the point of loss of control in some European countries, Israel's relative economic standing is strengthening. It is no wonder that Ministry of Finance representative in New York Sigi Sayag and deputy accountant general finance and banking Eran Heimar are optimistic about Israel's international economic standing and its ability to raise external debt.

Sayag is responsible for the management of Israel's external debt. In an interview with "Globes", Sayag and Heimar reveal the Ministry of Finance's plans to raise additional foreign currency debt in 2012. They explain why, despite market shocks and the deteriorating geopolitical environment in the Middle East, the ministry is very confident and is not even worried that the US might reduce its aid to Israel.

"Globes": Israel's geopolitical condition has worsened as a result of the changes in the Middle East. How does this affect Israel's ability to raise capital?

"There are geopolitical effects, but investors can distinguish between them. Evidence is the recent upgrade of Israel's credit rating. Israel has good macroeconomic figures, and in a world of shaky financial systems, unpleasant neighbors are not as scary as they once were."

Is there a risk of a politically motivated investor boycott against Israel, for example by pro-Palestinian European countries such as Norway or Belgium?

"Today, the geopolitical situation does not affect the credit situation. What will happen tomorrow, we don’t know. But if Norway doesn’t want to invest in Israel, there will be other countries: China, Thailand, Singapore, Russia. There's enough money in the world that is seeking Israeli diversity for its investment portfolio. In our last offering in Europe, in March 2010, demand totaled €13 billion, and we had to cap the investment at €1.5 billion. There's a lot more demand for Israeli bonds than we can offer."

If our condition is so good, why does Israel still need State of Israel Bonds?

"Israel Bonds is a strategic asset for Israel. Rating agencies even cite its existence. It's true that Israel Bonds hasn’t been needed in recent years, it seems expensive, but it will help when needed in hard times. Other countries, such as India and Greece, come to ask us for advice on how to mobilize their diasporas for the good of the country. Israel Bonds is a tool for expressing support for Israel in hard times, and the capital raised is influenced by what is happening in Israel.

"By the way, it's not just Jews who buy. There are American groups who see this as a way of sending messages to the Jewish community and the administration."

The US is heading for a recession, unemployment is high, and calls for belt tightening are heard from every side. At the same time, Israel receives $3 billion a year in military aid. Is there a risk to the continuation of US aid in its current format, and should we expect demands to cut it?

"There is such a scenario, but it's unlikely, especially not when the Middle East is in upheaval. That's why it's unlikely that the aid will be cut. There's an alliance between the countries, and both sides have an interest in maintaining it. For example, this year, defense aid was higher than planned, and supplements were given for Iron Dome."

Unsocial

Does the Ministry of Finance plan to raise foreign currency debt soon?

"We plan to raise foreign currency debt next year. We don’t really need the money; the goal is to keep financing channels open. Like any CFO of a business, we prefer to diversify our sources of financing and to maintain a constant market presence. It's necessary to raise capital from investors when you don’t need it, so that they'll be there when you do."

The present timing is a bit problematic, with the social protest threatening to breach the budget framework and increase the deficit.

"To the best of our knowledge, we're not going to breach the budget framework, but we'll change priorities within it. Israel has shown a consistent reduction in the deficit over time, and the markets now love Israeli credit. In contrast to other countries, Israel's banks are not in trouble, and the country's rating is rising, not falling."

What will happen if the protest nonetheless results in a breach of the budget?

"Israel raises NIS 80-100 billion a year. A lack of confidence and anxiety is translated into higher interest rates, and it's unsocial to pay too high interest. If we bequeath our problems to our children, that's unsocial. If the protest causes us to increase the deficit, the public will pay higher interest over time. If Israel raises debt with a duration of eight years, and if as a consequence of breaching fiscal limits, we have to pay another 0.5% interest, we'll end up spending hundreds of millions of shekels more each year."

Bethel Finances: Corporate Secretary

Looking for a Corporate Secretary for different services including establishment of worldwide companies, branches, representative offices or offshore companies, provision of registered office address, corporate secretarial compliance services, and advising on appropriate group structure etc.;

Accounting services including initial set up of accounting system, book keeping services, compilation of management accounts and financial information analysis;

Payment processing services including processing payment of approved invoices and employee expense claims and providing authorised bank signatory.

Handle a full range of company secretarial duties for the clients;

Assist in the formation of worldwide companies and offshore companies or the acquisition of shelf overseas company as well as registration of branch or representative office for overseas companies

Working with external and internal lawyers

Help to advise on corporate governance and compliance and monitor relevant statutory and regulatory matters

Full time: Mon-Thu 9-18:30, Fri 9- 1 hour before Shabat, overtime if necessary

Please include salary expectations - CVs without them will be disregarded

Hebrew mother tongue- English fluent- Additional language welcome

An academic degree is required

Microsoft Word-Excel

Previous experience in finance and tax advisory, law firm or CPA firm a must

Must be reliable, honest, assertive and able to work under pressure

Location Tel-Aviv Israel

Please submit your job application to career@bethelfinance.com

Bethel Finances: ChemChina completes Makhteshim Agan buy

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The sale of agrochemicals manufacturer Makhteshim Agan Industries Ltd. by Nochi Dankner-controlled IDB Holding Corp. Ltd. (TASE:IDBH) to China National Chemical Corporation (ChemChina) subsidiary China National Agrochemical Corporation was completed today. The TASE suspended trading in Makhteshim's share today.

As of today, Makhteshim becomes a private company, 60% of which is owned by ChemChina, and 40% by Koor. IDB subsidiary Koor Industries Ltd. (TASE:KOR) received $1.1 billion, including $168 million for 7% of Makhteshim and $960 million in a non-recourse loan secured by its remaining 40% stake in the company. Koor will report a net profit of NIS 582-674 million on the sale in its financial report for the fourth quarter and its shareholders' equity will increase by NIS 655-747 million.

Makhteshim's existing management team will continue to lead the company, and its headquarters will remain in Israel. The company intends to continue operating all of its existing global manufacturing facilities. It will also seek to capitalize on its strong base in China to further expand its global infrastructure and its ability to offer the industry’s leading portfolio of crop protection solutions.

With the closing of the sale, all Makhteshim employees' options will be cancelled, as a condition of the deal. The company will buy all the options held by 130 employees and managers, including ten top executives. The options will be purchased at their fair value for a total of NIS 73 million, including NIS 16 million that will be paid to Makhteshim president and CEO Erez Vigodman.

Makhteshim noted that its merger with ChemChina is the largest transaction ever concluded between a Chinese and an Israeli company, and was a major milestone in its 66-year history.

Makhteshim chairman Ami Erel said, "I want to thank the board of directors for their contribution to the complicated procedures required to obtain approval of the merger, and members of management, headed by Erez Vigodman, for their leadership, management, and hard work during this period.

Koor's share price rose 4.6% in morning trading to NIS 44.48, giving a market cap of NIS 2 billion, and the share price of its direct parent company, Discount Investment Corporation (TASE: DISI), rose 4.4% to NIS 37.60, giving a market cap of NIS 3.1 billion.

Bethel Finances: 79% of Israelis support Shalit deal

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24 hours before the prisoner swap for Gilad Shalit is due to take place, the majority of Israelis support it, according to a survey by Hebrew daily "Yediot Ahronot" and Mina Zemach. 79% of the public supports the deal and 14% of the public opposes it. However, 53% of the respondents said that the Israeli government compromised its principles in making the deal.

In response to the question, "Do you support the deal to free Gilad Shalit in exchange for 1,027 terrorists?", 79% of respondents said, "Yes", and 14% said, "No". 74% of men support the deal and 19% oppose it, while 86% of women support the deal and 5% oppose it.

Prime Minister Benjamin Netanyahu said that he made a statesmanlike decision, but 49% of the public think that he capitulated to public opinion, which motivated his conduct. 53% of Israelis think that the government compromised its principles more in making the deal, compared with 20% of Israelis who think that Hamas compromised its basic principles. 20% think that both sides compromised equally.

65% of the public thinks that it was not necessary to wait five years to free Shalit and that a deal with Hamas under similar terms could have been reached earlier. 20% of the public thinks that only now have conditions come about making the current deal possible.

The public is fully aware of the security consequences of the prisoner release, but it is divided over how far it has been harmed. 50% of respondents fear that security will worsen because of the deal, and 48% believe that the security forces can handle the threat and that the public's security will not be affected.

Bethel Finances: Israeli media agrees to respect Shalit's privacy

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Israel's main media sources yesterday signed an agreement written by the IDF spokesman promising not to follow Gilad Shalit and his family or publish new pictures or video clips for ten days. The Israel Journalists Association and Shalit's family welcomed the agreement. The agreement does not apply to the foreign media in Israel.

The agreement states, "This agreement does not dim, even by an iota, the eternal flame of the public's right to know. Its sole purpose is to achieve a proper balance between this paramount right and the right of Sergeant Major Gilad Shalit and his family to their privacy. This privacy is essential, partly for the family's rehabilitation, and the recovery and health of Gilad from his long period in captivity."

The parties to the agreement are Hebrew dailies "Yediot Ahronot", "Haaretz", "Maariv", "Israel Today", and "The Jerusalem Post", weekly "Makor Rishon", the websites of "Haaretz", "Yediot Ahronot's" ynet, and "Ma'ariv's" nrg, “IDF Radio" (Galei Zahal), and TV stations Channel 2, Channel 10, and Russian-language cable station Channel 9.

The Israel Broadcasting Authority did not sign the agreement, because Channel 1 and "Kol Israel" - the Voice of Israel operate according to the authority's code of ethics.

In an appeal to the foreign media, Government Press Office director Oren Helman said, "Pursuant to the commitment of the Israeli media, I would thank you if would refrain from publishing either stills photographs or video footage that infringe on the privacy of Sgt. 1st Class Gilad Shalit for the 10 days following his release, except for those instances in which the approval of the Shalit family has been received. My appeal to you is a request only; of course, you are free to act according to your professional considerations."

Bethel Finances: Meitav sees chance of further interest rate cut

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Last Monday, the Bank of Israel published the protocols of the October interest rate discussion, in which Governor of the Bank of Israel Prof. Stanley Fischer decided to lower the rate by 0.25% to 3.00%, a move that took most analysts by surprise. According to the protocol, most of the Monetary Forum's members recommended leaving the rate unchanged at 3.25%. However, Fischer decided to go forward with the rate lowering.

In its weekly report, Meitav Investment House Ltd. said, "November's interest rate will probably remain unchanged, but with a good chance of another reduction to 2.75%, with the release of new data indicating a slowing down of the economy, and initial drops in real estate prices." Starting next month, the interest rate will be set by a monetary committee, and not by the governor alone.

The trade deficit for September, after seasonal fluctuations are discounted, was $613 million. Meitav estimates that, "The trade deficit will continue over the next few months, although it could become more moderate." Meitav claims that although the global economy is stagnating, and there is concern that a double dip recession could negatively affect exports, the sharp devaluation of the shekel against the dollar over the last few months has been beneficial for exporters. Moreover, Meitav points out that Israeli exports are deepening their exposure to the Far East, a region that has not been hit as hard as Europe or the US."

Bethel Finances: Shekel strengthens against euro

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The shekel is strengthening against the euro, but weakening against the dollar in morning inter-bank trading, as the euro weakens against the dollar. The shekel-dollar exchange rate is up 0.26%, compared with yesterday's representative exchange rate, to NIS 3.644/$, but the shekel-euro exchange rate is down 0.29% to NIS 4.998/€.

Yesterday, the the Bank of Israel set the shekel-dollar representative exchange at NIS 3.635/$, down 0.68% on Friday's rate, and set the shekel-euro representative exchange rate at NIS 5.038/€, down 0.25%.

In international markets, the dollar is strengthening against the euro, as new worries arose about the debt crisis in Europe, but is weakening against the Japanese yen and pound sterling. The dollar is trading at $1.37/€ against the euro, at ¥76.85/$ against the yen, and $1.57/₤, against the pound.

Bethel Finances: LA COOPERATION ECONOMIQUE SE POURSUIT A GRANDE VITESSE ENTRE LA CHINE ET ISRAËL. SOUS LE REGARD DES AMERICAINS UN VERITABLE PRINTEMP

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Plusieurs signes attestent un regain d’intérêt des dirigeants chinois pour le Moyen-Orient et plus particulièrement pour Israël. Se rendant pour la première fois en Israël à la fin août pour y rencontrer les dirigeants de l’État hébreu, le chef d’état-major de l’Armée de Libération du Peuple chinois, le général Chen Bingde qui venait de visiter la Russie et l’Ukraine ne s’est même pas donné la peine de faire étape dans un autre pays de la région, ni en Égypte, ni à Ankara, ni Ramallah ou Téhéran. Une série d’omissions volontaires qui ont été très remarquées, non sans une certaine inquiétude, par Téhéran et ses alliés extrémistes du Hezbollah et du Hamas.

Une visite assez exceptionnelle qui a clairement montré que les dirigeants chinois ne cautionnaient pas les énormes efforts déployés par le bloc arabe et ses alliés visant à totalement isoler et à délégitimer Israël sur la scène internationale.

Cette évolution peut aussi s’expliquer par le fait qu’en tempérant son soutien traditionnel à des pays arabes comme la Syrie et l’Égypte en plein bouleversement et où l’avenir semble plus incertain que jamais, Beijing escompte jouer un rôle plus actif dans les dossiers régionaux et aussi dans le processus de paix israélo-palestinien pourtant à présent dans l’impasse.

Vers un renforcement des liens entre Beijing et Jérusalem ?
Il faut dire que depuis 1992, date à laquelle la Chine et Israël ont établi des relations diplomatiques bilatérales pleines et entières, l’amitié et les contacts entre les deux pays se sont surtout développés aux plans économique et technologique : des centaines de missions d’experts israéliens ont été envoyées en Chine dans des secteurs d’activité aussi variés que les fibres optiques, la téléphonie, l’informatique, l’agriculture en terre aride ou le traitement et la distribution de l’eau dans les régions sèches pour y diffuser le savoir-faire « bleu et blanc » dans tous ces domaines. Une forme de coopération qui, d’après tous les témoignages de sympathie recueillis sur place par les experts israéliens, est fort appréciée en Chine.

Parallèlement, de nombreuses délégations professionnelles ont été échangées depuis quinze ans entre les deux pays, des étudiants chinois venant en formation en Israël, et inversement.

Autant de « liens de terrain » qui ont beaucoup rapproché les deux pays, les Chinois – l’un des plus anciens peuples agricoles, sédentaires et… surpeuplés de la planète – se montrant chaque fois étonnés des prouesses et de la sagesse techniques de ces Juifs d’Israël – ce minuscule peuple balloté aux quatre coins du monde par l’Histoire, mais qui a réussi après 2 000 ans d’errance à revenir sur sa terre ancestrale pour y former, en quelques décennies à peine, des experts agricoles « imbattables » dans leur domaine…

La nécessaire compréhension des Américains
Or l’inquiétude et la suspicion de l’Amérique pourtant premier allié d’Israël ont provoqué en l’an 2000 un coup d’arrêt momentané à ces relations entre Jérusalem et Beijing suite à l’affaire de la vente à l’aviation militaire chinoise, par les Industries aéronautiques israéliennes, d’avions américains de type Falcon équipés de procédés « made in Israël ». Un incident qui s’est reproduit en 2004 lorsqu’Israël a vendu à la Chine des drones, aux équipements jugés « trop sensibles » à Washington.

Il n’empêche : à mesure que le rôle déterminant aux plans économique, financier et à terme diplomatique de la Chine grandit de manière exponentielle dans toute l’Asie et à l’échelle planétaire, les relations israélo-chinoises sont appelées à beaucoup se développer lors des prochaines années dans un Proche-Orient de plus en plus déstabilisé où l’État hébreu est sans doute en train d’apparaître, aux yeux de Beijing, comme un îlot de réussite.

Surtout si les États unis, laissant leurs suspicions de côté, comprennent enfin le rôle positif et équilibrant que pourrait désormais jouer, dans cette région en pleine transition, le pays le plus peuplé de la planète qui est aussi la seconde économie mondiale.

Bethel Finances: Foreign currency reserves fall in September

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Israel's foreign currency reserves fell by $1.747 billion in September to $76.331 billion, the Bank of Israel reported.

The decrease was the result of a revaluation that lowered the reserves by $1.81 billion and government transfers abroad totaling $222 million. This was offset by a rise of $285 million from private sector transactions.

Following a foreign currency purchasing program by the Bank of Israel in recent years to weaken the shekel and thus assist Israeli exporters, the country's foreign currency reserves rose from $59.091 billion in December 2009 to a record $78.078 billion in August 2011, before slipping back last month.

Bethel Finances: Dankner sells Shufersal

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Nochi Dankner is selling control of supermarket chain Shufersal Ltd. (TASE:SAE). On Wednesday, Dankner signed a memorandum of understanding whereby IDB Holding Corp. Ltd. (TASE:IDBH) will sell 70% of its stake in Shufersal to British businessman Leo Noe, giving him 32%, and the rest, 13.5%, to its existing partner in the control of Shufersal, Bronfman Fisher Group, owned by Matthew Bronfman and Shulem Fisher, which already owns 18.56%. The deal means the two buyers will have equal stakes.

IDB will sell its stake for NIS 2.419 billion, representing a valuation of NIS 5.26 billion for the company. Shufersal has a market cap of NIS 3.573 billion.

The deal was arrived at after lengthy negotiations. Dankner has been in talks with Bronfman Fisher several times in the past over a sale, but each time withdrew at the last moment.

The Bronfman family will probably have to sell its stake in Israel Discount Bank (TASE: DSCT), since, according to the recommendations of the committee on concentration in the economy, which have yet to be legislated, ownership of a bank and of a non-financial asset of the size of Shufersal will be prohibited.

Commenting on the sale, Dankner said, "Shufersal is not just another deal for me. I love Shufersal, and my heart will always be with it and its workers. However, as an investment company with an obligation to its shareholders, we must remember that we have to distinguish between our love for Shufersal and considerations of economic value. As soon as we received a very good business proposal, this consideration obliged us to overcome all others. We will receive a good price from the buyers, and will also assist them with a loan that will ease the purchase for them."

Shufersal is Israel's largest supermarket chain. In the first half of 2011, it had revenue of NIS 5.81 billion, and a net profit of NIS 140 million.

The sale comes in the shadow of the social protests over the summer, which were partly over food prices. On Tuesday, "Globes revealed that, immediately after the current Jewish holiday season, Shufersal will embark on a streamlining program that will include a salary cut for employees and layoffs at the company's headquarters, because of rising price competition, which will hit profitability.

Bethel Finances: Yuli Ofer bequeaths business to daughter

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Sources inform ''Globes'' that the late Yuli Ofer has left all his shares in Ofer Investments Ltd. to his daughter Leora, leaving his son, Doron, with nothing. Yuli Ofer died on September 14 at 87, and his will was read earlier this week.

Sources believe that Doron will contest the will against his sister.

Yuli Ofer owned 36.7% of Ofer Investments, Leora and Doron each owned 15%, and their cousin Eyal Ofer (son of the late Sammy Ofer who died on June 2), owned 33.3% Following the will, Leora will own 51.7% of the company, giving her control.

The Ofer family owns 25.44% of Mizrahi Tefahot Bank (TASE:MZTF), including a 17.72% stake held by Ofer Investments. Ofer Investments also owns 75% of Melisron Ltd. (TASE: MLSR), which became Israel's largest mall owner earlier this year when it acquired British-Israel Investments Ltd. (TASE: BRTS), thereby surpassing Azrieli Group Ltd. (TASE: AZRG).

Doron sold his 33% stake in Ofer Shipping Ltd. to Sammy Ofer's Ofer Holdings Group a few years ago. Leora got nothing in that deal. Doron is active in real estate, mainly in the UK, which has made him wealthy in his own right.

In August, Supervisor of Banks David Zaken notified Ofer Investments that it must settle the dispute between Yuli and Doron over splitting the company, otherwise it would amend the company's control permit for Mizrahi Tefahot Bank. Zaken gave Ofer Investments until September 15 to submit a report on the bank's's investments-to-sources ratio (its leverage), so that the Banking Supervision Department can examine the ratio with regard to the control permit. Zaken extended the deadline following Yuli Ofer's death.

Doron Ofer opposes the rest of the family, and opposes separating Ofer Investments' holding in Mizrahi Tefahot Bank from Melisron.

Bethel Finances: Bethel Finances: "No-one understands"

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"May you get to know Israel again, may you return home as quickly as possible, let there be only joy. Welcome. From Idan Ginossar, aged 7, from Haifa," said a note left on Friday afternoon in the box for letters to Gilad Shalit on the sidewalk beside the protest tent. On the back of the note, a drawing of a dinosaur, a sweet tribute from a caring child, who came to visit the parents of abducted soldier Gilad Shalit shortly after they left to travel home to Mitzpe Hila.

The protest encampment in Jerusalem, opposite the prime minister's residence, was empty of activists, and a few film crews and reporters still hovered around, wrapped up against the suddenly cool night air of Jerusalem on the eve of the Succot festival. The number 1935, the number of days of captivity, remained emblazoned on two signboards, one where the family would sit, and another on the other side of the road, addressed directly to Prime Minister Benjamin Netanyahu: "Sara and Bibi, I have been held captive alone for 1935 days, and where are you?"

By Friday, all the protest activists and the Shalit family already knew that that sign could be removed. The prime minister was in residence, having closing the deal for Shalit's return in exchange for about 1,000 Palestinian prisoners held in Israel, perhaps the hardest task facing him, the last matter remaining open from the events that led to a war that he did not start.

On a white placard, fixed to Gilad's chair, is written, "Gilad! Just come. We are waiting for you. Too many years, we have gone crazy, we have no life any more. Just come!." On the back of the plastic chair was draped a T-shirt of the "Erim Balayla" ("Sleepless Nights") organization for prisoners and those missing in action, and every camera records the chair that has stood empty for many long months in the tent, waiting for Gilad. The chair was left behind, in the empty tent.

Earlier, Shalit's parents, Noam and Aviva, and his brother Yoel came to collect their things from the tent. They have to withstand several long days, suffering the public discussion of the names of the prisoners who will be released, to wait through petitions to the High Court of Justice against the deal, and to endure the nail-biting processes of the release itself, reportedly due to take place by Tuesday, before the final end of the story of Gilad's abduction.

Noam Shalit was due to talk to "Globes" on Wednesday for an article about him and the protest tent. We had arranged to meet at 12 pm in Jerusalem, when no-one knew that very soon there would be no tent.

But on Tuesday, Noam Shalit called to say that the meeting would not take place. In his polite way, he explained patiently that he was making no plans for the coming days, that he did not want to meet on Saturday at Rosh Hanikra either (where another protest event was planned), and when I asked him whether I could meet Aviva at Rosh Hanikra, he replied, "No. She will be with me the whole time, and I will not be at Rosh Hanikra." This was in a telephone conversation last Tuesday, October 11, in the afternoon, when of course he did not want to reveal anything of what he felt in those fateful moments in his life and in the life of his son.

Yesterday evening, as the Succot festival began, the entire family returned home to Mitzpe Hila, and the whole community waited for them. People prepared placards and got ready for the celebration of the soldier's return home.

"No-one understands. No-one grasps the reality of it. It seems unreal to see the pictures on television," Yoel Shalit told the media yesterday. "We waited an awfully long time, more than five years, and finally it happens," he said, and drove off with his parents to prepare the home for the event that really matters.

Bethel Finances: Eini compares contract workers to slave market

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Histadrut chairman Ofer Eini today declared his promised general labor dispute over the issue of contract workers. In his declaration, Eini compared the use of contract workers with a slave market.

"Something happened in the summer of 2011," said Eini. "The whole citizenry came out onto the street to demand social justice. In my view, there can be no social justice without dealing with the issue of contract workers. For decades, Israel has created dozens, even hundreds of kinds of jobs, but their common denominator is indirect employment. We've created a slave market, exploiting contract workers."

This is the first time that the Histadrut (General Federation of Labor in Israel) is declaring a labor dispute over the use of contract employees but it is merely an excuse by Histadrut chairman Ofer Eini to lay the groundwork for a general strike to protest the Trajtenberg committee recommendations. The Histadrut is demanding that contract workers be employed directly, and to reduce the number of contract workers to the absolute minimum necessary.

Eini continued, "It is sometimes necessary for someone to push the cart in order to achieve social justice. It is necessary to deal with the issue of contract workers who must cease being unseen people. This is not just about money; these workers must also feel that they belong.

"If we succeed in this endeavor, we'll deliver a critical act in Israel. We'll mark out these workers so that they will be seen; they will suddenly become a part of us. Let there be no mistake, this is no easy task. It is a complicated issue that has successfully confused everyone. It occurs at almost every workplace."

In drumming up support, Eini said, "We have children, grandchildren, or relatives who are contract workers. Our goal is for them to be able to lift their heads, to say, 'We are part of the People of Israel'."

Social protest leader Dafni Leef supports Eini's declaration. In a statement, she said, "The hundreds of thousands of unorganized contract workers deserve basic rights and dignity. The Israeli government, a serial ignorer of the public's demands for social justice, is the largest employer of contract workers in the economy. Social justice begins with basic rights owed to every employee - especially government employees who serve all of us, and who are paid with our taxes. This is where the change in Israel's job conditions should begin."

Bethel Finances: Teva receives European approval for Cephalon acquisition

Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) and Cephalon Inc. (Nasdaq: CEPH ) announced today that they received approval from the European Commission to proceed with Teva’s $7 billion acquisition of innovative drugs company Cephalon.

A condition of the approval is that Teva must divest Cephalon's marketing authorization of generic modafinil in France and grant to the purchaser of this marketing authorization certain additional rights with respect to the entire European Economic Area, including a covenant not to sue effective as of October 2012.

Teva received approval for the US authorities for the merger at the beginning of the week. Under that approval, Teva is required to divest two ANDAs for fentanyl citrate lozenges, a generic version of Actiq, and cyclobenzaprine ER capsules, the generic version of Amrix. Teva will also grant non-exclusive U.S. rights to an undisclosed company to market modafinil tablets, the generic version of Provigil, which had annual brand sales in the US of approximately $1.1 billion.

With the European Commission approval, the parties have now obtained all regulatory approvals required to close the transaction and, accordingly, have scheduled a closing date of October 14, 2011.

Teva projects that the deal will be accretive on a non-GAAP basis as soon as it is completed, and on a GAAP basis within four quarters. Teva also expects synergies of $500 million in the third year after completion.

Bethel Finances: 42% of public sector earn less than average national salary

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Ministry of Finance Director of Wages Ilan Levin submitted a report on salary results for 574,808 people employed by the government of Israel and public institutions.

42% of public sector employees earn less than the average national salary. According to the annual public sector salary report published by the Ministry of Finance, the average monthly salary of public sector employees in 2010 was NIS 12,929, a rise of 4.8% from 2009.

The report covers 496,559 employees, 184,544 of whom work in the security sector (IDF, Prison Service and Police) and 98,053 in the field of education. The salary report includes data for 754 public bodies (local authorities, municipal companies, municipal associations, government companies, religious councils and statutory enterprises). The total amount paid in salaries for 312,015 employees was NIS 50,460 in 2010.

There is a striking anomaly in the Israel labor market: 36% of public sector employees receive minimum wage supplements. The average monthly salary of these employees, however, is NIS 10,278, 20% more than the average national salary. This is possible because the Ministry of Finance grants various supplements instead of pay raises. This way, employees receive a net salary that is sometimes higher than the average salary, but at their retirement, their monthly pension will drop drastically. Also, 20% of government employees earn less than minimum wage.

Bethel Finances: New regulations allow cancellation of flight bookings

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As of today, it will be possible to cancel a reservation on round-trips flights booked at a travel agent, rather than by telephone or Internet. Despite objections by airlines and travel agencies, the Consumer Protection and Fair Trade Authority's new regulations came into effect today.

A person can cancel a reservation up to 14 days from the date of purchase or up to 18 business days before the date of departure. It will also be possible to cancel a follow-on flight, provided that it is provided by the same airline handling the flight from Israel.

The new regulations do not allow cancelling related tourist services, such as a hotel at the destination or follow-on flight provided by a different airline. This is because Israeli regulations do not apply to foreign businesses and they cannot be compelled to refund money to Israeli consumers.

The Consumer Protection Law (5741-1981) already allows the cancelation of flight reservations made by phone or online up to 14 days from the date of purchase or up to seven days before the date of departure.

Bethel Finances: IEC to build $1.3b Chinese solar energy project

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Sources inform ''Globes'' that Israel Electric Corporation (IEC) (TASE: ELEC.B22) will build a $1.3 billion project of three photovoltaic solar energy arrays in northern China. IEC's board of directors approved the project, the utility's first investment in China, at its last meeting. As the project's chief contractor, IEC will not invest equity in the project.

The project is also IEC's first investment in a solar energy project, and it is the utility's largest foreign project to date. The Government Companies Authority still has to approve IEC's participation in the project. The Ministry of Finance has blocked IEC's entry into new fields until negotiations on reforming the company are completed.

The 240-megawatt PV solar arrays will be built on private land owned by a Chinese businessman and his Israeli partner, who approached IEC about the project three months ago. IEC will own 50% of the engineering, procurement and construction (EPC) company that will build the project, the Chinese partner will own 25%, as required by Chinese law, and a large foreign contractor of solar arrays will own the remaining 25%. A Chinese manufacturer will supply the PV panels. IEC has no experience in building solar energy projects, and is banned from the business in Israel.

The Chinese project will enable IEC to acquire experience in the field. It will provide a small team who will coordinate between the project's subcontractors.

The project will comprise three 50-MW PV fields and rooftop PV systems installed on the farm's greenhouses to generate an additional 90 MW. The three PV solar farms will cost $750 million to build, and the rooftop arrays will cost $540 million.

On Thursday, IEC's board also decided to establish a subsidiary, IEC International Ltd., to handle the utilities foreign ventures. IEC International will be registered in Cyprus, in order to operate in countries without diplomatic relations with Israel, and because of Cyprus's low tax regime.

IEC's foreign projects to date include the design of a coal-fired power station in South Africa in a joint project with France's Alstom SA (Euronext: ALO), a wind energy project in Bulgaria, and the construction of power stations in Cyprus and Greece. IEC is also in talks on designing power stations in India and Nigeria.

Bethel Finances: US, India, Israel have common targets in Asian region: Experts

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The experts of defence, foreign affairs, internal affairs and national security have said that United States, India and Israel have common targets and goals in the South Asian region.

This was said by the experts in a seminar arranged by Institute of Policy Studies (IPS) here on Wednesday.

Chairperson IPS Senator Professor Khurshid Ahmad while addressing the seminar said that superiority, interference and presence in independent and sovereign states always remain the part of US foreign policy.

He said after the 9/11 incident the world powers had made effective strategy for the countries having important geo-strategic location, adding that the threats for national security have increased.

He said the war against terrorism created complex situation regarding peace, adding that according to the charter of United Nations every country has the right of self defence and self defence is the right of every country in case of foreign interference.

He said that US landed in Afghanistan with aim of permanent residence, adding that the aim of US, India and Israel regarding the region is same.

The war against terrorism has promoted the regional and international terrorism, adding the anti-American sentiments increased in people. Drone attacks increased the number of suicide attacks as well as this war has badly disturbed the economy of US, he added.

He said that US is facing serious reaction in this war and it is due to the direct interference of US in the war.

Former secretary of foreign affairs Akram Zaki while addressing the seminar said that injustice, economic and social discrimination are the main cause of terrorism, adding that the masses in Unite States think that why the people of the South Asian region are against US.

He said that US President Barrack Hussain Obama is the production Wall Street and Main Street is against Obama, adding that if the people raised their voice against war then possibly the war would be end and peace would be restored in the world.

Former chief ISI lieutenant general (retd) Asad Durrani while addressing the seminar said that the role of Pakistan cannot be undermined for peace in Afghanistan, adding a number of Afghan families residing in Pakistan and both courtiers have religious, geographic and historical relations.

He said peaceful Afghanistan is in favor of Pakistan and due to drone and missile attacks US is in state of war with Pakistan, adding that bearable resistance is necessary for the process of peace. Common Afghan citizen is aware of importance of Pakistan and Pakistan has still a number of cards, he added.

Rustam Shah Mohmand while addressing the seminar said that there is an uncertainty in Afghanistan, adding that the allied forces failed to achieve their claims. American forces entered in Afghanistan for the purpose of access to resources of oil and gases in Central Asia and for the surveillance of atomic weapons of Pakistan.

He said that US has constructed its permanent bases in Mazar-e-Sharif, Bagram and Kandahar, adding that China should review its national security policy and Pakistani policy makers should also have to review its policy.

Director General IPS Khalid Rehman while addressing the seminar said that allied forces have completed ten years in Afghanistan, adding that the situation of the region has become worsen and masses are facing insecurity.

Bethel Finances: Successful Development, Bright Future

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October 1, 2011 marks the 62nd anniversary of the founding of the People's Republic of China. 62 years since its founding, especially over the past 33 years since its reform and opening up, China has awed the world with stunning development. China's development has attracted increasing international attention.

How do we view China's development?

In the past 62 years, over 200 million Chinese have been lifted out of poverty. 1.3 billion Chinese now have enough to eat. In the past 33 years, China's annual economic growth reached 9.9%. China's GDP totaled US $5.88 trillion in 2010, making us world's second largest economy. We top the world in the number of cars produced and sold as well as internet and cell phone users.

Some believe that with the US and Europe entrenched in the sovereign debt crisis and lack of economic driving force, China will soon catch up with the West. This view fails to see China as it is. As our reform and opening up deepens and our economy and society develop, China's future is ever more interconnected with that of the world. The US and Europe debt crisis have harmed their own economies. They also show that world economic recovery is still unstable and uncertain. China is not an outsider in the volatile global economy. We also face a number of major challenges. With a population of 1.3 billion people, our GDP per capita is around US $4,000, ranking after 100th internationally, which is less than one tenth of that of Canada and even less than that of many African countries. Based on UN standards, 150 million Chinese, which is five times of Canada's total population, still live in poverty on less than one dollar a day. 10 million Chinese have no access to electricity. China needs to provide 24 million jobs each year. China still suffers from a weak economic foundation, uneven rural, urban and regional development, unreasonable industrial mix and insufficient productivity. We may be a big country in terms of population, but we are a small country in terms of economic size per capita. China's reality matches our status as a developing country.

China's economic and social challenges are perhaps the toughest nut to crack. We have no reason to be arrogant. It takes generations to achieve greater prosperity and improve the Chinese people's livelihood. Even when China's GDP per capita approximates that of developed economies, our economy performance and quality of living will still be far behind.

Is China's development sustainable?

The answer is yes.

No country can avoid the "growing pains". Just as a train that has been running at high speed for 30 years would wear out, the problems in our fast development are natural. It is unwise to put China's future path in doubt simply because of these challenges. China is still in the middle stage of industrialization and accelerating phase of urbanization. This means China is still in great needs of infrastructural investment. In the next 20 years, we need to help over 300 million rural migrants relocate in the cities; upgrade people's consumption mix from food and clothing to moderate prosperity; and reduce the development gap between eastern and western China. Therefore, the Chinese economy does not lack power or potential. We have every reason to be optimistic.

China has formulated and is implementing its Twelfth Five-Year Plan, which calls for faster economic growth mode transformation. The Plan features economic growth model innovation, social development and further reform and opening up. Our main goal is to maintain China's stable and fast development over the long term to ensure that our progress is enjoyed by all Chinese. To meet this goal, we will focus on three priorities:

- Expanding domestic demand. We are working hard to adjust our national income distribution pattern, match income growth with economic development, increase urban and rural income to enhance people's buying power and tap into the world's largest consumer market. We are actively promoting universal access to basic public services, including education, employment, housing, health care, senior care and building a social welfare safety net, to ensure that the gains of our economic growth benefit all and boost our economy by stimulating domestic demand.

- Highlighting innovation and transformation. At present, contribution of scientific and technological progress to China's economy is 25% to 30% lower than that in developed countries. We will rely more on technological advancement and management innovation in boosting our economy. Meanwhile, we will accelerate the development of energy saving, new generation of InfoTech, biotechnology, high-end equipment manufacturing, new energy, new materials, new energy vehicles and other strategic emerging industries, to support our present and future growth.

- Focusing on green development. China is trying to catch up with the West in terms of per capita GDP, but our energy consumption per capita should never exceed that of developed countries, since the global environment is already under huge pressure. We will not follow the old path of western industrialized countries. Instead, we will pay close attention to ecological costs and effects; develop clean, renewable energy and a circular economy; actively respond to climate change and transform our extensive economic growth pattern to a low carbon and green one.

What does China's development mean to the world?

Over 2000 years ago, China's classical work "Book of songs" writes, "… people who are heavily burdened need a little ease. This shall preserve the kingdom and world peace." Today, a "moderately prosperous" life in China means having access to education, income, medical care, senior care and housing- a life more than just sufficient food and clothing. It also means national prosperity and well-being while at peace with neighboring countries. These are China's development goals today: building harmony within and around the world. China will be accountable to its 1.3 billion people. Meanwhile, we will not shrink from our responsibilities for world peace and development. In doing so, China's development will benefit not only the Chinese but people worldwide.

Ever since the beginning of our reform and opening up, China has made safeguarding world peace and promoting common development as one of our three historic missions. In recent years, China has also proposed to facilitate the building of lasting peace, common prosperity and harmonious world. We are closely following international and regional affairs. China has been active in responding to global issues such as energy, food, climate change, terrorism, natural disasters, infectious diseases, financial crisis and DPRK and Iran nuclear issues, Arab-Israel conflict, Darfur as well as other regional hotspots. Moreover, China has been a responsible player, builder and contributor in the building of international order. The current international order is not perfect. It needs to be reformed to answer the call of the times and be fairer and more justified. China is ready to be more active in international rule-making and improvement and continue to undertake international responsibilities and obligations in line with our national capacity. Finally, China has been consistently promoting domestic and world development. On one hand, we concentrate on solving our own development issues. As a major country, China's continuous development can benefit the world at large. Over the past five years, China's contribution to the world economy exceeded 20%, making us a crucial engine for global economic growth. Since China joined the WTO in 2001, our annual import averages US $ 750 billion. We have created over 14 million jobs worldwide. In the next five years, China's total import is expected to exceed US $ 8 trillion, which will create more business opportunities for other countries. On the other hand, China is an important player and champion in world development. We are willing to work together with other countries to advance the UN Millennium Development Agenda and jointly promote world prosperity and progress.

China's achievements in the past few decades are unprecedented. To better understand China, where China is going and seizing the immense opportunities brought in by China's development, the world needs to see China through our soaring growth and gigantic changes. China is also willing to have open and candid dialogue and cooperation with other countries. The world will see China as it is- a country of good faith, sense of responsibility and respect for others but a country that shall never be bullied; a country that has been advocating socialist democratic politics in accordance with its national conditions; a country that values, respects and protects human rights; a country facing numerous challenges, but always keeps a fresh mind and sticks to reform and opening up; a country that learns from others, pursues equal treatment, harmonious coexistence, mutual benefit and common development with other countries; a country that the world feels comfortable and confident in dealing with.

Bethel Finances: Infinity Fund and Harbin, China sign cooperation agreement

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Infinity Private Equity today signed a cooperation agreement with the City of Harbin, in northern China. It will invest $10 million in ten Israeli high-tech companies that are planning to expand in China.

IDB Holding Corp. Ltd. (TASE:IDBH) chairman Nochi Dankner and Ron Lauder attended the signing ceremony in Tel Aviv. Dankner said that he loves China and visited it two weeks ago with his team and family, and that he expects to sign the final agreement for the sale of Makhteshim Agan Industries Ltd. (TASE: MAIN) to China National Chemical Corporation (ChemChina) this week.

Harbin Mayor Lin Duo was also present. He will meet Prime Minister Benjamin Netanyahu and Israeli business leaders.

Infinity and its technology incubator in Harbin will invest an average of $1 million in each company. The investments will be in the form of venture capital loans, in exchange for holdings in the companies. The participating companies will receive a range of free benefits from the Harbin Municipality, including offices and manufacturing facilities, assistance in registering intellectual property, accounts, legal services, and personnel.

Infinity also signed a memorandum of understanding (MOU) with BDH Group subsidiary Feng'ao Ltd., which focuses on companies' business opportunities outside of China. Infinity expects to sign more agreements of this kind soon.

Infinity managing partner Avishai Silvershatz said, "Many companies want to enter the Chinese market, but don’t know where to begin. This program not only offers a package of benefits, it has an interest in helping companies developing, adapting, and marketing their products in China."

Framework agreements were signed today with BotanoCap Ltd., Innovative Implant Solutions Ltd., Sonarium Medical Ltd., and Rotec Reverse Osmosis Technologies Ltd. A shareholders agreement was signed with Chinese electrical products company Codo. A separate framework agreement was signed with Yissum Technology Transfer Company of the Hebrew University of Jerusalem.

Harbin, the capital of Heilongjiang Province, has a population of 10 million. It had a strong Jewish community from the late 19th century through the end of World War II, which numbered 25,000 people at its peak. Former Prime Minister Ehud Olmert's grandfather is buried in the city.

"I understand that Israel is strong in high tech, and green, environmental, and agricultural technologies," Duo told "Globes". "I am sure that we have a lot of potential for cooperation in these fields."

"Globes": Do you have agreements with other countries?

Duo: "IDB and the City of Harbin have set up a commercial, science, and technology cooperation program. We have agreements with 100 countries, but we are sure that cooperation with Israel, IDB, and Infinity is an important part of our cooperation network, perhaps because there was once special cooperation and brotherhood between the Jewish community and Harbin."

What companies are you seeking?

"We want companies with new initiatives, especially in high tech, IT, and green technology, but also in pharmaceuticals and electronics. Harbin is a strong city and it has proven R&D capabilities. We want to cooperate with Israeli companies and help Israeli businesses find investment opportunities in China."

Infinity manages $700 million in 12 funds, 10 of which are in China. It is a partner with IDB, CSVC, and the China Development Bank.