Saturday, December 18, 2010

the real peace process: Israeli companies outsourcing to Palestinians

From The Associated Press, 17 December 2010:

HOD HASHARON, Israel (AP) — Within the pastel walls of a modest suburban office, Israeli high-tech workers have accomplished a feat that still eludes their political leaders: They have created a partnership with the Palestinians.

Israeli-Palestinian peace talks may be stalled, but that hasn't stopped a small but steady trickle of Israeli technology companies from seeking to work with people on the other side of the decades-old conflict.

Israeli CEOs say it's their way of bringing a little bit of peace to their troubled corner of the world. But the real reason they're hiring Palestinians, they acknowledge, is because it simply makes good business sense.

Israel's high-tech industry is among the country's crowning achievements. Israel has the most start-ups per capita in the world and has helped produce such game-changing innovations as instant messaging and Internet telephony. Many Israeli tech firms send work offshore to eastern Europe, India or China.

In the past three years, however, some have turned to Palestinian engineers and programmers. They are cheaper, ambitious, work in the same time zone, and — surprisingly to many Israelis — are remarkably similar to them.

"The cultural gap is much smaller than we would think," said Gai Anbar, chief executive of Comply, an Israeli start-up in this central Israeli town that develops software for global pharmaceutical companies like Merck and Teva.

At a previous job, he worked with engineers in India and eastern Europe, but found communication difficult. So in 2007, when he was looking to outsource work at his new start-up, he turned to Palestinian engineers. He said they speak like Israelis do — they are direct and uninhibited. Today, Comply employs four Palestinians.

Palestinian engineers have also warmed up to the idea. "I doubt you would find a company who says, 'I am closed for business'" to Israelis, said Ala Alaeddin, chairman of the Palestinian Information Technology Association....

...About 10 Israeli start-ups and international companies with centers in Israel have been outsourcing to the West Bank in the past three years, said Tova Scherr of Mercy Corps, an international aid group working to encourage these ventures. Scherr said visits by Israeli businessmen to Ramallah — with Israeli military permission — are becoming more common.

Networking giant Cisco says it was the first international corporation with research and development centers in Israel to begin outsourcing work to the West Bank. Israeli branches of Hewlett-Packard Co., Intel Corp. and Microsoft Corp. have followed Cisco's example and begun to outsource to the Palestinian territories this year, according to Mercy Corps.

...Word of the West Bank's potential is spreading: Tahboub of Asal Technologies said he received about 20 inquiries this year from Israeli companies.

"We are doing great work for our country," Tahboub said, referring to the yet-to-be-born Palestinian state. "I believe the (technology) sector will become one of the pillars of the Palestinian economy."
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