Israel’s tech sector has shown remarkable resilience amid the COVID-19 pandemic, the recent conflict with Gaza, and the political instability that has plagued the country for years. Despite the challenges and uncertainties, Israeli entrepreneurs and innovators have continued to work, create, and collaborate, producing cutting-edge solutions and attracting record-breaking investments.
Israel’s tech sector has long been seen as a global force, renowned for its innovation, resilience, and ability to thrive amid adversity. The growth of the ecosystem is a story of perseverance, ingenuity, and vision, driven by the talent and passion of the people who make up the “Startup Nation”.
The COVID-19 pandemic, which has disrupted the world economy and society, has also posed unprecedented challenges for the tech sector. However, Israel’s tech sector has managed to adapt and overcome the difficulties, leveraging its strengths and capabilities to cope with the crisis and even turn it into an opportunity.
According to the latest report by the Israel Innovation Authority (IIA), the tech sector has demonstrated remarkable resilience and recovery in 2020, despite the pandemic. The report shows that the tech sector grew by 4.5% in 2020, compared to a 2.4% contraction of the overall economy. The tech sector also increased its share of the GDP from 12.7% in 2019 to 13.2% in 2020, and its share of the total exports from 43.5% to 45.9%.
The report also reveals that the tech sector attracted a record amount of $10 billion in investments in 2020, a 27% increase from 2019. The investments were mainly driven by large deals, especially in the fields of cybersecurity, fintech, and healthtech, which have been in high demand due to the pandemic. The report also notes that the tech sector maintained its employment levels and even increased its demand for skilled workers, despite the high unemployment rate in the country.
A source of innovation and impact in times of conflict
Israel’s tech sector has also proven its resilience and relevance in times of conflict, especially during the recent escalation with Gaza, which lasted for 11 days in May and claimed the lives of more than 250 people. The tech sector not only provided essential services and solutions for the security and defense of the country, but also contributed to the humanitarian and social aspects of the situation.
One of the most notable examples of the tech sector’s role in the conflict was the Iron Dome, the missile defense system that intercepted more than 90% of the rockets fired by Hamas and Islamic Jihad from Gaza. The Iron Dome, which was developed by Rafael Advanced Defense Systems and Israel Aerospace Industries, is a technological marvel that has saved countless lives and prevented massive damage. The Iron Dome is also a symbol of the tech sector’s collaboration with the government and the military, as well as with the US, which has provided funding and support for the system.
Another example of the tech sector’s impact in the conflict was the use of drones, both for military and civilian purposes. Drones, which are one of Israel’s leading tech exports, were used by the Israeli Air Force to carry out precision strikes and surveillance missions, as well as by Hamas to launch attacks and propaganda. Drones were also used by civilians to document and share the reality of the conflict, as well as to deliver food and medicine to people in need.
The tech sector also showed its social responsibility and solidarity in the conflict, by offering various initiatives and platforms to help the affected communities and promote dialogue and coexistence. For instance, several tech companies and organizations donated funds and equipment to hospitals and shelters, provided free services and products to residents and businesses in the south and the center of the country, and organized online events and campaigns to support and empower the diverse sectors of the society.
A vision for the future in times of change
Israel’s tech sector is not only resilient, but also forward-looking, constantly seeking new opportunities and challenges for the future. The tech sector is aware of the changing needs and trends of the global market and society, and strives to position itself as a leader and a partner in the fields that matter most.
According to the IIA report, the tech sector is focusing its efforts and resources on four strategic domains that have the potential to create significant value and impact for Israel and the world: artificial intelligence, health and life sciences, industry 4.0, and sustainability. The report states that these domains are expected to grow rapidly in the coming years, and that Israel has the competitive advantage and the comparative advantage to excel in them.
The report also highlights the importance of fostering a culture of innovation and entrepreneurship in the tech sector, as well as in the broader society. The report emphasizes the need to invest in education, research, and infrastructure, to enhance the diversity and inclusion of the tech workforce, to strengthen the collaboration and cooperation among the various stakeholders, and to improve the regulatory and policy environment.
The tech sector is also optimistic about the prospects of peace and stability in the region, following the historic normalization agreements with the UAE, Bahrain, Morocco, and Sudan, known as the Abraham Accords. The tech sector sees the agreements as an opportunity to expand its markets and networks, to share its expertise and experience, and to create joint ventures and projects that can benefit both sides.
Israel’s tech sector is a beacon of resilience, innovation, and impact, not only for the country, but also for the region and the world. The tech sector has proven its ability to overcome crises and conflicts, and to create solutions and opportunities for the future. The tech sector is a source of pride and inspiration for Israel, and a model for others to follow.
