1. ISRAEL Vision To Become One of the 15 Leading Countries in Quality of Life Second Annual ISRAEL 15 Conference 16 th of Sivan 5769 June 8, 2009

2. 2 Heavy security burden Weak education system Low participation in work force Danger of Collapse Large Gap in Quality of Life According to The Economist Israel ranks 38 th in Quality of Life Israel is 2 nd in the world in the export of Human Capital Developed Countries Leapfrogging is not a luxury; it is a necessity! Israel Must Leap Gaps continue to widen Israel

3. 3 ISRAEL15 Vision: Becoming one of the fifteen leading countries in terms of Quality of Life This Vision requires a Social and Economic Leapfrog in order to close the gap in Quality of Life between Israel and other developed countries ISRAEL15 Vision

4. 4 Israel leapt between 1951-72 Since then, Israel has grown by 1.5% and has not closed the gap During this time, Singapore & South Korea both leapt Israel Singapore South Korea 0.2.4.6.8 Countries that have Leapt US = 1 Western Europe 195019601970198019902000 2007 Source : Professor Ricardo Hausmann GDP Rate Compared to the US (1950-2007) 30% of the US 60% of the US

5. 5 Growth, Accelerated Growth, Leapfrog Source: Prof. R. Hausmann et al., Growth Accelerations Only 13 “Economic Miracles ” Leapfrog Almost all countries experience Growth 0.2.4.6 8.8. Years X X+8X+25 Real GDP per Capita % Source:World Bank, Growth Report Only 1 in 4 experience Accelerated Growth

6. 6 Public Sphere A Shared Future Savings and Investment Dedicated Elite A pact Unique and Global Central Brain, Elite Task Forces The Public Sphere is Critical Vision Leadership and Politics Values Institutions Development Policy Labor Market

7. 7 Common Denominator for Countries that Leapt Values Future orientation A variety of market economies Pragmatism Inclusiveness Trust

8. 8 Central Brain Institutions A Pact Identifying Analyzing Relevancy Trends & Elite Task Forces Ability to Execute Decisions Flexibility in the Market

9. 9 New Deal in the Labor Market Industry Labor Government Workers agree to flexible labor markets in return for improvement of Human Capital & safety net Employers flexible to hire and fire in return for a commitment to keep to employment laws Government provides a safety net & training in return for improvement in competitiveness Protect the Worker not the Job

10. 10 Unique and Global Development Policy אתרים היסטוריים מערכת הביטחון העולם היהודי פיתוח המדבר Unique Global Development Policy Global Trends Unique Assets Policy Inputs Standardization, Legislation Regulation, Infrastructure International Agreements Not Just Money! The Holy Land Defense Industry Jewish World Greening the Desert Rise of China and India Global Water Crisis Renewable Energy Aging Populations Rise of Africa

11. 11 New Regional Development Global and national competitiveness Exploit comparative advantage The region generates the change Growth at the local level Israel has regional diversity Regional Approach

12. 12 Israel is Not Talking Leapfrog PolicyInstitutions Domestic Industrial Policy Labor Market: Pact for Growth Unique & Global Development Policy Local Government Ignored No Vision Local Government Necessary Vision Necessary GrowthLeapfrog EconomicsMultidisciplinary Labor Market: conflict

13. 13 Unique Opportunity for Change Establishment of the Roundtable New Government: Stability for 2 yrs Crisis Breeds Willingness Why Now?

14. 14 What should we do Tomorrow? A Vision is Necessary Labor Market : New Deal Unique and Global Development Policy Macroeconomic Stability (+-) Reorganizing on the Local Level Central Brain Israel 15

15. 15 On the ISRAEL 15 Vision: “This is a very impressive document, based on clear thinking and a knowledge of the recent experience and writing about growth at various stages of development.” Professor Michael Spence, Economics Nobel Prize Laureate, and Head of the U.N Commission on Growth and Development