Multinationals Raise Profile In Israel

In light of the Arab boycott of Israel, most multinationals havetraditionally kept a low company profile in the Israeli market. Their products were to be found, but the marketing and often manufacturing were usually left in the hands of a local partner. Some companies did have their own subsidiaries, but these were few and far between, and the ownership of such affiliates was, comments the Marketletter's local correspondent, "convoluted to say the least."

However, in the last couple of years, and particularly in the last year, a quiet metamorphosis has taken place. The greatest stimuli for change were the Oslo accords and the Israeli-Palestinian peace process. But even before this there were other contributing factors.

One of the most notable was the rationalization and consolidation of the international, R&D-intensive pharmaceutical companies. On merging, many found that their local operations consisted of a web of obligations and arrangements which prevented or delayed an integrated, more hands-on approach than their headquarters might be seeking. For example, one of the leading international companies, the result of such a merger, found that today its products are being distributed via three different channels.