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Livonia, MI 48150 261-2530 48 EJohnson MTWTH 10-8 F 10-6, S 10-3, Sun, 10-3 •Plus Tax, License & Reg. FRIDAY, MARCH 22, 1991 DOWN RIVER'S LARGEST DEALER 525 Biddle Ave. Wyandotte, MI 48192 283-1970 D etroit area busi- nessmen Harold Berry, Sam Nivy and Paul Zlotoff are prepared to manufacture and send 300 homes to Israel. They have worked out details in the United States, hired an American partner in Israel and an additional liaison to work with coop- erating American and Israeli companies. They even found a Texas-based firm to produce the manufactured homes, and they made bids in Israel for the project. Their bid was rejected. "Each time we are ready to go with it, they provide us with a setback," said Israel project liaison Edith Rosaen. "Their requirements are unrealistic. The Israeli government wanted to have control over an open line of credit, which means they could draw money on the line of credit for any reason without our approval." The Israeli government's strict requirements and con- tinual changes in building codes have put a halt to plans that the company, Israel Housing Inc., believes would help their company provide living accommoda- tions for the massive influx of Soviet emigres to Israel. Mr. Cohen said the year 1990 brought 150,000 Soviet Jews to Israel. This year, 300,000 Soviets are expected and, in the next five years, 1 million Soviets are projected to make aliyah to Israel. Like many other American businesses, the founders of Israel Housing Inc. are baffled by the roadblocks they have discovered while attempting to do business in Israel. Yet Howard Cohen, presi- dent of Operation In- dependence, an interna- tional alliance of business leaders working to make Israel economically in- dependent, thinks he under- stands the problems. In a speech last week to members of the American Israel Chamber of Com- merce of Michigan, Mr. Cohen offered some solu- tions. He said Israel's leaders must find a new definition for national security. Without a new direction, Mr. Cohen said, Israel "will be in for some serious trou- ble. "Israel is the only place where Jews haven't pro- spered," Mr. Cohen said. "Israel needs to get to a market system in an orderly way. This means more econ- omic independence and less government intervention. "We are calling for changes in government policy," Mr. Cohen said. "We are begging for no government plans. We want to tell the government to get out of planning, get into policy and allow Diaspora America to work with the Israelis." A report released earlier this month advocates a pri- vate rental housing market in Israel. The Fogel report, conducted by Israel finance "Someone is going to have to beat on the Knesset to make them understand what business is." Torry Duffy experts Aaron Fogel and Schlomo Schattner, recom- mends massive land sales by the government, reductions on tax levies and the enact- ment of a national building code. Also suggested are changes in the capital market structure, which would include establishing industry mutual funds for investment. Under Mr. Fogel's plan, the rental industry would be privatized, leaving the Israeli government with no involvement. There would be no rent subsidies. The report was unveiled at an Operation Independence policy dinner in Jerusalem for members of the Knesset, academia, the business community and the Ameri- can Embassy. Mr. Cohen said Knesset members are expected to discuss the rec- ommendations in the coming months. Operation Independence, founded by Detroit philan- thropist Max Fisher, lobbies the Israeli government on behalf of organizations that wish to improve the climate for doing business in Israel. 01 encourages investment in Israeli business, helps Israeli firms find skilled in- vestment professionals and helps them understand the North American investment community. Today OI is focusing atten- tion in the Middle East on the huge demand for hous- ing. For the first time in his- tory, Mr. Cohen said, Israel will spend more on absorp- tion than on the military. "Absorbing Jews from the Soviet Union is as important as protecting ourselves," Mr. Cohen said. "Israel is talk- ing about change, which is good. But it is too slow. The problems are huge. Every night, when the joy comes because the Soviet immi- grants land, the problem grows." Shelly Jackier, executive director of the American Israel Chamber of Corn- merce of Michigan, said her office has been flooded with phone calls from business people who have faced set- backs similar to Israel Hous- ing Inc. "We can't answer all of their questions," Mrs. Jackier said. "Things keep changing." Detroiters Torry Duffy and Alex Itkin, a Soviet emigre, have been negotiating for a year to manufacture machinery and construction equipment in Israel. Mr. Duffy and Mr. Itkin, both engineers, formed Kairos Development Inter- national a year ago to iden- tify and set up cultural rela- tionships, trade agreements and joint ventures between American companies and organizations in Europe and the Soviet Union. Part of the Kairos plan was to establish business ventures in the Middle East. "It makes good sense to go into Israel," Mr. Duffy said. "Israel needs so much of the same things that the Soviet Union needs. We felt it was important to provide a manufacturing plant in Israel for the local economy and for export purposes. We want to provide materials that would be used for hous- ing." Mr. Duffy said Kairos has made more progress in the Soviet Union than in Israel due to Israeli government stipulations. "Someone is going to have to beat on the Knesset to make them understand what business is," Mr. Duffy said. "We hope to work things out. We are looking for an Israeli partner. For now, the program is on hold." ❑