AP PHOTO BY J OAO S ILVA • A line of Israeli tanks in the West Bank. of. a -rociao-nr hni-xxnaan clicric.irNtLe a f Elbit and IAI. The second would handle commercial aviation and include portions of IAI and TAAS. A third division would be elec- tronics and space, including mil- itary electronics. This would include departments of IAI, Rafael, TAAS, Tadiran Ltd., and Elisra Electronic Systems Ltd. The fourth would deal with am- munition and include parts of TAAS and Rafael. The fifth would handle ar- mored vehicles, including up- grading and protection of artillery and would merge parts of TAAS, Rafael and lAl's Ram- ta plant in Beersheba. The final division would be re- sponsible for tactical missiles and include portions of Rafael and IAI. Defense industry analysts say the government is not taking this re- organization proposal seriously. Zev Bonen, former director of Rafael and today a researcher at Bar-Ilan University's Begin-Sa- dat Center for Strategic Studies, does not like Mr. Rein's ap- proach. He has advocated that first the government should re- organize its own industries and then sell off divisions it no longer needs. Mr. Bonen pointed to Tadiran and Elta, IAI's electronics divi- sion, advocating that the gov- ernment sell Elta to Tadiran and eliminate duplication in mar- keting, production and research. The government could first put all electronics in one division, missiles in another and then pri- vatize, he suggests. He is skeptical, however, about making one huge corpora- tion. "I don't think it's a good idea," he says. "It would have tremendous power and the De- fense Ministry would not have the force to control it." Defense Ministry officials, however, do not want to priva- tize. When Lockheed Martin of- fered to buy TAAS's heavy munitions industry last May, they objected. They forecast that the defense industries, through manpower cuts and efficient management, can lower their losses. In the end, Lockheed Mar- tin was sold and the offer to buy TAAS was dropped. 0 Tel: (810) 335-1309 Fax: (810) 332-5570 http://www.speedlink.net e-mail:speed@speedlink.net • TROTTER LAN DICE EXERCISE WAR1?.HOUSE "Buying and Selling Equipment Daily" custom shirts by marihn Custom Shirts & Accessories At Discotrited Prices Men's Fashion Coordinator & Shirt Designer For 20 Years 9CC-1235 OUR WAREHOUSE IS OVERSTOCKED!! Now is the best time to get a great deal on treadmills, steppers, rowers, Air Walkers, Nordic Tracks, upright and recumbent bikes, dumbbells and more!! 7,-111 -171-1r1117-PITATIETIDIF government companies," he says. "There is no rationalization. Is- rael is 15 years behind the rest ] of the world in terms of reorga- /__ nization. "The government is impotent. It can't do anything except pass the buck from person to person." Mr. Rein warns that the govern- ment is already spending $1 bil- lion a year to keep the defense industry from collapse. About $850 million alone went to IAI over the last three years. In contrast, Mr. Rein says U.S. / -) defense contractors, which have merged into three giant corpo- rations, are now entering niches that were once exclusively Is- raeli, including unmanned air ve- hicles, electronic warfare, reconnaissance and executive jets. He says the problem will be- come acute after the year 2000. That leaves the government the owner of IAI, TAAS, Israel %' Military Industries and Rafael. Prime Minister Binyamin Ne- tanyahu campaigned last year on a pledge to rapidly sell-off gov- ernment companies, including defense contractors. In his early months of office, he urged his aides to do exactly that. The results, however, have been meager. The government's • privatization plan is identical to the 1996 plan submitted by the Labor government of then Prime Minister Shimon Peres to sell-off 13 companies. And when it comes to the defense industry, Mr. Netanyahu has no plans to privatize for at least the next two years. Moshe Leon, Mr. Netanyahu's economic adviser responsible for \_„ privatization, says the defense in- ' dustries are the last on the list. "The policy is that there must be all sorts of steps taken before we can discuss privatization," he says. `There isn't the conception yet." Mr. Rein's proposal calls for the reorganization of both state and privately-owned contractors into six divisions under one man- agement. Assets would total $2.5 billion and each division would have an individual function. The first would upgrade and sell warplanes, as well as to pro- duce unmanned air vehicles (UAVs). This would be the result New & Used 810-476-2213 20778 Orchard Lake Rd. 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