Trade exchange brings dollars to California, ham to Israel

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Just two years since the formation of the California-Israel Exchange (CIX), Israel is preparing to reap one of its first dividends — a shipment of kosher salmon "ham."

The take-off on the treat produced by the Northern California company Netmark is just one of a number of successful byproducts generated by the fledgling public-private corporation Gov. Pete Wilson formed in 1992.

Wilson, with about 40 government, trade and business representatives, gathered in Sacramento last week to find that a diverse range of products form the economic foundation of the CIX.

While big-name computer firms like Intel and Microsoft continue expanding their presence in Israel, the smaller businesses that make up the bulk of the CIX's 71 projects are making an impact, too.

"The CIX is not for the Intels of the world, but the future Intels of the world, those who see export as their new frontiers," Sherwin Pomerantz, director of the CIX-Israel Office, said.

Among the other products benefiting from the CIX are natural cosmetics, vitamins, aluminum and computer parts.

The CIX's successes include an exclusive distribution rights agreement for Cosmania Cosmetics of Chatsworth with Yaniv-Chen Ltd. in Netanya and Intrak Inc. of San Diego with Israel's Mashsov Ltd.

First-year exports for Cosmania are expected to reach $100,000, and between $20,000 to $50,000 at Intrak Inc.

"We're a prime example of the non-Intels of the world," Jerry Meyer, Intrak of San Diego marketing manager, said. "They [Intel] have more people in their lobby at any one time then we do in our whole company.

"We knew we needed patience and money to grow, and ultimately, we needed someone to run interference when contact was difficult."

The CIX was established to create jobs and revenue in California while increasing investments in Israel. The office links California and Israeli businesses and matches California funds dollar for dollar with private donations to nourish those partnerships.

So far, the CIX has raised nearly $150,000 in private and government funding, including $10,000 earlier this year from the San Francisco-based Koret Foundation. In 1994, the office also sank $3.5 million into the California economy, it says.

CIX executive director Rosalie Zalis, who is also Wilson's Jewish community liaison, calls the CIX a "win-win" balance of trade.

The CIX helps build cultural as well as economic connections. Pomerantz admits dealing with Israel "isn't always easy," so part of his job is "bridging the cultural gaps between countries."

For example, the salmon "ham" deal almost spoiled because "both companies were ready to move, but the language [that was] used somehow led both to believe the deal was dead," he said.

That's when the CIX "picked up the ball," he added.

Besides updating the CIX board of directors and interested businesses on the group's latest connections, Zalis discussed increased funding, science and technology opportunities, and a "raised level of consciousness about export opportunities to Israel."

For example, Lee Bailey, executive director of the U.S.-Israel Science and Technology Commission, said the government panel has budgeted $60 million in grants that U.S. and Israeli firms can seek to develop Israeli technology and build industry.

Three federal grants, each for about $2 million, have been awarded to American companies to develop long-term, high-business-risk technologies in Israel. Among the grant recipients is a solar-power project that was partnered with Israel's Department of Energy.

The commission, instituted by President Clinton and Israeli Prime Minister Yitzhak Rabin, recently completed its second round of grant applications and expects to make its awards in July.

These sorts of developments, Zalis said, show the CIX "is not about politics, is not about religion. It's about investing in Israel in a way the state of California benefits too."

Meanwhile, several California businesses are developing ties to Israel — independent of the CIX. A number of states are also looking to model themselves after California and Massachusetts by establishing formal trade representation with Israel.