The chief scientist at the Industry and Trade Ministry, Carmel Vernia, yesterday announced an experiment to privatize state-run technology incubators. The trial will take place at three incubators and if successful, it would be expanded to all 24 state-owned incubators, Vernia said. Incubators support the initial stages of projects that are not attractive to investors in the private sector.

The trial privatization period, the chief scientist said, would last for 6-12 months and would initially involve incubators from among 10 that are currently managed by the government and private organizations.

Support for new startup projects will change from a royalty-bearing grant into a loan. Furthermore, financial aid for each project will increase from $300,000 to $400,000 and restrictions on spreading the sum out over a period designated by the incubator will be lifted.

A project that is accepted into one of the incubators will be owned by the private entrepreneur, the owner of the incubator and the government, through the loan. If the project eventually becomes a company, the owner of the incubator will be required to repay the government with the original amount of the loan.

Nisan 5761 - April 2001