[Cz-L] Israelis helping Romania

Here is an article from the Wall Street Journal, this week. Now I
understand why in our brief stay in BUC last May, Prigat juice and Elite
were all over the place. Also, and I bet most of you and me did not know
that the hora comes from Romanian Jews...

The writer is apparently not familiar with CZ because he mentions "Due to
shifting borders, 200,000 Romanian Jews [THEM ARE US !!!] were living in
Soviet territory and many died" .

Wolf
-------------------------
      October 4, 2006

Lucrative Return Israeli Investors Find Opportunity In Romanian Roots
Children of Holocaust Arrive To Modernize Bucharest, Communist-Era Farms
Importing 1,200 Dairy Cows

By JOEL MILLMAN

BUCHAREST -- In 1993, Moshe Arbel returned to Romania, 45 years after he
arrived in Israel with thousands of other children orphaned by the
Holocaust. He found his mother's grave, hired caretakers to maintain it for
$12 a month, and spotted something else -- opportunity.
Romania was a country stirring to life economically after the fall of
communism, he told his employer, Givat Haim, a kibbutz that makes
Prigat-brand fruit juice. "I said, 'Back me and I'll make money in Romania.'
They said, 'Romania? There's more money in Netanya [a nearby town] than in
all of Romania.' Meshuga -- crazy -- they called me," Mr. Arbel recalls.
With a $175,000 loan from the kibbutz, the 63-year-old marketing specialist
began bottling Prigat fruit juices in Romania, turning the brand into the
country's top seller. This summer, he sold the Romanian unit for about $7
million to PepsiAmericas, a Minneapolis-based bottler.

In a historical twist, the children of the Romanian Holocaust are playing a
leading role in modernizing the land of their parents' tragedy. Israeli
expatriates have started local businesses in agriculture, retailing, real
estate and heavy construction. Branch offices of firms based in Tel Aviv and
Haifa handle everything from hotel management to insurance to car leasing.
Many of the office parks and shopping malls rising in Bucharest's suburbs
are being financed by Israeli hedge funds, while Israeli engineering firms
are managing European Union road and water projects in the countryside.
The Israeli presence is so large that Bucharest hotel lobbies and
restaurants buzz with Hebrew speakers. On Thursday nights, the two-hour
flights between Bucharest and Tel Aviv are packed with Israeli business
commuters heading home for family weekends -- and Israeli gamblers bound for
Bucharest's casinos, four of which are operated by Israeli entrepreneurs.
Israeli licensees in Romania market Kodak film, Pepsi and Cadbury Schweppes
soft drinks and Tuborg beer.
Businessmen here estimate that Israelis have invested as much as $2 billion
in Romania over the past 15 years, a huge sum given Israel's population of
six million. Much of the investment has been routed through third countries,
mainly in Western Europe, to take advantage of tax deals. Counting such
indirect investment, Romania ranks with the U.S., China, India and Western
Europe as a top destination for Israeli capital, says the nation's
commercial attaché in Bucharest.
For Israel, whose trade with its Arab neighbors is limited, Romania
represents a growth market. Apart from catering to a Romanian market of 22
million, Israeli firms located here can take advantage of regional trade
pacts to export duty-free throughout Europe. Starting Jan. 1, when Romania
joins the EU, the estimated 30,000 Israelis who also have Romanian
citizenship will gain EU citizenship and ultimately be able to work, study
and travel freely across Europe.
As a result, thousands more Israelis are queueing up for joint citizenship.
"We call them 'born-again Romanians,' " jokes Michael Faint, an animal-feed
merchant from the United Kingdom based in Bucharest.
Romania benefits, too, from the Israeli connection. Israelis provide money
and technical expertise to a nation that must build its economy to EU
standards. Israeli agricultural companies play an especially large role in
revamping Romania's farm sector, which was set back by Communist-era
mismanagement. "Israeli companies are helping to make a modern Romania,"
says Jose Iacobescu of the Chamber of Commerce and Industry of Romania, who
says that Israeli firms employ between 150,000 and 200,000 Romanians.

Tangled History
Israel and Romania have a tangled history. During World War II, Romania was
ruled for two years by the fascist Iron Guard, but was one of the few Axis
supporters never occupied by German troops. Due to shifting borders, 200,000
Romanian Jews were living in Soviet territory when Hitler's forces invaded,
and many died.
Yet 350,000 Romanian Jews survived. Most migrated to Israel, where they so
dominated their new society that much of what is considered traditionally
Israeli has Romanian origins, including Israel's national folk dance, the
hora. Under the Communist regime of Nicolae Ceausescu, Romania was the one
Soviet-bloc nation that never broke ties with Israel. The two states even
collaborated on intelligence matters.
However, lingering anti-Semitism still makes Romania a tricky place for Jews
to do business. Last December, an ultranationalist group, Dacia Nemuritoare
("Immortal Dacia," Romania's Bronze Age name), listed the country's top
Jewish entrepreneurs and the law firms and banks they work with. A weekly
publication of a right-wing minority party, Greater Romania, published a
column last year that claimed that Jews with dual citizenship were planning
a stealth "depopulation" of the country by dismantling the public-health
system and forcing natives to emigrate for work.
Worried about being targets of prejudice, some religious Israelis doff their
yarmulkes upon arrival in Bucharest. Many companies register offshore, which
obscures their Israeli roots. Strauss International Ltd., a well-known
Israeli chocolate maker, sells Romania's leading brand of roasted coffee,
called Elite. Its Romanian operation is part of its Amsterdam-registered
subsidiary. "Romanians are completely unaware of the Jewish origin" of these
brands, says Stefan Liute, a Romanian who works for Grapefruit, a Bucharest
brand consultant.
Indeed, Prigat researchers discovered that many Romanians think the brand
name, which means "fruit of the wine press" in Hebrew, dates to Romania's
pre-Communist era. But Mr. Arbel, the company's head, says account
representatives faced resistance from some Lebanese and Syrian restaurateurs
who have flocked to Bucharest.
Romanian-born Israelis began returning in great numbers around 1990. The
post-Communist government published lists of about 9,000 properties,
including hundreds of factories and hotels, that were seized either by Nazi
sympathizers after 1940 or by Communists after 1948. Israelis filed claims
for lost holdings, as did ethnic Hungarians, Germans and other groups. So
far, more than 200,000 claims have been made, and about 80,000 have been
adjudicated. Romania doesn't categorize them by ethnicity.
Successful claimants often flipped Bucharest properties to Israeli
developers, who spruced them up for sale to Austrian, German, Greek and
Italian businessmen entering the country. Israelis with dual citizenship
were also buyers, benefiting from a government policy that encouraged sales
to Romanians living abroad, says Jacob Fonea, a dentist from Haifa who today
heads the Romanian-Israeli Chamber of Commerce.
Dr. Fonea, who was born in Iasí near the Soviet border, was unable to regain
factories once owned by his family. But he remained in Romania and founded
the AIE Group, which bought a former state-owned woolens weaver and a
bankrupt tableware company, among other firms, and now exports a variety of
goods to Europe. He says AIE has annual sales of around $100 million and
employs some 7,000 Romanians.
Israelis of Romanian descent created a web of businesses. When Prigat needed
a juice bottler, it turned to Amraz Ltd., Israel's largest producer of
plastic containers, which set up a local factory. Now Amraz is exporting
plastic bottles into Croatia and France.
Similarly, Israeli architects work for Israeli developers who hire Israeli
construction firms across the country. Israeli hedge funds are buying
farmland to be managed by Israeli agronomists who tap Israeli kibbutz
members to run farms. Romanian authorities say there are about 3,500
companies registered in Israel that do business here. There are another
2,000 Romanian businesses owned by Israelis but registered in third
countries, according to diplomats and businessmen.
These close commercial ties date back to the collapse of the Ceausescu
regime. Israeli contractors reconditioned Soviet-supplied MiG fighters for
Romania's air force and later, with U.S. permission, sold surplus U.S. F-16s
to Romania.
At the same time, many Romanians headed to Israel for jobs when their
country plummeted into recession during the 1990s, and Palestinian unrest
prompted Israel to rely less on Arab laborers and recruit guest workers
abroad. Eventually about 200,000 Romanians joined Thais, Chinese and
Filipinos working in Israel. Bucharest now bustles with Hebrew-speaking cab
drivers who bought their vehicles with cash earned in Israel.
Hebrew-speaking Romanians became a ready work force for returning Jews.
With Romania's economy growing at 5.6% a year over the past five years --
twice as fast as Israel's -- the country has become a magnet for ambitious
young Israelis who feel stifled at home. "Our country is saturated,"
complains Moran Morgenshtern, a 32-year-old veterinarian who worked this
summer breeding heifers in Romania. "If I ever want to run my own farm, I'll
probably do it here."

At Tnuva's first Romanian dairy farm, initial work -- including restoration
of concrete barns -- was mostly done by Romanian gypsies.
Ms. Morgenshtern's employer, Tnuva Central Cooperative for the Marketing of
Agricultural Produce in Israel Ltd., is Israel's largest food concern.
Founded as a dairy cooperative in 1926, Tnuva today has a 70% share of the
Israeli market and now looks abroad to expand. Romania has a special lure:
Once it joins the EU, it will get immediate access to the huge European
dairy market, which Israel has had little luck in cracking, so long as
Romanian producers can meet EU sanitary and food-safety standards.
Tnuva says it can meet those standards and help Romanian farms do the same.
It also cautions Romanian farmers that if they can't boost their
agricultural productivity, they will be swamped with cheaper agricultural
imports from more efficient farms in Western Europe. "I warn the Romanian
people, 'Follow me or else you will end up slaves of the West,' " says Yoram
Israeli, a 55-year-old, former kibbutz member who runs Tnuva Romania, and
who is jokingly called "Moses" around his Bucharest office.
Two-Stage Strategy
Mr. Israeli has a two-stage strategy. First, Tnuva is building a
yogurt-processing plant in Romania to make and sell Yoplait yogurt with milk
produced locally. (Tnuva already licenses and sells Yoplait, a French brand,
in Israel.) Afterward, Tnuva hopes to sell Romanian dairy products
throughout Europe.

Tnuva is building a plant in Romania to make and sell Yoplait yogurt
locally.
This year, Tnuva bought its first Romanian farm, a former Communist
collective near the village of Adunatti Copãceni, and imported a herd of
1,200 dairy cows from Germany. A few weeks before the first cows arrived,
workers, many Romanian gypsies, restored concrete barns that had been
stripped of metal fixtures, including roofs, by local scavengers. Israelis
cleaned the site thoroughly after inspectors discovered leucosis bacteria in
pools of stagnant water. That could have infected dairy cows and
disqualified their milk for sale.
The Israelis sought local dairymen who can meet EU standards. Next, Tnuva
hopes to persuade co-op members to advise local farmers, invest in Romanian
dairies and share technical know-how. "It's like playing matchmaker," says
Rafi Shaul, the Tnuva executive in charge of hunting for local partners.
Mr. Shaul, a chain-smoker with a thinning gray ponytail, works with Costel
Caras, a 48-year-old Bucharest native who began farming in 1994. Mr. Caras
turns to Mr. Shaul for advice on everything from how to mix feed to how to
qualify for EU farm aid.

Tramping through an overgrown pasture in July, Mr. Shaul praised Mr. Caras's
placement of a concrete corral and the cleanliness of his herd's stalls. He
winced at the sight of Mr. Caras's creaking water pump. "Some of these
farms," Mr. Shaul muttered, "look like Israel 50 years ago."
Later, over a lunch of Romanian cheese and eggplant snacks, Mr. Caras
complained that a wholesaler twice neglected to make pickups at his farm,
forcing him to dump his product. If that keeps happening, he'll go broke.
Tnuva competes here from France's Groupe Danone SA and the Netherlands'
Friesland Foods. Mr. Shaul said he suspects brokers may be punishing Mr.
Caras for working with Tnuva. Mr. Shaul advised the farmer to be careful.
"Don't worry about me. I am a free man," the Romanian said. "We need Tnuva.
We don't want just one buyer here."
Write to Joel Millman at joel.millman_at_wsj.com
Received on 2006-10-07 21:33:08