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There are some lessons from Israel's success

No matter what President Trump says or does, this century belongs to Asia. It will be 50 per cent of the world's economy in no time with half of the world's middle-class customers.

The middle class has driven the growth of Europe for more than 300 years. And in America, when Henry Ford doubled his workers' salaries so they could afford a motor car, he created the consumer momentum that made the US the economic force of the 20th century with 5 per cent of the world's population controlling 25 per cent of the world's economy.

But there are other places now where the catalytic forces of immigration and innovation, which established the US, are creating new opportunities.

One of them is Israel, where I have been this week. Its 8½ million people are crammed into an area about a third the size of Tasmania with no natural resources.

And while being on a constant war footing, Israel produces more start-up companies than Japan, India, Korea, Canada and Britain combined.

It should be no surprise that this tiny country has more than 10 per cent of the world's cyber-security industry and it's doubling every year.

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And the booming innovation companies work in fields as diverse as medicine and irrigation. It's not surprising that a country that transformed desert into a fruit and veg bowl would have invented drip irrigation.

"Without that I wouldn't have had a tomato this summer," grins Charlie.

Three things stand out.

First. Israel's motivation is the survival of its people. Let's not forget that it's a land of immigrants, bound together by a shared commitment to build a safe and prosperous nation. Charlie thinks that three years' compulsory military service for all young men and women toughens both body and mind.

Second, the Israelis have an enormously strong family culture.  I built my business on the simple domestic values of telling each other the truth and when arguments occur they are fixed before bedtime.

Most of our competitors spent a huge amount of time fighting among themselves because they didn't address their problems by the end of the day. Families, companies and nations succeed with these values.

And third, some Israelis are not afraid to question authority, be it the boss or the government. And what's more, authorities usually listen. We should all know by now that if you tend to surround yourself with people who only agree with you, collapse is just around the corner.

That is the story of the great Napoleon and it will be the fate of some current leaders who don't have the capacity to listen to news they'd rather not hear.

There was a good example just before I left. The governor of the Bank of Israel said: "The key to realising the economy's potential will be the development of policies that address economic issues of inequality, inefficient regulation and the need to increase both investment and human capital."

Which raises a fourth great strength in fact: success through risk taking. The Financial Times reports: "While some 'old-economy' companies and industries are stagnating or struggling, the country's growing technology sector is a magnet for inward investment and a continuing source of jobs – including for its underemployed Palestinian and ultra-Orthodox minorities.

"The industry accounts for 18 per cent of gross domestic product and more than one-third of the country's total exports."

The governor's agenda should be ours – reduce inequality, eradicate inefficient regulation and boost our investment and human capital.

We are not doing enough and with Benjamin Netanyahu's visit to Australia in a week or so we should listen; we can really learn from Israel. I'm told  Australian politicians were through here in serious listening mode a little while ago: Josh Frydenberg, and also late last year, Victorian minister Philip Dalidakis on cyber security. Clever!

But the story of Israel cannot end without an account of my visit to the Hadassah Medical Centre, part of the Hebrew University and with one of the world's great cardiologists, Professor Chaim Lotan, doctor at one time to former president Shimon Peres, who died last year aged 93.  

Chaim asked if I wanted to witness two simultaneous heart operations. Now I hate the sight of blood and I had my own heart somewhere near my mouth as I walked into the central control room for operating theatres.  On the right was an older Jewish man and to my left was a 12-month-old baby.

And the team performing these lifesaving operations within sight of the wall dividing Israel from the Palestinian territory was made up of Arab Israeli and Jewish technicians, side by side. This is as you would expect from doctors of course.

But it struck me strongly that here in the operating theatre the animosities of the outside world didn't mean a thing.

I wished the world's leaders could have been there. Both patients survived because of the day-to-day skilful co-operation of people across perhaps the most publicised of divides.

It was one of the most memorable experiences of my life.

Harold Mitchell is a director of Crown Resorts.  

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