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The Gap empire opened its first Israeli branch on Monday, after a three year delay. The store on Jerusalem's high-end Mamila Avenue makes Israel the 17th country in the world to host a Gap branch.

Gap's expansion to Israel is a positive sign for the company, which has been strongly affected by the global economic crisis.

The company is entering an apparel market in Israel already saturated with trendy clothing brands and stands to become even more so when the popular clothing store H&M opens in the spring of 2010. That store will be opening in the Azrieli Center in Tel Aviv, the same location where Gap plans on opening their second store.

Ron Young, Gap's senior vice president of international strategic alliances, told TheMarker that the delay in achieving a permit would have no bearing on the company's success in the Israeli market.

While H&M is a strong competitor, Young said, he is certain Gap will find its niche. The company offers clothing for all ages and styles, Young said, adding that Israel was a great example of a small market in which Gap could achieve enormous successes.