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The Industry, Trade and Labor Ministry is initiating two big changes to increase employment in the country's outlying areas: Changing the conditions for state grants to industry and financing the employment of newly graduated engineers.

Today, manufacturers who want to receive a state-funded grant must export at least 25% of their production based on their investment using the grant. Instead, Industry, Trade and Labor Minister Benjamin Ben-Eliezer (Labor) is proposing an emergency regulation to cancel the export requirement for companies in the periphery and hire new employees. The export requirement kept most food companies from receiving such grants.

The other target is to employ hundreds of computer engineers in industrial firms, in a project initiated along with Motorola Israel general manager Elisha Yanay The ministry would fund the salaries of about 400 engineers in their first year of work after graduation as long as the company employing them commits to keeping them on afterward.

The present grants to industry fall under auspices of the Encouragement of Investment Law, which will expire in 2011 states this year's Economic Arrangements. Until a new investments law takes effect then, Ben Eliezer wants to make his proposed changes under emergency regulations.