Believe it or not but the current turmoil taking place in South Ossetia, and the capital, Tskhinvali is impacting Israeli businessman as well. According to report in Globes, ” The former Georgian ambassador to Israel estimates that Israeli real estate, defense, and other investment in Georgia exceeds $1 billion, and that the Russia-Georgia war is putting these investments at risk.”

Tourists have started returning to Israel and companies located in the surrounding areas have begun to evacuate their employees. Israel has come under pressure over the last 24 hours to halt arms sales to Georgia. The Jpost reports that actually, Israel halted shipments of arms a couple of months ago as the government sensed that conflict was imminent. According to an Israeli defense official, the article quotes: “Several months ago, we carried out an evaluation of the situation in Georgia and realized that Georgia and Russia were on a collision course. We have good relations with both, and don’t want to back either in this conflict,” the official said. “We therefore made a decision to drastically minimize sales of weapons to Georgia.”

Israel has successfully forged very good relations with both Russia and Georgia. Let’s hope that this current conflict doesn’t change that.

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Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.

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