Before we get started I just wanted to send a shout out to my in-laws, on the occasion of their wedding anniversary. Don’t say we never get you anything!

Israel is second to none when it comes to innovative technology for the water industry. From drip irrigation, to the water quality testing solution that was used in Beijing to keep the water events safe, Israel has been at the forefront of developing these technologies. It makes it all that more frustrating and shocking that domestically, Israel has been fast approaching a water crisis. With the country’s main water source at dangerously low levels and few calls for water conservation, a crisis seemed to be on the horizon.

Well finally a solution maybe brewing. Bids have been made to build and operate Israel’s 4th desalination plant. Funny that the country that developed the technology, has for the most part exported it to other countries to solve their water problems, but has been slow on the uptake to tackle the domestic issue. (But there is no use crying over spilled milk) According to Globes: “…that at least four or five consortia will likely submit bids today in the presorting tender to build and operate Israel’s fourth desalination facility at Soreq. The 100-million cubic meter a year plant will cost NIS 1.5-2 billion($500 million). The facility is due to come on line in 2012.”

Let’s just assume that it won’t be completed on time, and that it will come on line in 2013-2014. Still, it will go a long way in solving the domestic Israeli water crisis. Israel faces many challenges to its’ water supply from neighbors. Jordan, Syria and Lebanon, all have the ability to tinker ( to put it mildly) with the Jewish state’s water supply. Another water desalination plant will help Israel become more ‘water independent’ and self sufficient, which will also be crucial in limiting geopolitical risk.

It also wouldn’t hurt if some prayers would be directed to above to provide the country with some much needed rain.

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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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