Bloomberg Businessweek USA - 09.03.2020

◼ ECONOMICS Bloomberg Businessweek March 9, 2020

29

KUDLOW: PHOTOGRAPH BY GABRIELLA DEMCZUK FOR BLOOMBERG BUSINESSWEEK; ORANGES: PHOTOGRAPH BY AMIR LEVY FOR BLOOMBERG BUSINESSWEEK. *ONLY INCLUDES GOODS EXPORTS. DATA: BANK OF ISRAEL, CENTRAL BUREAU OF STATISTICS

THE BOTTOM LINE Trump’s economic adviser’s penchant for

optimism may become a liability as businesses and investors await

a more robust policy response to the coronavirus pandemic.

The End of the

Jaffa Orange

Almost two centuries ago, Ottoman farmers in

what’s now Israel began cultivating a new citrus

variety, a sweet-but-tart-and-juicy delicacy called

the Jaffa orange—named after the historic port city

adjacent to today’s Tel Aviv. Exports surged as gour-

mands across the Middle East and Europe fell in love

with the fruit, and the Rothschild family made citrus

● The decline of the much-loved fruit highlights

the travails of farmers in a changing Israel

plantations the economic foundation of their efforts

to create a home for Jews in the region. When ref-

ugees flocked to the area in the early 20th century,

they quickly saw the potential of the Jaffa orange to

fund the state they dreamed of building.

But in recent years, the fruit has fallen on hard

times. Since peaking in the early 1980s at 1.8 million

tons a year, Israeli citrus production has dropped

almost 75%. That decline highlights Israel’s shift

away from its socialist, agrarian roots and its emer-

gence as a tech powerhouse. With a strengthen-

ing currency making exports less competitive and

scarce water supplies raising the cost of cultiva-

tion, oranges—and many other crops—are no lon-

ger worth the effort. Agriculture has fallen to 2%

of goods exports, from a peak above 40% in the

1950s, as the plains and gentle hills around Tel Aviv

have been bulldozed to make way for malls, apart-

ment blocks, and office parks for growing ranks of

software coders and pharmaceutical researchers.

“Land here in the center of Israel is so expensive,

most of the orchards were cut down,” third-

generation orange grower Idan Zehavi says in the

grove first planted by his grandfather.

Just 1% of Israelis now work in agriculture,

down from 18% in 1958, while the tech sector has

shot up from virtually zero to 10% of jobs today,

many developing software used outside the coun-

try. That’s helped double exports of services since

2008, to more than $50 billion last year—with

now well enough to have resumed playing tennis

every Sunday. He expects to stay in the administra-

tion until the end of this year but hints it’s unlikely

he’ll return for a second term. That doesn’t mean he

plans to retire. “My last rites will be at a desk or a TV

studio somewhere,” he says. �Shawn Donnan, with

Katherine Burton and Jennifer Jacobs

◀ Zehavi in the

orchard planted by

his grandfather

196819781988199820082018

100%

50

0

▼ Israeli exports*

◼Agriculture

◼Other

1958