Israeli Businesses Work to Recover Lost Income

Two weeks after the cease-fire with Hezbollah, life for Israelis in the country's north is returning to normal. Many businesses that depend on tourism lost income because of the fighting. But some are still hoping to make a little money before the summer season ends.

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RENEE MONTAGNE, host:

Two weeks after the cease-fire between Israel and Hezbollah, tourists are returning to northern Israel, some to see the damage caused by Hezbollah's Katyusha rockets, others to offer moral support, and some to enjoy the region's natural beauty.

The war hit the area's economy hard and hundreds of businesses are on the verge of closing. The government has promised compensation, but many are skeptical. NPR's Linda Gradstein visited northern Israel.

Mr. RONI LEVY (Business Owner, Israel): Raspberries, blackberries, plums. We have grapes - taste like mango.

LINDA GRADSTEIN reporting:

Roni Levy lights up when he talks about fruit, his fruit, that tourists have come and paid to pick for 25 years.

At his orchard in Moshav Sha'al on the Golan Heights, about two miles from Israel's border with Syria, and five miles from the border with Lebanon, you can pick and eat as much fruit as you want for $4. Levy also offers cabins for camping.

Usually in the summer he's jammed. But this summer the fruit has rotted on the trees and the cabins have stayed empty.

Mr. LEVY: One and a half months, I don't work. The prices of the fruit go down 50 percent, because there was not people that eat them. One and a half million people do not eat fruit, and if the fruit stays in the markets, then the prices go down.

GRADSTEIN: Levy estimates he's lost about $40,000 this summer. The Israeli government has promised compensation to business owners like him. But he says there's a lot of bureaucracy involved and he doubts he'll ever see much money. He says he's grateful that even at the end of the summer, business is picking up.

Yet, he says, it's all fragile. One threatening statement from Hezbollah leader Hassan Nasrallah, and he fears his orchard will be deserted again.

Nira Aharoni(ph) and her husband came here with two other couples from Holon, near Tel Aviv, to enjoy the green forests and the quiet after the tension of the month-long war. She says it was a last-minute decision to come.

Ms. NIRA AHARONI (Israel): In the war I didn't think about going. My son is working in Haifa, and I was so worried. So I didn't have any patience to go nowhere, only to stay and hear from him. Now, after the war, I am quiet, and I can afford myself to do whatever I like to.

GRADSTEIN: Northern Israel, with its forests, cool air, and hundreds of bed and breakfasts, has always been a popular vacation spot for Israelis in the hot summer. But the war hit the tourism sector especially hard. Visitors from outside Israel were down 25 percent in July, and the figure is expected to be even higher in August.

Hundreds of small businesses like Levy's orchard are on the verge of collapse. Others have taken hits, but feel confident they will survive.

Mitch and Suzy Pilcer run a bed and breakfast in the town of Tzipori, near Nazareth. When we spoke to them earlier this summer, their cottages were empty.

Mr. MITCH PILCER (Owner, Bed and Breakfast): We're not, you know, a huge business. It's a mom and pop family-run bed and breakfast with only five cottages. You know, during this time of year, I mean, we'd be taking, you know, a minimum, you know, between five, six, seven hundred dollars a day, which is gone. So, you know, you time it by a month, that comes out to be our losses.

GRADSTEIN: But his wife, Suzy, says for the last week of August, they're full. And she's thrilled.

Ms. SUZY PILCER (Owner, Bed and Breakfast): The place became alive again. It's excellent. It's - it makes the whole place happy to see people again. That's what it was built for. That's what we wanted. That's what we wanted people to come and enjoy. They're back. I'm so glad.

GRADSTEIN: Some tourists come north out of curiosity. On the road along the border with Lebanon, you can see families of Israelis posing for pictures with soldiers and tanks. One enterprising tour guide is even offering Katyusha tours stopping at heavily damaged sites.

Other Israelis come out of solidarity. One stationery store owner in the battered town of Kiryat Shemona says dozens of Israelis have driven three hours north to buy their school supplies for the coming year in the border town.

The total cost of the war has still not been calculated. The original estimate was about half a billion dollars. That has since been raised to $1.3 billion. Israeli Prime Minister Ehud Olmert has promised to pump millions of dollars into northern Israel, and the government is launching a new campaign to encourage tourism.

But with defense expenditures rising dramatically, it's hard to see where the money for the revival of the north will come from.

Linda Gradstein, NPR News, northern Israel.

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