In 1948, the year Israel was founded, the Mer Group was established as a metal workshop.

Today it’s a much different company. It operates a dozen subsidiaries and employs 1,200 people in over 40 countries, selling wireless infrastructure, software for public transit ticketing systems, wastewater treatment, and more. But at the ISDEF Expo, an event held last June to show off Israeli technology to potential buyers from foreign security forces, the Mer Group’s representatives were only promoting one thing: surveillance products sold by the company’s security division.

The Mer Group’s evolution from cutting metal to electronic snooping reflects a larger shift in the Israeli economy. Technology is one of the main sectors in Israeli industry. And Israeli firms with ties to intelligence, like the Mer Group, are using their expertise to market themselves internationally. The company’s CEO, Nir Lempert, is a 22-year veteran of Unit 8200, the Israeli intelligence unit often compared to the National Security Agency, and is chairman of the unit’s alumni association. The Mer Group’s ties to Unit 8200 are hardly unique in Israel, where the cyber sector has become an integral aspect of the Israeli economy, exporting $6 billion worth of products and services in 2014.

When drafted into the army, Israel’s smartest youth are steered toward the intelligence unit and taught how to spy, hack, and create offensive cyberweapons. Unit 8200 and the National Security Agency reportedly developed the cyberweapon that attacked Iranian computers running the country’s nuclear program, and Unit 8200 engages in mass surveillance in the occupied Palestinian territories, according to veterans of the military intelligence branch.

Increasingly, the skills developed by spying and waging cyberwarfare don’t stay in the military. Unit 8200 is a feeder school to the private surveillance industry in Israel, the self-proclaimed “startup nation” — and the products those intelligence veterans create are sold to governments around the world to spy on people. While the companies that Unit 8200 veterans run say their technologies are essential to keeping people safe, privacy advocates warn their products undermine civil liberties.

In August, Privacy International, a watchdog group that investigates government surveillance, released a report on the global surveillance industry. The group identified 27 Israeli surveillance companies — the highest number per capita of any country in the world. (The United States leads the world in sheer number of surveillance companies: 122.) Unit 8200 veterans either founded or occupy high-level positions in at least eight of the Israeli surveillance companies named by Privacy International, according to publicly available information. And that list doesn’t include companies like Narus, which was founded by Israeli veterans of Unit 8200 but is now owned by Boeing, the American defense contractor. (Privacy International categorized Narus as an American company because it’s headquartered in California.) Narus technology helped AT&T collect internet traffic and billions of emails and forward that information to the National Security Agency, according to reporting in Wired magazine and documents from the Snowden archive.

“It is alarming that surveillance capabilities developed in some of the world’s most advanced spying agencies are being packaged and exported around the world for profit,” said Edin Omanovic, a research officer at Privacy International. “The proliferation of such intrusive surveillance capabilities is extremely dangerous and poses a real and fundamental threat to human rights and democratization.”

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