Roi Cohen

Attorney Roi Cohen is the president of LAHAV, the Israel Chamber of Independent Organizations and Businesses

Israel's economic ship is heading toward an iceberg

Politicians must put other considerations aside and work together for the benefit of business owners and the economy as a whole, which is suffocating under unprecedented paralysis.

Amid the political ego battles, the Israeli economy is standing on the edge of a yawning precipice that is billions of shekels deep. The deficit is growing daily and nearly a year has passed without any proposed solution on how to handle it, let alone action. The country has never known a period like this one – paralysis that is harming every aspect of the market. In the face of this insufferable stagnation, I am calling on the leaders of the big parties to put aside political considerations and make peace for the sake of the economy's existential interest.

It is unfathomable that such important reforms to the market and the business sector that have already been approved by the Knesset have yet to be implemented: Amendment 34 to the Licensing of Businesses Law, which passed second and third readings in the Knesset in July 2018, for example. The reform established three expedited licensing channels, in addition to the standard business licensing process, that are adjusted to the level of complexity and risk faced by various forms of businesses. The various licensing routes were supposed to be laid out in detail as a codicil to the Business Licensing Order, but that is still waiting for a new government to be formed as well as a new Knesset Interior Committee in order to be approved.

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Another example is the law regulating payment deadlines, which was approved by the Knesset in a historic decision on March 20, 2017. The healthcare system was exempted from the law at the request of the Health Ministry, and senior ministry officials – including Deputy Minister Yakov Litzman – promised to deliver a framework for implementation within a few weeks. On May 15, 2018 the subject was raised in the Knesset Finance Committee for the last time. Then-committee chairman MK Eitan Cabel gave the Health Ministry a month and a half to submit regulations that would make it compliant with the law.

In that case, too, the Health Ministry opted to shut its eyes and use the excuse of waiting for a new government to be formed. We need not say that all this time, the ministry has been enjoying interest-free funding in the form of money from independent businesses owners, which it has 180 days (if not more) to pay back – which effectively crushes those businesses.

Even as we speak, the Budget Department of the Finance Ministry is working on basic guidelines for the next state budget, without having held a basic debate on economics. The country will find itself dragged into "auto-pilot," a situation in which the priorities that dictate the next budget will lead it into an even bigger economic crisis. We must not abandon the economy to policies comprised by temporary funding – emergency budges that eventually become the standard.

The Israeli economic ship is heading toward an iceberg. Public officials must ignore political considerations and demonstrate responsibility toward hundreds of thousands of business owners and the economy as a whole. They need to take action to establish a Knesset committee that will listen to the business sector and decide on what steps should be taken given the current situation, and take immediate action to start on the budget for 2020, with the unusual deficit being a top priority.

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