The governor of the Bank of Israel has warned Benjamin Netanyahu that his new government’s proposals for sweeping judicial reform could harm the country’s economy, according to Israeli media.
Professor Amir Yaron met with the Israeli prime minister on Tuesday, according to the Yedioth Ahronoth newspaper, after asking for an “urgent meeting”.
Yaron reportedly raised concerns shared by other participants at last week’s World Economic Forum summit in Davos that overhauling Israel’s judicial system would erase democratic checks and balances, which could lead to a decision to lower the country’s credit rating and scare away foreign investment. Much of the country’s high-tech sector – which, at 15.3% of GDP, is the main driver of economic growth – is financed by outside investors.
The governor’s reported intervention comes after a public rebuke of the government’s plans by two of his predecessors earlier this week, and a strike by several hundred tech workers in Tel Aviv’s “Silicon Wadi” on Tuesday morning .
An official statement released after the Knesset meeting said: “The Governor of the Bank of Israel reviewed the state of the Israeli economy and the challenges it faces, both locally and globally. an international point of view.
Netanyahu returned to power in December leading the most right-wing government in Israel’s history: various elements of the coalition want to annex the occupied West Bank, roll back pro-LGBTQ+ legislation, limit free speech and give the Knesset the power to overturn decisions of the Supreme Court.
Critics say the latter point would help Netanyahu escape conviction in his ongoing corruption trial, in which he denies all charges, and would fundamentally undermine democratic standards and civil liberties in a country without a formal constitution.
“Investors aren’t just thinking about tomorrow, they’re looking at the next decade. They do a risk analysis: the shareholders ask me: “What is plan B? Should we withdraw our funds from the country? “Investors need to trust that governments and countries will behave like democracies,” said Eynat Guez, CEO and co-founder of Papaya Global, a unicorn startup developing workforce management software.
“The feeling in our industry is that politicians like to use us as the face of the country when it suits them. So if they want to use us as poster boys, now they have to listen to our voices too.
Tuesday’s hour-long hi-tech strike at one point blocked traffic on a busy thoroughfare in central Tel Aviv, as workers demonstrated holding signs reading ‘No hi-tech , no taxes”.
It follows large protests in cities across the country over the past few weekends that have succeeded in uniting people of different religious beliefs, ethnic backgrounds, incomes and political leanings in what is generally a highly polarized.
Guy Tytunovich, CEO and Founder of CHEQ, a cybersecurity unicorn, said: “I am worried both as a citizen and as a CEO about democracy, but Tuesday’s strike and other actions are proof that there are ways for us to combat this.
“There is optimism that the government will have to listen to…I am ready to invest time and money in this cause because no one wants our country to turn into Turkey or Hungary.”
Judicial reforms must pass three plenum votes in the Knesset to become law. Israel’s Channel 12 reported on Tuesday that the coalition has made overhauling the judiciary a top priority and hopes to pass the bill in early April.