Israel Plans ‘Economic Safety Net’ for Workers, Businesses Harmed by COVID

PM Netanyahu and Finance Minister Katz meeting with Self-Employed and Business Owners. Photo courtesy of Amos Ben-Gershom (Israeli GPO).

As coronavirus cases are rising in Israel and restrictions are being renewed, the Jewish State is redoubling efforts to try and mitigate the financial trauma caused by the shutdowns due to COVID-19. Israeli Prime Minister Benjamin Netanyahu has announced an “economic safety net”—including funds set to be distributed this week to self-employed and business-owners and another economic plan primed for “a lightning legislative process.”

The approach comes as The Times of Israel reported that Israel’s unemployment rate has hit 21 percent and growing. It is actually slightly improved from earlier during the coronavirus crisis, when more than a million Israelis were unemployed. Netanyahu, speaking in Sunday’s cabinet meetings in comments released by his office, said he is listening to the pain of the people.

“I must say that on Friday, I again met with business owners and company representatives and I heard their needs and the problems that have arisen in the field, especially their concern that there will be so many elements and people that will fall between the cracks,” said Netanyahu.

“…Together with you, I intend to [have] maximum cooperation. This is what we need at the moment, for all of us to work to support this important plan.”

The multi-faceted economic plan—some of which still needs to be passed into law by the Knesset (Israeli parliament)—includes an “immediate advance” of funds to the self-employed and controlling-shareholders in businesses, an extension until June 2021 of unemployment compensation and other benefits, and financial grants to small and medium-size businesses ranging up to half a million shekels (roughly $145,000) every two months.

“Let it be clear—the assistance funds depend on the extent to which the business was hurt,” said Netanyahu on Thursday last week in comments released by his office. Additional steps and plans could also be on the table, “if necessary.”

While the Israeli government is making efforts to try and address both the health and economic risks of coronavirus at the same time, the challenge has been evident. With cases of the virus rising again in the country, the economic struggles inspired 10,000 people in Tel Aviv to protest the government’s approach on Saturday, according to The Times of Israel. This was after Netanyahu announced the above plan earlier last week.

Last Thursday, before the protest, Netanyahu sounded cautious but committed. “I do not want to give you the illusion that this will solve every problem but I can assure you that I personally will be constantly involved to see to it that the money goes to you, that you will be able to maintain yourselves and your families in this difficult period.”

Israel actually finds itself able to prop up the economy because of their economic success in the past, according to Netanyahu. “We can do this and invest this huge amount of money because the Israeli economy is very strong. It has garnered quite a reputation; we enacted many reforms here,” said Netanyahu. “We have brought unique growth, I am very proud of this, but it gives us the ability to borrow money at very low interest.”

The challenge is steep, but Netanyahu still sounded hopeful on Sunday. “We can overcome the coronavirus or at least bring Israel to an economic and health routine that enables us to live in a reasonable manner in the coming year. This is the goal; this is the first step.”

(By Joshua Spurlock,, July 12, 2020)

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