Israel: Money is leaving the country 10 times faster than usual

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Israeli bank chiefs have warned Finance Minister Bezalel Smotrich that money is leaving the country at a rate 10 times faster than usual, on the back of investors’ fears of a government plan to overhaul the justice system.

This came, during a meeting in Smotrich’s office, on Tuesday evening.

During the meeting, the heads of the banks warned the Israeli Finance Minister that the judicial reform plan was harming the economy, saying that “money is leaving Israel at a rate ten times the usual rate,” and called for stopping legislation for the plan.

Yedioth Ahronoth newspaper described the meeting as tense one, as the directors the banks in Israel warned unanimously, in clear and sharp language, of the great damage that judicial reform could cause to the country, and to the good economy so far.

However, the Israeli Finance Minister denied that the government plan would harm the economy, and told the banks directors, “Your statements are what will lead to harm”.

Last month, the Governor of the Central Bank of Israel, Amir Yaron, told Prime Minister Benjamin Netanyahu that the world’s top economists and officials in credit rating companies had warned him that the government’s plan might push investors to flee Israel and cause a decline in Israel’s credit rating.

Israel is witnessing a state of severe polarization and severe division, between the government and its supporters from the far-right camp, and the Israeli opposition and its supporters on the left, against the background of the plan that the opposition describes as a judicial coup, and the government says that it aims to restore balance between the authorities.

On Monday, about 90,000 Israelis demonstrated in front of the Knesset building in western Jerusalem, in conjunction with the vote of the so-called Constitution Committee on the proposed amendments within the legal reform promoted by the government.

The vote resulted in changing the composition of the Judges Selection Committee and preventing the Supreme Court, which is the highest judicial authority in Israel from invalidating basic laws.

The new bill, which aims to change the composition of the Judges Selection Committee, to be under the control of the coalition, was passed by a majority of 9 members in the coalition against 7 opposition members in the committee, and it is scheduled to be put to a vote later before the Knesset plenary of 120 deputies.

The proposed reform process would impose sweeping changes to the legal and judicial systems, almost completely eliminate the High Court of Justice’s authority for judicial review of government decisions, and give the government an automatic majority in the judges’ selection committee.

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