Bank Hapoalim President Reuven Krupik spoke at the opening ceremony of the Globes Israel business conference last night, where he shared his view on what is happening in the Israeli economy and how it can be put on a sound growth path in the near future.
“This is my opportunity to share with you some thoughts about some economic and social principles that cannot necessarily be measured,” Krupic said at the opening of these statements.
“The state of the economy may be more complex than it appears, but focusing on dealing with some of the fundamental problems will lead the economy to healthy growth. In my conversations with my colleagues and friends, it became clear that there is a tension: a tension between powerful forces.” The appearance of the economy today, and unfavorable economic metrics, such as the debt-to-GDP ratio, the fiscal deficit, and the recent credit rating downgrade.
“We generally tend to study economic conditions using typical models or on the basis of past experiences, while the reality that is taking shape today is different.”
“Extreme scenarios”
“Financial institutions like us are obligated to conduct tests for extreme scenarios. But extreme scenarios are not designed, and are not able, to take into account social factors, such as the consequences of the strength of the democratic process on economic growth, and the large movement in the balance of migration and economic policy that “Stimulate growth.” “Social and political developments would create a chain of events and cause the economy to deviate from the scenario.”
“Israel is at a turning point”
Regarding geopolitical developments, Krupic said: “With the ceasefire agreement in the north, which gives me hope that a future agreement will be reached in the southern sector as well and the necessary agreement to return our hostages, it seems that Israel has reached a turning point.
“These are some of the most complex and important times that Israel’s leaders and society have faced. At this critical juncture, we need to rethink the economic metrics and principles that we have in the past taken for granted. These times call for caution in making decisions that can make the greatest advantage to the point we find… ourselves in which it is possible to isolate and identify the main issues that need to be dealt with.
The head of Bank Hapoalim identified two main issues. “First of all, the discrimination in the distribution of the burden among the population. This is a prominent element, and it must be fixed. I am not just talking about obvious examples, such as the failure to recruit entire sectors of the population into the army.
“It also applies to differential participation in the labor force, encouraging state support as a substitute for income from work, or giving low priority to efforts to close social gaps.”
Another issue Krupik mentioned is the way decisions are made. “Reliance on unilateral legislation without examination or consensus, selective fiscal policy, preferential treatment of certain sectors, and politically oriented budget prioritization – all of these will move us away from the growth and welfare goals that these loyal people deserve.
“These issues make the chances of economic recovery much lower. As long as they are not addressed, they will mean a greater burden on families to finance rehabilitation programmes. These complexities can be dealt with. They can be repaired and rebalanced.” In ways and using tools, most of which have been successfully employed in economic crises in the past.”
“The divisive message is twice as weak.”
Krupic’s message was clear and unambiguous: “We need a profound reform of society and the economy, a reform that will make possible optimistic and constructive long-term planning. The first step in this reform is the restoration of open and non-adversarial relations.” Divisive rhetoric in public debate only multiplies weakness and, worse, means a loss of ideas.
Krubik concluded his speech by saying that to the beginning of the process of ending the fighting and restoring calm, “the process of restoring rational thinking and striving for unity must be added.”
The Globes Business Conference in Israel is held in cooperation with Bank Hapoalim and Phoenix Holdings, and is sponsored by El Al, Bezeq, Nespresso, Walt, Dell, the Israel Medical Association, Energean, the Jewish National Fund, BlackRock, Playtica, Meta, Strauss Group, Bazin Group, Inc. MSCI, with the participation of Mekorot, the Port of Ashdod, and the Israel Innovation Authority.
Published by Globes, Israel Business News – en.globes.co.il – on December 3, 2024.
© Copyright Globes Publisher Itonut (1983) Ltd., 2024.