Finance officials have warned about the economic consequences of a legal reform, prompting Minister of Finance Bezalel Smotrich and MK Simcha Rotman, Chairman of the Constitution Committee, to hold a press conference at the Knesset’s Jerusalem Hall. The reserve forum has also intensified their struggle in opposition to the reform. Smotrich maintained that Israel needs a real reform to strengthen the Jewish and democratic state, which has received a mandate from the public. The national camp has gone to the polls several times before but felt their voice was ignored. The crisis of confidence in the court is dangerous for Israeli democracy. There has been a severe warning document about the economic consequences of the legal reform, which may cause negative consequences on investment in the country. The expectation of credits rating downgrade is enough to create a negative impact on investment in the country’s economy. Hence, the changes proposed in the legal system may weaken the state’s institutions, compromising its credit rating companies.
After the warning of finance officials about the economic consequences of the legal reform: Minister of Finance, Chairman of Religious Zionism, Bezalel Smotrich, and Chairman of the Constitution Committee, MK Simcha Rotman, are holding a press conference this evening (Tuesday) in the Jerusalem Hall of the Knesset. Join the live broadcast:
The reserve forum intensifies the struggle: “If the reform is completed, we will not enlist in the reserves”
Smotrich began by saying: “The State of Israel needs a real reform. Years of practice and learning and activity and the formation of an orderly democratic conceptual concept require the real strengthening of a Jewish and democratic state. We received a clear democratic mandate from the public to lead the reform and we are committed.”
“Until now, the national camp has gone to the polls time and time again, but felt that its voice was being hidden, that the policies it believed in were being denied. A democratic country must have a strong judicial system that is widely trusted. The crisis of confidence in the court is dangerous for Israeli democracy, it has caused large audiences who do not have the right to choose and sterilizes their choice democratic and their freedom”.
As you may recall, last night senior officials in the Ministry of Finance presented Smotrich with a severe warning document about the economic consequences of the legal reform. In the senior officials’ discussion with the Minister of Finance, Israel’s macro data were presented and the possible risks and opportunities of the reform and the protest against it were noted. According to the document, in the event that the credit rating is downgraded as a result of the legal reform legislation, the economy is expected to lose between 15 and 30 billion shekels per year.
The warning document refers to the publication of the credit rating companies Moody’s and Fitch, which warned about the possible consequences of the legislative procedure on Israel’s credit rating and economic situation. “The reference of the rating companies is of great significance since their professional assessment provides investors with information about the inherent risks and opportunities.
Even without a credit rating downgrade, the expectations of its downgrade are enough to cause negative consequences on the level of investment in the country already in the immediate time frame. The publication of an abnormal review that is not fully qualified, as done by Moody’s, signals to investors that the state of the economy requires consideration and creates negative expectations regarding the viability of investing in the country.”
“As of this time, it is evident that the proposed changes in the legal system are perceived by the relevant international bodies as those that may weaken the state’s institutions. The strength of the institutions is a major consideration in determining the credit rating of Israel and of Israeli companies. Therefore, to the extent that the credit rating companies do It will be understood that the legislative measures will weaken the institutions, their approval may lead to a downgrade, for all the economic implications involved as discussed above,” the document emphasized.