(photo credit: OLIVER WEIKEN/REUTERS)
The government will push forward with economic reforms that will “bring down the
cost of living,” Prime Minister Binyamin Netanyahu said on
Massive battles loom with the Histadrut labor federation and
others over the planned changes.
The cabinet discussed wide-ranging
reforms in the automobile sector to increase competition by opening the field to
more car importers and decreasing regulation on spare car parts, approving
legislation to overhaul the country’s car industry.
“We are committed to
bringing down the price of living in Israel,” the prime minister
said. “This government has made this a key goal, and will implement
He said the government would implement economic reforms “in the air,
sea and land – in every sphere.” The government would bring “great reform” to
the ports, he said.
Netanyahu called on his ministers to bring about
changes that would increase competition, improve services, increase
effectiveness and bring down the prices of goods and services. The goal was to
allow Israelis to buy goods and services at prices comparable to those abroad,
“The main reasons for the high price of living in Israel are the
monopolies and cartels that prevent competition and prevent a lowering of prices
to where they could be,” he said.
Netanyahu added that those who suffer
the most from the high price of goods and services were those in the lower
economic brackets, because the wealthy were “less sensitive to the prices of
basic goods and services.”
Transportation Minister Israel Katz said the
proposed reform would broaden the variety of cars on the market and lower
“I am convinced that implementing the reform, whose purpose is to
remove market failures and barriers to competition such as allowing small
importers that bring in 20 cars or fewer annually to operate.
there are only 15 vehicle importers that bring in 200,000 cars a year, half of
them from Japan and South Korea. The reforms would increase the variety of
vehicles allowed for import, including trucks and buses through parallel
importers and taxi cabs and other commercial vehicles through personal
Under the bill, leasing companies would be able to sell new
cars more easily and non-importers such as garages and car lots would be
permitted to sell new vehicles. Israel’s standards for spare part importation
would be set according to international standards, stripping them of special
requirements presently in place; and the approval process for importation would
Spare parts suppliers would have to publicize the stock and
prices of their parts in a public database.
Independent garages would be
allowed to compete with those associated with importers during a car’s warranty
Finally, addressing the used car market, the reform would require
greater disclosures for significant damage and allow buyers to appeal appraisals
The cabinet also approved on Sunday the establishment of a
ministerial committee on the cost of living, cartelization and encouraging
competitiveness in the economy, to be chaired by Economy and Trade Minister
After his appointment Bennett said that the government
was determined to “open up the Israeli market and lower prices.
those who say we are galloping too fast, but I say the opposite: We need to
gallop even faster and look at the upcoming year as a year of opportunity, a
year that will change the face of the country.”