Business Scene

Russian oligarchs have responded to a Chabad initiative to explore investment possibilities in Ashkelon.

By
January 13, 2009 11:20
4 minute read.
Business Scene

ashkelon flat hit 248.88. (photo credit: AP)

PUBLISHED IN many European media outlets as well as in the Hebrew press, The New York Times story about Sonja Kohn, "Austria's Woman on Wall Street," makes for fascinating reading. A haredi associate of Bernard Madoff, Kohn, according to the story, succeeded in gathering millions for him from wealthy investors in Russia, Europe and Israel. She has now apparently gone underground for fear of reprisals from Russian oligarchs whose money represented a considerable chunk of the $2.1 billion that Bank Medici, the bank founded by the bewigged, multilingual Kohn, invested with Madoff. The Vienna-headquartered bank has now been taken over by Austrian regulators. Other stories about Kohn have appeared in numerous other publications, on wire services and on CNN International. Small wonder that Kohn and her husband, Erwin, have had to do a disappearing act. ALTHOUGH RUSSIA, like the rest of the world, is experiencing an economic meltdown, some oligarchs are still doing well. They have responded to a Chabad initiative to explore investment possibilities in Ashkelon, which like other parts of the South, is hurting badly business-wise because of the security situation. HOTELS IN Eilat had been anticipating a major increase in incoming tourism for fall/winter 2009, but the military operation in the Gaza Strip put an end to such hopes. Instead of tripling the number of flights landing in Eilat during the season, the security situation has affected the ability of overseas tour operators to fill the planes. Most flights coming into Eilat from abroad are now half empty, and hotel occupancies stand at somewhere between 30 percent to 40%. As a result, hotels have been forced to introduce a four-day work week rather than lay off staff. Although the mid-December fatal bus crash, in which 25 Russian travel agents on a tour of Eilat were killed, did not have a significant impact on tourism, a Russian travel advisory against visiting any part of Israel during Operation Cast Lead has resulted in a major downturn in tourism from Russia, including Jerusalem. Rafi Sadeh, the president of the Eilat Hotel Association, together with Shabtai Shai, the director-general of the EHA, have left for London to try to convince tour operators there to continue the long British tradition of following the sun to Eilat in winter. AT THE initiative of Negev and Galilee Development Minister Ya'acov Edri, some 200 merchants from the South gathered in Hangar 11 at the Tel Aviv Port on Sunday and Monday. They were trying to recoup some of the losses they have incurred because people in their towns and cities have been too frightened to shop for anything other than absolute necessities. Although some merchants reported that they were more than satisfied with the results, others complained that visitors to their stands were just looking rather than buying. Tel Aviv Mayor Ron Huldai posed for a photo while holding up a T-shirt with a Sderot logo, but how much shopping he did is another story. On Tuesday and Wednesday, the southern merchants will take their wares to the Ramat Gan Diamond Exchange. Malls in Jerusalem have also hosted merchants from the South. According to Edri, if the conflict continues for much longer, the merchants from the South will go to other parts of the country as well. IN CONJUNCTION with Yediot Aharonot, Army Radio and the Soldiers Welfare Association, Supersol is conducting a campaign to send "Whole Hearted" care packages to soldiers. Snacks, candies, cookies, chocolates and other nonperishables in a list of some 300 items included in the campaign are being sold at 50% discount. While no one would doubt that Nochi Dankner, who heads IDB, which has the controlling interest in Supersol, is a generous philanthropist who gives to many causes, there is still something too business oriented in the campaign. Anyone visiting a Supersol branch will notice that Supersol is simultaneously conducting a campaign for customers to use its credit card, which enables them to enjoy enormous discounts, often far in excess of 50%. This would indicate that regardless of what it charges, Supersol is still making a profit. Supersol often has its checkout clerks ask customers if they're willing to contribute to one charitable cause or another, and most customers don't mind giving a few shekels or are otherwise too embarrassed to refuse. The aggregate of these few shekels comes to a large sum, which then becomes a Supersol donation, with none of the individual donors, ie. the customers, receiving any credit. This particular campaign doesn't quite work that way. It is much more aggressive. The minute a customer enters one of the stores in the chain, he or she is assailed by a team of volunteers in white sweatshirts bearing the red logo of the campaign. One of the volunteers thrusts a flier into the customer's hand to indicate the choice of products, and this person or another member of the group then follows the customer around the store, which for some people, especially pensioners, is very disconcerting. Loudspeaker announcements about the campaign are much more frequent than rockets from Gaza. The volunteers, in addition to patrolling the store, also crowd around the checkout counters to persuade customers to include goodies for the soldiers in their purchases. As it happens, several of the manufacturers of products on the list are already sending crates - either free of charge or at some symbolic price - to the soldiers and to civilians in areas that are being targeted by terrorist rockets. The campaign would be a lot more kosher if Supersol had taken a guideline from the politicians by suspending competition for the duration and getting together with its rivals for a joint campaign for the common good. If every supermarket in the country was participating, there would be no suspicion that this is yet another way of boosting sales and profits.


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