Prof. Trajtenberg hands recommendations to PM Netanyahu [file].
(photo credit: GPO)
Dairy and egg products will soon come under tighter supervision, and tenders
will be published for new public transportation companies and gas stations,
after the cabinet on Sunday unanimously passed the Trajtenberg Report’s
recommendations on competition.
This was the second of the report’s four
chapters to be approved by the cabinet, with housing and social services still
to come. The cabinet previously passed an amended version of the chapter on
taxation, segments of which have already passed the Knesset. The Trajtenberg
Report was commissioned by the government in response to this summer’s wave of
public protests over the cost of living.
“We are reducing the power of
the monopolies and the bureaucracy,” Prime Minister Binyamin Netanyahu said
Sunday. “Governmental bureaucracy is the largest of all, and this has also been
dealt with. We were a small and concentrated economy, the problem being that the
economy grew but remained concentrated in both the private and public sectors.
Approval of this chapter corrects imbalanced created over
Pending Knesset approval, the government will publish tenders
for the creation of new public transportation operators in a bid to reduce the
cost of travel. A national public transportation authority will be set up,
together with several regional authorities. Tenders will also be published for
the creation of 40 new gas stations, with all companies holding more than 10
percent of existing stations to be prohibited from the application
Committees will be established to supervise the price of dairy
and egg products and of gas for household consumption.
industry will be opened to outside competition in a bid to reduce the cost of
The powers of the Antitrust Authority, which is tasked with
regulating mergers and anti-cartel enforcement, will be strengthened. The
authority’s director-general will be given power to demand details of
manufacturing and sales calculations from large chains to ensure they do not
charge unreasonable prices.
The creation of new terminals at the Haifa
and Ashdod seaports will also be prioritized in a bid to decrease the costs of
importing and exporting.
Earlier Sunday, Bank of Israel Governor Stanley
Fischer said many other successful economies, such as Singapore, Hong Kong and
Belgium, suffer from over-concentration. However, that does not make it an ideal
situation for Israel, he said at the beginning of a three-day conference on
corporate governance and economic concentration at the Hebrew University of
Fischer applauded the recommendations made by the Trajtenberg
Report on the removal of importation barriers, which were included in the
chapter on taxation.
“Contrary to intuition, it is not always
economically correct to protect the local companies from exported competition,”
Although real income is high, Fischer said, the standard of
living here is still roughly two-thirds of that in the US.
“There is a
feeling that this is because of over-concentration,” he said, “but it is also
connected to agriculture, which is not over-concentrated but does benefit from