South's industry suffers NIS 650m. damage since Gaza op

"About 50 percent of the workers in Sderot and the Gaza periphery are not coming to work and 20% of employees working further away are staying home."

By SHARON WROBEL
January 7, 2009 11:00
2 minute read.
South's industry suffers NIS 650m. damage since Gaza op

Ehud Olmert meeting 88 248. (photo credit: GPO)

 
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The first 10 days of Operation Cast Lead has cost businesses in the South NIS 650 million, according to the Federation of Israeli Economic Organizations. "Since the start of the operation, the business sector has suffered a total loss of NIS 650m. as a result of lost sales, absence of employees at the work place and suspended production during rocket attacks," federation chairman Shraga Brosh said at a solidarity conference at the Osem factory in Sderot on Tuesday. "About 50 percent of the workers in Sderot and the Gaza periphery are not coming to work and 20% of employees working further away are also staying at home." Within 40 kilometers of Gaza, 22,000 businesses employ 160,000 workers. The trade and services sector in the South lost an estimated NIS 160m. in the eight work days since the fighting began on December 27, the Federation of Israeli Chambers of Commerce said on Tuesday. The FICC added that the 15,000 businesses in the sector in the South employ 350,000 people. The conference in Sderot was attended by Prime Minister Ehud Olmert, Finance Minister Ronnie Bar-On, Histadrut Labor Federation chairman Ofer Eini, Israel Hotel Association President Eli Gonen and Israel Self-Employed Association President Yehuda Talmon. Brosh urged Bar-On and Olmert to formulate a compensation package in cooperation with employers and the Histadrut based on that used in the North in 2006. "We need to 'copy and paste' the terms of the compensation mechanism applied during Second Lebanon War, for businesses in the South," Brosh said. "The cost of the compensation package totaled NIS 3 billion, but no employee was fired and no business collapsed, and economic growth in 2006 continued as if the war had not happened." Over the past few days, the Finance Ministry forged an agreement with the Manufacturers Association and the Histadrut on compensation for workers in war-affected companies, but failed to come to an understanding on a compensation mechanism for businesses and factories. In light of the economic slowdown over recent months resulting from the global crisis, the ministry argues that a fair compensation policy would need to differentiate between the impact of the economic slowdown on businesses revenues and the fighting's. At the conference, Bar-On said the estimate of NIS 650m. in losses suffered by the business sector seemed far from reality. Furthermore, Bar-On unveiled a program for state-guaranteed loans to small businesses in the South with annual sales of up to NIS 2.5m. The program, which is expected to be announced at the beginning of next week, aims to provide an immediate answer to the growing credit needs of war-affected businesses, to save them from collapse. The Betili furniture chain, which operates 14 branches across the country, announced on Monday that it is proposing to small businesses from the South such as clothing and electronic shops to sell their goods at specially allocated spaces within their branches without any charge. Customers of the Betili chain will be invited to buy goods from the South to help businesses that have been hurt by the fighting.

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