Stanley Fischer at press conference in Jerusalem_311.
(photo credit: Reuters)
While Israel's economy has weathered the global economic downturn relatively well, a financial crisis in Europe would present a difficult challenge, Bank of Israel Governor Stanley Fischer said Wednesday.
Speaking at the 12th annual Herzliya Conference, Fisher said: "In the short term, we have a strong, steady economy."
"If there will be a large financial crisis in Europe," he warned, "we will need to be creative and strong and in my eyes we will be able to weather it."
Fischer also said the negative global growth forecasts from the International Monetary Fund are worrying. "Israel is very affected by this, and we do not know what the influence will be because we cannot predict if there will be a decline in output or a financial crisis."
Looking to Israel's labor market, Fischer warned that the quick growth and low employment rate among the haredi (ultra-Orthodox) population is not sustainable.
"In 30 years, the haredi percentage of the population in Israel grew significantly. The majority of that population does not work. I value religion, but this situation...cannot continue," he said.
Fischer added that more would have to be done to help Arab Israelis - who have begun to "develop their businesses and enter the workforce" on their own - further integrate into the workforce.