Economy minister touts progress in fight against bureaucracy

Chambers of Commerce issue warning on state-owned monopolies.

Economy Minister Naftali Bennett (photo credit: REUTERS)
Economy Minister Naftali Bennett
(photo credit: REUTERS)
Economy Minister Naftali Bennett touted progress in cutting regulation and red tape, saying that reducing regulation was vital for Israel’s economic growth.
“Israel is open for business,” he said at the Federation of Israeli Chambers of Commerce’s annual event on Monday. “See me as the ambassador in the government for stopping regulation and helping the business sector, which is the backbone of the State of Israel.”
The economy minister has authority to install protectionist import tariffs in some industries, he said – authority he let lie dormant since taking office as old tariffs expired.
The ministry had cut 10 percent of the official standards from the Standards Institute, he said. The regulations at the Standards Institute have long been a sore spot for Bennett, who likes to tell of the regulatory purgatory his wife had to go through when opening up her ice cream business as a result of the endless rules.
“A standard is an important thing when it’s designed to protect public safety, but we all know that over time unclear standards were issued and that they were only slightly different from European standards, except that the difference isn’t related to safety or public safety,” he said. “The difference was created to prevent imports and to impose barriers so there will not be competition here.”
The Standards Institute, he said, had committed to entering 90 percent of its regulations into reciprocal agreements, so that products that live up to European or American standards can easily be imported to Israel.
Most new jobs, he continued, come from new businesses, which means Israel needs more entrepreneurs.
Israel’s rank in the World Bank’s annual Doing Business survey continued its steady drop in 2014, falling from 33rd place to 35th. Though there was continued backsliding in areas such as paying taxes, enforcing contracts, obtaining construction permits and registering land, one area that saw improvement was the ease of starting a business.
FICC President Uriel Lynn praised the government for its efforts to level the playing field in the market, but said it had not done enough to deal with the problems in its own backyard: state-controlled monopolies.
“We’ve seen great determination in the government [as it fights] market concentration in the private sector, but we don’t see the determination against the concentration in the absolute monopolies owned by the state, such as the [Israel] Electric Corporation,” he said.