Bankers in Israel
The economic and current crisis in the construction industry
We are honored to address you on behalf of the Arab Economic Forum and the Arab Community Economic Emergency Headquarters with the following words:
1. Before we get to the heart of the matter, a few words about the Arab Economic Forum (AR) – The Arab Economic Forum is an independent, non-profit research institute, one of the leading institutions in Israel, which conducts applied studies. and social and economic policy studies related to the Arab community in Israel, among other things, with the aim of making this information and studies available to policymakers and decision makers in the country.
The Arab Economic Forum is currently establishing, under the umbrella of the Supreme Oversight Committee for the Arab Community in Israel, along with other economic and legal organizations from the third sector, an economic emergency headquarters for the Arab community that provides basic legal and economic information. ; and runs an advisory forum for companies from the Arab community that were or are expected to be affected by the war and in light of the difficult period the country is going through as a result.
2. Regarding the content of our appeal – As we know, on 08.10.2023, Government Resolution No. 941 was passed, in which a special situation was declared on the home front in accordance with the government’s authority in Section 9C(b)(3) of the Civil Defense Law, 571-1951 (hereinafter and above: “War”). One of the business sectors in the economy that has been severely affected by this war is the construction sector – a sector that is a source of income for thousands (if not hundreds of thousands) of households in the country. As we know, the construction industry (and infrastructure) is an industry that generates economic growth and is an industry necessary for a healthy economy (and a country in general); Its influence extends beyond the construction industry itself and its markets, directly or indirectly, to all economic branches in the country, including: the banking system that invests, directly or indirectly, in real estate projects – either as a lending bank, mortgage providers, commercial lenders, construction contractors, and the financial leverage of entrepreneurial contractors, so that the continuity, growth and success of the construction industry (and at the very least – its non-interference with financial and cash flow difficulties) are of utmost importance to the banks.
3. According to official data for this period, the construction industry, if it does not receive support and assistance – including with regard to: the workforce in light of the closure of the territories to the entry of Palestinian workers; and the lack of cash flow due to the cessation of work in most construction sites in the country (especially in the center, and regardless of the legality of those decisions issued by the local authorities that closed construction sites), is approaching one of the biggest crises ever
4. Saving the industry cannot come from government sources alone; Especially in light of the criteria set for receiving aid from the newly established State Guarantee Fund for emergencies – the criteria set by
The state for receiving aid from this emergency fund, limited assistance to companies located up to 80 kilometers from the Gaza Strip, and this does not take into account companies operating in the construction and infrastructure sector, most of which are far from the same specific road, mainly in the north of the country, but carry out work within or near this road, all without reasonable justification or clear guiding logic.
5. In light of the above, and at this difficult time, we appeal to you to move in the space that is still empty; we ask you to work to make credit solutions available and to shed light on a large part of the economy that is neglected these days, which is the construction and infrastructure sector
6. Unfortunately, the banks’ privileges also did not include contractors whose construction sites were closed and who today have to deal with paying expenses and resolving the unreasonable credit crisis without the support of the banks.
7. We appeal to your Excellency, with appreciation and understanding, that the banking system is closest to each of the aforementioned contractors and the consequences of the collapse of the contractors on hundreds of thousands of families who live off of In addition, we demand that the Fund’s loan path be expanded to include the entire country to support businesses in the Arab community.
8. Unfortunately, instead of supporting the industry at this time, the industry has been declared by most banks as a protective industry, which will cause the economic collapse of many companies in the economy and tarnish the reputation of hundreds of thousands of families in the country.
9. We are at your disposal for any questions or clarifications.
Sincerely,
Dr. Sami Miari
Omar Bandi, CPA
Professional Section
Arab Economic Forum (AR)
Economic Emergency Headquarters for the Arab Community
Copy
Supervisor of Banks Bank of Israel
מכתב למנהלי בנקים 01.11.2023
