'Israel's economy won't recover for another 4-5 years'

Expert gives gloomy prediction on Israel's ongoing recession, says economy will need 4-5 years to recover."

Arutz Sheva Staff ,

Keren Marziano
Keren Marziano

The Israeli economy will take at least four years to recover from the ongoing recession sparked by the government restrictions imposed to combat the coronavirus pandemic, and could take as long as five years, an expert warned Sunday.

Speaking with Radio 103FM Sunday, Keren Marziano, Channel 12’s economics and finance editor, gave a dreary forecast for the Israeli economy over the next few years.

In her forecast for the economy for the years 2020-2023, Marziano said there are two possible scenarios: first, the Israeli economy may gradually recover, or, in the second scenario, the economy could get even worse than it currently is.

Marziano said two factors will determine which scenario occurs: the future of the coronavirus, and government handling of the crisis.

“According to the estimates, it will take us four to five years for the economy to recover,” said Marziano.

Israel’s unemployment rate, which was just under 4% prior to the coronavirus pandemic in February, is currently at 21.6% - down from the record high of over 26% at the peak of the crisis, but still higher than ever recorded prior to 2020.

Marziano excoriated the government over the ongoing failure to secure passage of the state budget.

“Taking the economy into yet another period of uncertainty when we don’t have an approved spending plan in the midst of an unprecedented recession is ridiculous. Even a medium-sized business wouldn’t be able to function that way.”

The Likud has pushed for the passage of a less comprehensive, single-year spending plan, while Blue and White is demanding the Likud honor its coalition agreement to pass a two-year budget. Unless the Knesset votes to push back the deadline, the government must pass a spending plan by the 15th of August.