Minister of Finance Benjamin Netanyahu told the Knesset Finance Committee today that he was beginning practical preparations for construction of a casino in Eilat. Preparations include both planning the project and preparing accompanying legislation.
Netanyahu disclosed the casino plan during a review of the state of the economy at the opening of the Knesset’s summer session. He said that investments had totaled an annualized $5 billion in the first quarter, 40% more than the high of $2.9 billion in 2000.
Netanyahu pointed out that the sum included the acquisition of Bezeq (TASE: BZEQ) and quite a few other non-stock exchange investments.
”The Israeli economy is considered an overall success a dynamic, open, growing, and regenerating economy,” Netanyahu declared. He attributed the positive results, including continuing growth and falling unemployment, to his advanced policy of cutting taxes and instituting reforms. He said that growth was reflected in higher consumption and investment. Reforms include restructuring of the Israel Land Administration, on which agreement was reached this morning at the Prime Minister’s Office, and streamlining of planning and building committees. Netanyahu said he was concentrating on these committees with a team of ministers, including the Minister of the Interior.
”We’re working fulltime to boost growth and reduce unemployment; that’s all that matters,” Netanyahu stated. He stressed the next targets for bolstering competition: sale of the controlling interest in Bank Leumi (TASE: LUMI), opening the ports, and legislation, to be submitted to the Knesset soon, separating the provident funds from the banks.
”You saved the Israeli economy; that’s indisputable,” MK Avshalom Vilan (Yahad) unexpectedly complimented Netanyahu, but immediately added that the price had been “destruction of Israeli society.”
Vilan added that the drop in the number of terrorist attacks was a bigger factor in the improvement to which Netanyahu had referred. “Cutting company taxes is important, but it would have been better to cut the VAT rate,” he commented.
MK Avraham Shochat (Labor) also welcomed improvement, but demanded greater social balances.
Netanyahu answered that economic and social policy could not be included in the same package. He further asserted that a plague of allowances had increased social inequality. He claimed that in the process of rescuing the economy from its critical state, “The worst is behind us. Today, I’m more sympathetic to social complaints, but the way to escape the social dilemma is not to follow the road that put us there. We must separate those who can work from those who can’t. We’ve recently invested billions in those incapable of working. The problem is still those Israelis who find it difficult to go to work, even though they’re capable of it.”
In answer to a question, Netanyahu added that he would insist that disengagement expenses not breach the budget framework, and would not exceed NIS 2.2 billion. He said that the same amount would be budgeted for 2006.
Published by Globes [online] - www.globes.co.il - on May 16, 2005