Occupied Jerusalem- While the economic and commercial sector in the south and the “Greater Tel Aviv” region have begun to show signs of recovery and the possibility of emerging from the state of stagnation and paralysis in all areas as a result of the Israeli war on the Gaza Strip, the Upper Galilee region and the north of the country remain closed amid the worsening economic crisis.
Due to the escalation of tension between the Israeli army and Hezbollah on the Lebanese border, the economic and commercial situation in the region is expected to worsen, with the accumulation of losses for small and medium business owners, tourism branches, restaurants and cafes, and entertainment, in addition to the paralysis that has affected agriculture, poultry raising, and livestock.
More severe damage to property, infrastructure, roads, public buildings, residential buildings, and commercial and industrial centers is being added daily, as the tourism sector has been almost completely closed, while the various agricultural sectors are facing difficulty in operating under fire.
Losses and damages
According to a survey conducted by the Israeli Central Bureau of Statistics on the eve of the end of the third month of the war, the Israeli market showed signs of economic recovery in most regions of the country, with the exception of the Upper Galilee and the northern region bordering Lebanon.
The survey included a sample of 1,729 businesses that employ at least 5 employees.
According to the survey, the percentage of businesses that were closed or in a state of minimum employment – that is, employing up to 20% of their regular workforce – decreased to 10% in the southern region this December, compared to 59% at the end of October. Last October.
However, a similar recovery is not evident in the northern region and the Upper Galilee, where the corresponding figure in December reached 27%, unchanged compared to last November, and a slight decrease compared to the previous month of October.
The survey indicates that businesses reported a significant loss to their income of more than 50%. However, the Northern region stands out negatively with 39% of businesses reporting a loss to their income, compared to 42% in November and 64% in October. /October.
In the southern region, 32% of businesses reported damage to income, compared to 39% in November and 67% in October.
After 3 months of war, the Israeli Ministry of Finance is still unable to estimate the seriousness of the commercial and economic situation in the north, and the extent of the losses incurred by commercial interests and various economic branches and sectors.
Upon a request from the economic newspaper “The Marker” to obtain data on the damage caused by the escalation on the northern front, the Ministry of Finance responded that it did not have updated data regarding the damage such as the loss of gross domestic product, the rate of closed businesses and companies.
Commenting on the Ministry of Finance’s response, the head of the Union of Industrialists in Israel, Ron Tomer, said, “It is neither present nor absent from the paralysis that has struck the economy in the region. There are hundreds of owners of major factories in the Galilee asking for support and fortifying buildings so that employees can return to work.”
The newspaper quoted Tomer as saying: “Factories in the north and Upper Galilee are not accustomed to the situation. Some of them have areas that are not protected, and they are within range of missiles fired by Hezbollah. There is also still a risk of militant infiltration, so there are many cases of work stoppages in all branches.” And sectors.”
Economic and commercial bleeding
The marketing editor at The Marker newspaper says: Adi Dovrat that The problem of labor shortages in all sectors is prominent in the north, the Upper Galilee, and the border regions, because tens of thousands of residents of the region have been evacuated to distant places such as Jerusalem Or Tel Aviv.
She explained that the evacuated workers could not travel for 3 hours to reach their work, saying that the north was “bleeding economically and commercially without even having a comprehensive confrontation and without officially declaring a war with Hezbollah.”
According to data from the Israeli Ministry of Economy, the ministry has monitored 85 large factories in the north of the country and the Upper Galilee since the beginning of the war. Their average production has decreased by about 70%, and this decrease is due to the lack of workers and the fear of arriving in the region and working under fire.
Ministry data showed that there were also dozens of small factories closed due to their proximity to the border, and main roads and axes were closed for fear of Hezbollah missiles.
Regarding factories, industrial zones, and companies, it is evident from the Ministry’s data that since the “Al-Aqsa Flood,” nearly 15,000 businesses and factories have been evacuated in the north and south of the country.
Commenting on the issue, the economic advisor in the government incentives department, Efrat Newman, said, “The price is expected to be large and exorbitant. There is damage to citizens’ private property, as the event in the north is still far from over,” adding that the direct damage to the buildings cannot be estimated. Infrastructure, agriculture, etc.
The Chancellor did not rule out that if the security escalation continued, the direct damages would exceed one billion shekels (about 300 million dollars), and this amount does not include the losses incurred by the commercial and economic businesses of the various branches and sectors.
Compensation system
According to data from the Israeli Tax Authority, so far, 204,000 claims have been filed for compensation for indirect damages to commercial interests across the country during last October, and 167,000 of them have been paid, worth 3.7 billion shekels (more than a billion dollars).
The tax authority estimates that for the month of October alone, 8 billion shekels ($2.5 billion) will be paid, in compensation for indirect damages only. As for direct property damage, only NIS 600 million ($167 million) has been paid so far out of the billions that will be required to cover the losses.
According to the economic newspaper “Globus”, about 80% of the companies and commercial interests in the Galilee and Golan depend on tourism, and the interests, sectors and branches – which are not of a direct tourist nature, such as bed and breakfast places, hotels and tourist attractions – still depend for their income on local tourism and earn It makes a living from the tourists who come to the area.
The newspaper indicates that the vast majority of companies and commercial interests in the north and Upper Galilee are closed, and some of them are located in settlements that were evacuated by a government decision, and at this stage, all businesses and tourist attractions are closed, with the exception of some hotels and guest rooms that provide various services to displaced persons or soldiers.
The economic newspaper added that, according to a survey by the Israeli Ministry of Agriculture, most businesses in various agricultural branches in the north and Galilee have been disrupted, noting that 70% of pastures, fruit and almond orchards are located in the Upper Galilee and the occupied Golan.
The newspaper quoted the Director of the Compensation Fund at the Tax Authority, Amir Dahan, who is responsible for the compensation system for property damage, as saying: “If the fighting stops at this stage on the northern border, we estimate that we will receive between 5,000 and 7,000 claims for compensation for direct damage to property.” “At a value of 500 million shekels, not to mention the indirect damages.”
