Jerusalem, Israel - June 21, 2017 - Day 2 of the Eli Hurvitz Conference on Economy and Society, held at the Citadel Hotel in Jerusalem, Israel, highlighted challenges and solutions for Israel’s excess regulation and bureaucracy.

Eli Groner, Director-General of the Prime Minister’s Office, said the government is acting. The government did a mapping of all regulations and decided that it could reduce regulation by 25 percent over 5 years. In the last year, Groner said that 1 billion, 300 million shekels previously wasted on regulation have been saved. 

Groner placed blame on the private industry for some of the country’s regulation challenges. He cited a recent case where IKEA is suing the government for not having strict enough fire regulations for sprinklers, after the building burned down in September 2011.

Regulations, taxation, and bureaucracy were mentioned over and over in course of the day in presentations. 

There must be a quicker solution, said MK Eli Cohen, Minister of Economy and Industry. “We have some of the most talented human capital, yet we compete with countries like Cyprus on taxation. We have to understand our edge does not lie in the export of tiles,” said Cohen. He said we need to eradicate Israel’s anti-business environment. 

We are known for research and develoment, but we need to become the Innovation Nation, businesses should not have to exit and go overseas. Dr. Ron Tomer, owner of Unipharm, pointed out that only one new factory was opened in Israel in 2015. The rest went abroad.

Dr. Augusto Lopez-Claros, senior advisor for development economics at the World Bank, said Israel is not ranked high when it comes to the bank’s Doing Business flagship report. Israel ranked 52 in the latest Doing Business report.

“The first 50 countries? Israel does not make the list,” Lopez-Claros said. In 2005, there were only 41 countries in which it took less than 20 days to get a business started. Today, there are 130. And Israel is not one of those, either.

Lopez-Claros elaborated with examples of problems clouding the investment climate, such as dealing with design risk in construction, a new system should be risk based. Also, paying corporate taxes on-line, is possible, but businesses still have to deliver paper, so the work becomes 3-fold and not simpler for those based overseas. Registering property entails expensive transfers for those taxes.. 

Regulation and bureaucracy are bad for business, Prof Zvi Eckstein, said for Israel to come up from the low number of 52 on nations of ease of doing business list, there must be more transparency and accountability.

MK Roy Folkman also spoke on regulation and taxation.  

The theme of the Eli Hurvitz Conference on Economy and Society, formerly known as the Caesarea Forum, Israel’s leading economic conference, was “Two Economies – One Society.” The conference, which is sponsored by the Israel Democracy Institute (IDI), focused on roadblocks and opportunities in a new economy versus a renewable economy, the future workforce, improving regulation, doing business, and rethinking the Israeli pension system.

Now in its 24th year, the conference serves as a juncture for public and professional discourse on society and economy. The goal is to improve the government’s decision-making processes and the quality of Israel’s social and economic policies for the benefit of the public.