Nir Barkat, Israel's economy minister, is among the favorites to take over from Beniamin Netanyahu at the head of Likud. In a climate of social tension due to the judicial reform promoted by the government, the former mayor of Jerusalem and pioneer of the hi-tech sector traveled to the Mobile World Congress (MWC) to promote economic cooperation with Spain.
The plenary session of the Barcelona City Council reversed the unilateral declaration of the mayor Ada Colau that broke the twinning with Tel Aviv.
Israel loves the Spanish, you are a kind people. It is a pleasure to be here, and I know that the Spanish who come to Israel also enjoy our country. The economy builds friendships, and we will continue to develop our bonds. We come to do business, to increase imports and exports between both countries for mutual benefit. We want relationships to continue to flourish.
With a GDP growth of 6.3% in 2022, the Israeli economy was ranked as the fourth most powerful in the OECD. What is Israel selling at the MWC?
A lot of technology, we are leaders in entrepreneurship. Our challenge is to continue expanding technological production and importing it all over the world. Together with the government of Spain, we analyze the areas in which each country stands out best to improve people's quality of life.
The Abraham Accords, which formalized diplomatic relations with Arab and Muslim states, promoted the economic opening of his country in the Middle East.
It is about genuine peace, based on shared interests and mutual respect. It's a win-win: we focus on the right thing when the wave of peace spreads. We also forged a common front against the Iranian threat. We have joint threats and shared goals.
Will peace come with Saudi Arabia?
It's cooking, we hope so. The Abraham Accords took time.
Jacob Frenkel, former governor of the Bank of Israel, warned that the approved judicial reform will erode the separation of powers and weigh down the economy. Will it affect foreign investment?
I see it as a huge opportunity. No one, including Frenkel, who I met with, denies the need to reform the judicial system. The change will end up improving democracy and the economy.
The hi-tech sector joined the protests against the government. “From startup nation to shutdown nation ”, read a poster, in which Netanyahu's face appeared together with authoritarian leaders such as Erdogan, Orbán or Ayatollah Khomeini.
At the MWC you can see the potential of our hi-tech sector. There is an intense political debate. The new government received the mandate to promote changes in the relationship of the legislative, executive and judicial powers. We are the only democracy in the Middle East and the protests are legitimate.
The opposition considers that it will be the end of democracy, it will shield Netanyahu from his legal cases and there are reservists who call for disobedience to “not serve in the army of a dictatorship”.
The changes we promote already exist elsewhere. In most Western countries, judges are elected by parliaments, not by the judges themselves. In the UK, the attorney general is a government minister and if you don't like his decisions, a second opinion is valued. In Israel, the legal adviser is above the government and this must change. We want to become more like the West.
President Isaac Herzog implored negotiation. Is there a risk of an intractable fracture?
There is a legitimate political debate, and we are open to negotiations to reach greater agreements.
Israel has a strong economy, but it moves at two speeds. It is estimated that almost one million households (27% of the population) live below the poverty line.
Today there are some 360,000 workers in the hi-tech sector, 10% of the labor market. Our twenty-year goal is for 25% of Israeli workers to be part of this sector, so that everyone can enjoy its benefits. It is necessary to reform the educational system to achieve greater synchronization. We must also increase exports.
The high cost of living is the main problem for many families. How are prices lowered?
Improving our industry. I will also promote a law that allows free exports. The current regulation does not allow us to compare ourselves with Europe. We must change the model and increase competitiveness.
End the monopolies?
Fairly. There are producers who sell in Israel at much higher prices, and the laws hinder importers. For this reason, there are products here that are 25% more expensive than in other European countries.
Will the violent rebound with the Palestinians affect the economic prosperity of the region?
We will chase the terrorists, we will attack them before they harm us. But on the other hand, we will foster shared industries with the Palestinians in the West Bank. Both things go hand in hand.
