Though the outbreak of COVID-19 has managed to cause governments around the world to boost spending in an attempt to contain the economic downturn and has pushed the OECD to call on countries to 'greatly increase public spending even at the cost of growing levels of debt and deficits', the Israeli government seems set on sticking to its low-deficit policy even as threats to the economy rise.

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The largest economies in the world are now announcing huge fiscal stimulus packages to deal with the economic slowdown and prevent a deep recession, which experts warn might be the worst in almost a century. In the US, the Trump administration is pushing for a stimulus package larger even than the Obama administration's response to the 2008 crash. And that is just the start.

Food packages for the needy (Archival photograph: Olivia Pitosi, Flash90)

Some countries have announced their intention to invest unprecedented amounts of cash to prevent economic catastrophe. New Zealand, for instance, unveiled a plan to spend 4 percent of it's GDP to boost social security, and infrastructure projects. Denmark looks set on spending 13 percent of it's GDP to avert a crisis and 'freeze the economy' by directly subsidizing workers' salaries. Even more modest stimulus packages like Canada's 3 percent GDP have surpassed by far Israel's reaction to the crisis.

Last week, the Israeli government announced a NIS 7 billion emergency fiscal package, equivalent to 0.5 percent of GDP. In fact, the Israeli fiscal package is set to be the smallest set of spending measures taken by any major economy in face of the COVID-19 crisis.

While the government has pledged NIS 2 billion to fund extra costs to the healthcare services, and another NIS 5 billion in infrastructure spending, it has done very little up until now to compensate businesses and workers for loss of income. While offering an additional NIS 8 billion of government backed loans, the government's reaction falls vastly short of steps taken by other major economies his by the coronavirus.