Newly appointed Finance Minister Avigdor Lieberman has declared his intention to rebuild the post-coronavirus Israeli economy through partnership and dialogue with the unions, business leaders, and the Bank of Israel. Israeli economic history, as well as recent policies adopted around the world, suggest this might be a good idea.

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One of the first actions Lieberman took after taking office earlier this week was to convene a roundtable to discuss strategies towards economic recovery. Three main players were involved in the roundtable: the Histatdrut, as represented by Chairman Arnon Bar-David; the business world, as represented by Ron Tomer, President of the Manufacturers Association, and Dovi Amitai, chairman of the Business Sector Presidents organization; and the Bank of Israel, as represented by its governor, Amir Yaron. A roundtable of this sort was first convened when the parties took part in shaping the Israeli response to the 2008 financial crisis.

People walking by closed shops on Jaffa Street in downtown Jerusalem on September 21, 2020, during a nationwide lockdown. (Photo: Yonatan Sindel/Flash90)

By returning to a tripartite roundtable, Lieberman is acting in accordance with the Organization for Economic Cooperation and Development’s recommendations for shaping post-coronavirus economic strategy through dialogue between the government, workers, and employers. A report released by the organization at the end of 2020 claimed that tripartite dialogue was a key factor in bringing about economic recovery.

The OECD report mentions several countries where such dialogue helped shaped government’s reactions to the coronavius crisis in the early stages of the pandemic. The report mentions as an example the Austrian government’s adoption of a flexible furlough scheme in cooperation with both unions and business leaders in the country. Meetings between the parties continued for months into the crisis, which allowed the government to adapt its policies to changing economic conditions with minimal conflict.

The idea of a tripartite roundtable has precedent in Israeli economic history. In 2008, following the global financial crisis, there were efforts to establish a permanent forum which would include representatives of all three parties, and in 2009, a long term economic plan was negotiated between the three sides. However, the forum met again only in 2016, and former Finance Minister Israel Katz refused to consult unions and business leaders during his tenure.