Israel is expected to incur nearly 45 billion shekels ($12.9 billion) in direct and indirect losses due to the coronavirus outbreak, Israel’s Channel 12 reported.
The channel quoted economic experts as saying that the recent measures announced by the government to combat the virus including declaring a state of emergency and reducing private sector work by 70 per cent will exacerbate the losses.
According to the channel, the pandemic’s global impact will have local repercussions in the country, including a drop in GDP growth.
Israel’s Yedioth Aharonoth newspaper said that Israel is expected to lose eight billion shekels ($2.16 billion) by the end of April due to the measures taken to confront the virus, pointing out that these losses are only from the state treasury and do not include the private sector’s losses.
According to the paper, the estimated losses include the non-collection of income tax, value-added tax, purchase taxes and tariffs in parallel with increased government spending.
Calcalist business daily quoted the Director-General of the Israeli Ministry of Finance, Shai Babad, as saying that if the coronavirus crisis continues for three months, there would be dangerous repercussions including the collapse of many companies.
Babad said disrupting the economy for a period of five weeks will affect nine per cent of the GDP while disruption of economic activities for a period of 12 weeks would affect 18 per cent of GDP which is “an unprecedented rate since the country’s establishment”.
“This means that the Israeli economy will suffer a fatal blow, especially companies, as many of them will collapse,” he said.
There are 9,006 coronavirus cases in Israel. Sixty people have died of the disease.