TEL AVIV – The coronavirus could cause up to a one percent drop in Israel’s GDP, according to Finance Ministry estimates released Monday, as the epidemic starts to pummel the global economy.
Israel could stand to lose between NIS 3.6 billion ($1 billion) and NIS 14 billion ($4 billion), the ministry said, and that forecast does not account for a “nightmare scenario” of a widespread outbreak of the virus in Israel, the Hebrew-language Globes newspaper reported.
A second Israeli who returned to Israel on Friday from a cruise ship has tested positive for the virus and is in isolation in Sheba Medical Center. Both Israelis contracted the disease while overseas. The other 11 Israeli passengers were evacuated from the coronavirus-stricken Diamond Princess Thursday after spending more than two weeks quarantined off the coast of Japan. They are now in quarantine in Israel.
Finance Minister Moshe Kahlon held an emergency meeting, attended by ministry officials as well as representatives from the Bank of Israel.
The Finance Ministry’s chief economist Shira Greenberg said that so far macroeconomic activity has not been affected by the virus, but the ministry has received reports from companies of potential damage, and in some cases, major companies have already felt significant losses.
Israel’s national carrier El Al Airlines has lost $50 million to date over the crisis, Transportation Minister Bezalal Smotrich said last week.
The Bank of Israel Research Division’s latest growth forecast released in January sees the economy growing by 2.9% in 2020, but the bank’s governor, Prof. Amir Yaron, said at the meeting that if the crisis continues, the economic effects will be significant.
Israel’s tourist industry is likely to be hit biggest, with the country barring entry to foreigners who have been to China, Hong Kong, Macau, Thailand, Singapore, South Korea and Japan in the past two weeks and closing its borders entirely to foreign nationals from China and South Korea.
The Health Ministry said it would issue a travel advisory for Italy following the spread of the disease there, with five deaths so far.
Concerns have also been raised that the virus would stop people from going out to vote on election day next week.
However, Prime Minister Netanyahu on Monday said the virus did not constitute a good enough reason to postpone the vote.
“The corona[virus] is a big challenge. From the first moment I decided to take abundant preparatory measures that are stricter than any other country in the world. I don’t see a reason at the moment to delay the elections,” he told Jerusalem Radio.
Hundreds of Israelis have self-quarantined over fears they had been exposed to the virus overseas or because they were in contact with South Korean pilgrims who were visiting Israel and who tested positive after returning home.
The Health Ministry on Sunday sent out the itinerary of the South Koreans’ visit to the country. 29 of the pilgrims were diagnosed with the virus.
Also on Sunday, Netanyahu sent out a directive that all South Korean tourists in the country leave on special flights. Some 622 left the same evening and the next day, the Israel Airport Authority (IAA) said in a statement. Around 900 Koreans still remained in the country.
Many spent the night in Ben Gurion Airport after hotels refused to accommodate them. Airport staff handed out mattresses and blankets.
The Education Ministry cancelled 29 upcoming school trips to Poland over the next month for more than 3,000 Israeli schoolchildren.
The Tel Aviv Marathon will go ahead on Friday as scheduled but only Israelis will be permitted to take part in the event.
Netanyahu on Sunday warned against attempts to tamper with the electoral process ahead of next week’s poll through the dissemination of false reports about coronavirus.
“There could be all kinds of elements, including foreign elements, which could interfere in the elections this way. We have an interest in stopping this,” Netanyahu said during a special assessment at the Health Ministry emergency situation room.
He added that Israel Police and the Shin Bet security agency would be tasked with combating any efforts to influence the vote.
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