Billions of dollars flow out of Israel over judicial reform concerns
Experts claim that if the withdrawal of capital from Israeli banks continues, the Israeli government will place restrictions on capital flow
By News Desk - February 16 2023

(Photo Credit: Flash 90)

After several banks and economic analysts warned the public about Israel’s recent judicial reform, several Israeli companies have begun to move their money abroad, amounting to $4 billion in the past three weeks, according to a report from Ynet News published on 15 February.

According to undisclosed sources, most of the withdrawn money had been transferred to several EU countries and the US, more so with individuals than institutions. However, the Bank of Israel claims there have not been any “unusual movements of funds abroad,” adding that the bank is continuously monitoring the situation.

“I do not trust this government,” an unnamed individual revealed to Ynet. “I’m not on the left or the right. I’m Israeli, but I’m concerned that the reforms will badly harm the economy and the Shekel. Therefore, my money will be worth a lot less very soon; we can already see that trend now.”

The chairman of the financial consulting firm Auren Israel, Ofir Angel, remarked that if the withdrawal of capital from Israeli banks continues, the Israeli government may potentially place restrictions on moving money abroad.

Local sources reported that several individuals holding $5-50 million in liquid assets have been exploring various avenues to apply for foreign citizenship in a bid to transfer their money to foreign banks.

Earlier this month, Israeli cybersecurity corporation Wiz revealed its plans to withdraw its money from Israel following the Knesset’s judicial reforms. The cyber company is valued at $6 billion and is reportedly set to withdraw tens of millions of dollars from national banks.

Co-founder and CEO of Wiz, Assaf Rappaport, reportedly planned to go through with the recent move following immense pressure from investors concerned about Israel’s judicial reforms.

Opposition members of the Knesset (MK), such as the former Israeli prime minister Yair Lapid, have previously questioned the validity of such reforms, warning that the new government threatens ‘democracy in Israel.’

In December 2022, over 1,000 Israeli air force officials sent letters to the Israeli supreme court, urging that it halt the formation of Netanyahu’s coalition government and claiming that the new government would destroy “Israeli democracy.”

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