Fischer, widely credited with guiding Israel\’s economy steadily through difficult economic waters, doesn\’t give reason for exit; Netanyahu: Fischer helped Israel grow through global economic crisis.
Bank of Israel Governor Stanley Fischer informed Prime Minister Binyamin Netanyahu on Tuesday that he will step down as Israel\’s central banker on June 30, two years before the end of his second five-year term.
A former Chief Economist at the World Bank and MIT professor, Fischer served as BoI Governor for eight years, and is widely credited with guiding Israel\’s economy steadily through difficult economic waters. He said that he was grateful for the opportunity to lead the bank, "especially during a challenging period that included the global economic crisis, a complex geo-political reality, and domestic social issues."
Fischer cited the passage of the Bank of Israel law in 2010 as one of his major achievements, increasing the bank\’s autonomy in setting monetary policy. The law actually watered down Fischer’s powers, turning over his decisions on the interest rate to a newly-established seven-member Monetary Committee, including three outside academics, who make monetary decisions collectively.
“Research has shown that on average group decisions are better than decisions taken by one person,” Fischer said at the time.
Prime Minister Netanyahu credited Fischer with playing a "major role" in Israel\’s economic growth and achievements. "His experience, his wisdom and his international connections opened a door to the economies of the world and assisted the Israeli economy in reaching many achievements, during a period of global economic crisis," he said.
"I thank Stanley Fischer. I had the privilege of working with him both as Finance Minister, when he was appointed to the position, and as Prime Minister over the past four years," Netanyahu said.
Finance Minister Yuval Steinitz said Fischer was not only an asset for the Israeli economy, but for Israel\’s international image.
"I thank him especially for his important contribution in Israel\’s acceptance into the OECD and the public support in the critical period of the Sheshinski Committee\’s activity, against the intense pressure that we had to deal with in Israel and the world," he said. The Sheshinski Committee crafted recommendations on how Israel should tax its oil and gas in early 2011.
Interior Minister Eli Yishai added that at the helm of Israel\’s central bank, Fischer was "the envy of world\’s nations."
Members of the Labor party, however, tied Fischer’s departure to the economic troubles facing Israel, saying his decision to leave was a vote of no confidence in Netanyahu.
"Although Fischer and I often disagreed, we worked together on the Finance Committee on legislating the Bank of Israel Law, and I can attest that he was a brave Governor, undeterred from taking unconventional steps," she said.
"Given that there is no fundamental ideological division between him and Netanyahu, his resignation sends an alarming message to the citizens of Israel. The governor is signaling that he is not ready to be part of the economic chaos and social hell that will prevail after the new government forms."
Labor MK Yitzhak Herzog praised Fischer more forthrightly in his critique of Netanyahu, saying, "The citizens of Israel felt security and peace of mind from his position as the Governor. With his departure, a cloud of doubt will hover over the economic policy of Binyamin Netanyahu and the public trust will decrease even further.”
Sources at the Bank of Israel, however, say that Fischer had never been expected to finish his second term. He made his decision to leave before the elections, but waited to announce it until afterwards to avoid politicization. According to the source, Fischer has not considered what he would do if the government fails to pass a budget within 45 days of the government being seated, which would trigger new elections.
01/04/2023
