Legislation could compel Defense Ministry to buy only Israeli textile
Bill proposed by Manufacturer's association could prevent ten textile factories in Israel from shutting down.
By Ora CorenThe Ministerial Legislation Committee is slated to discuss on Monday a proposed bill that would allow only Israeli companies to participate in Defense Ministry and Public Security Ministry tenders for textile supply.
"The tender will stipulate that only companies that manufacture goods in Israel are permitted to vie for the contract," the proposal reads.
The proposal was initiated by the Manufacturers' Association and has been endorsed by MKs Shelly Yachimovich (Labor), Stas Misezhnikov (Yisrael Beitenu), Magali Wahaba (Kadima), Moshe Kahlon (Likud), Yitzhak Ziv (Pensioners), David Azoulay (Shas), Moshe Gafni (United Torah Judaism), Dov Hanin (Hadash), Ran Cohen (Meretz), Benyamin Elon (National Union) and Eliyahu Gabai (National Union).
The proposal does not call for new legislation; rather it recommends an amendment to the existing tender law. The law currently rules that in government tenders, a preference must be given to Israeli companies within a range of 15 percent. That is to say that an Israeli company can make a bid that is 15 percent more expensive than a foreign bid selling an identical product, and the law would require the purchaser to give the contract to the Israeli bidder. However, if the Israeli bid is outside the 15 percent range, the purchaser is free to accept the foreign bid.
The proposed amendment would eliminate the option of giving the contract to a foreign company, regardless of its bid, in government textile purchases.
Head of the fashion and textile union and CEO of Tefron Yossi Shiran warned that if the proposal is not approved, ten textile factories employing over 500 workers could be forced to shut down. Most of these factories are located in peripheral cities where unemployment is rampant.
Shiran also emphasized that a similar law exists in the United States, protecting American manufacturers. He explained that the American defense establishment is permitted by law to purchases textile only from American companies.
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About 15 years ago in Toronto,the Government put up road signs indicating one area as being the Fashion district.The musty old buildings that were full and vibrant with garmentos 30 years ago were still going 15 years ago but after they put up those signs and then Globalism snuck in to the market the Garment trade came crashing down. Today those buildings are inhabited by companies promoting,branding,photographing,Advertising, positioning,head hunting...anything but making goods.Nobody is over 40 and the language is all computer driven.But nothing is being made.The factories are virtually all in China now but those buildings now house companies that add value to that chinese product.They are todays modern businesses.
It is a very good idea. The US can no longer provide uniforms or boots for our army. Israel should not find itself in the same boat.
Let's look at history. It was the protectionist policy of the United Kingdom that created the mass unemployment and rampant poverty which resulted in mass migration to the New World, and enormous loss of British population.
Protectionism appeals to the simple minded, but actually hurts the economy. Every country can be more productive if it focuses on the industries for which it is best suited. This is known in economics as "competive advantage." For example, NAFTA caused many US jobs to move to Mexico, but better, higher paying jobs were created in the US causing the economy to boom and unemployment to drop to very low levels. The problem is that the people who stand to lose their jobs protest loudly, but those who eventually get better jobs do not know that in advance.
Protectionist stupidity & selling out to interest groups will not improve our economy. Quite the contrary, it exemplifies what has been wrong with our economy since the founding of the state. Open markets, competition, & an emphasis on quality education linked with policies to end monopolies, gov't. bureaucracy, & limit the public sector will give us economic success.