Mario Blejer, New Bank of Israel Candidate, to Be Grilled by Panel

Blejer, an Argentine Jew who immigrated to Israel and has held senior posts at major financial institutions, is the third candidate for the post since Stanley Fischer left.

Mario Blejer, Prime Minister Benjamin Netanyahu's latest candidate for the post of Bank of Israel governor, is due to meet with the Turkel committee for senior government appointments today. Blejer, an Argentine Jew who immigrated to Israel and has held senior posts at major financial institutions including the International Monetary Fund, arrived in Israel on Friday and met with Netanyahu at his home in Jerusalem.

Blejer's name appeared in the media as the next candidate for the post Thursday night. Netanyahu had first sought to appoint former Bank of Israel Governor Jacob Frenkel and then Bank Hapoalim Chief Economist Leo Leiderman, but both men withdrew their candidacies.

Netanyahu has himself questioned several senior Israeli economists who know Blejer well. Blejer then filled out the standard forms required by the Turkel committee and handed them in before boarding a flight to Israel.

Blejer is expected to be approved by the Turkel committee and the government within a week or two, say sources in the Prime Minister's Bureau. Blejer, who has a PhD in economics from the University of Chicago, believes in minimal intervention in the markets.

Netanyahu is under pressure to appoint a successor to Stanley Fischer amid international pressure and no lack of ridicule. Frenkel withdrew his candidacy amid allegations that he had failed to report accusations of shoplifting; Leiderman withdrew his candidacy within a matter of days.

Over the weekend, Reuters termed the situation a "comedy of errors," stating that the departure of two candidates in one week had raised “questions not only over Netanyahu's judgment but also much wider concerns about Israel's economic management."

Blejer, 65, served as Argentina's central bank governor for six months in 2002, while the country was going through its worst financial crisis. He also worked at the International Monetary Fund for 21 years, filling top positions. In the 1980s he was a Hebrew University professor and worked at the Bank of Israel.
In a conversation yesterday, Netanyahu tried to ascertain Blejer’s positions on key economic matters and whether he had any skeletons in his closet that could impede the appointment.

On Thursday, Netanyahu submitted the names of four candidates to the Turkel committee to speed up the process should one of them not pass. Blejer was one of the four. The other three were former central bank governor Zvi Eckstein, Finance Ministry Accountant General Michal Abadi-Boiangiu and veteran Bank of Israel official Victor Medina.

Notably missing were several other senior figures in Israel's economy, particularly Karnit Flug, currently acting governor and Fischer's deputy before he left office. This indicates that Netanyahu has rejected them out of hand. Blejer speaks fluent Hebrew and visits Israel often to see friends and family.

Shortly after quitting the Argentine central bank, Blejer gave a well-received speech at a Bank of Israel conference on Israel's economy. The conference was organized by Flug, then head of research at the central bank. Blejer, then a senior official at the IMF, spoke about macroeconomic lessons based on Argentina's crisis; he lectured in English but answered questions in Hebrew. He declined to respond to attempts to draw connections between the economies of Israel and Argentina.

Blejer is familiar with Israel's economy, and the local economic community can be expected to embrace him warmly. If his application is approved, he is likely to take up the post shortly.

Also today, the cabinet is expected to grant Jacob Turkel a three-year extension as head of the committee on senior appointments.

Currently, Turkel committee members may serve no more than two three-year terms. Netanyahu is asking his ministers to let committee members serve for three terms.

Bloomberg