Daily Roundup Check Please! Israel Handed Bill for Pillar of Defense

Interior Ministry dangles a carrot to get companies to head south; Tel Aviv won't see a shekel for rocket damage; Stocks stayed strong, didn't bat an eye during Pillar of Defense.

Ruth Schuster
Ruth Schuster
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Ruth Schuster
Ruth Schuster

Now for the compensation: With Operation Pillar of Defense over, the compensation machine is gearing up. The treasury roughly estimates the cost of the military campaign at NIS 2 billion, and civilian output losses and compensation at another billion. That includes repairing property damaged by missiles and compensating businesses for income loss. During the campaign's eight days, about 1,900 rockets hit Israeli buildings or other property such as cars. Damage to homes will be assessed by tax assessors. Negotiations over help for businesses is being handled in four-way negotiations between the Tax Authority, the Histadrut labor federation, and representatives of manufacturers.

Ministry urges - Go south, young industrialist: Five manufacturing plants near Gaza took direct rocket hits, suffering severe damage during Pillar of Defense, and other businesses down south lost customers to rivals in safer areas. While working on a model for compensating the businesses, Industry Minister Shalom Simhon is proposing to increase grants to companies that move down south, in order to boost southern Israel's economy.

No compensation for Rishon Letzion, Tel Aviv for indirect damage: Residents of Rishon Letzion may not seek compensation for indirect damage, though naturally rocket damage there – direct damage - will be cause for compensation. One rocket that hit the city damaged 172 apartments (to different degrees) and 66 cars. The residents of Tel Aviv and other areas in the greater Tel Aviv area (Gush Dan) are not eligible for compensation in any form.

Investors suffered not: Just to be clear, Israel's investors can't complain. The leading index on the Tel Aviv Stock Exchange gained 2.5% last week Last week a banker quipped that the financial cost of Pillar was that the price of Israeli CDS– essentially insurance on Israeli sovereign default - rose by 25 basis points last week. The point being, the world did not consider Israel to be much riskier than it had been before the conflict with Gaza exploded. It is true that trading had been even more volatile than usual last week, but the benchmark TA-25 index gained 2.5%, the broader TA-100 index gained 2.1% and telecom stocks gained 5.6%. (It is true that phone lines, fixed-line and cellular, light up after rocket attacks, but still) Oil and gas exploration shares gained 6.2% but then that's one index that tends to behave like a jackrabbit on acid. The shekel weakened a hair during the fighting but is widely expected to appreciate against the U.S. dollar and euro this week, say analysts, not even bothering to add that predicting exchange rates is a fool's game.

Closing the accounts on Operation Pillar of Defense, service not included. Credit: Bloomberg
Damage from a Qassam rocket that exploded in Sderot on June 23, 2012.
The result of a direct hit from rocket fire in Gaza on an apartment building in Rishon Letzion, just south of Tel Aviv.
Grad damage in Ashdod, Nov. 16, 2012.
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Damage from a Qassam rocket that exploded in Sderot on June 23, 2012.Credit: Eliyahu Hershkovitz
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The result of a direct hit from rocket fire in Gaza on an apartment building in Rishon Letzion, just south of Tel Aviv.Credit: AFP
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Grad damage in Ashdod, Nov. 16, 2012.Credit: Ilan Assayag
damage

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