Netanyahu Still Undecided on Next Central Bank Chief

The reason is apparently that he is seeking a globally recognized personality, much like Fischer, who Netanyahu lobbied to take the job eight years ago.

Meirav Arlosoroff
Meirav Arlosoroff
Meirav Arlosoroff
Meirav Arlosoroff

With just two weeks left before Bank of Israel Governor Stanley Fischer formally steps downs, Prime Minister Benjamin Netanyahu is struggling to identify a suitable successor.

As far as anyone knows, the prime minister has made no decision on the key position, nor has he approached any candidates or met with them, sources said.

The reason is apparently that he is seeking a globally recognized personality, much like Fischer, who Netanyahu lobbied to take the job eight years ago.

As the date of Fischer’s departure grows closer, the delays have been making some people anxious. Fischer has left his successor the tricky and contradictory tasks of weakening the over-valued shekel, stimulating a slowing economy and keeping a lid on housing prices.

“As an ordinary citizen I am disappointed that no successor to Fischer has been chosen. It’s causing great damage to the economy,” Dan Proper, chairman of the Bank of Israel’s supervisory committee, said at an event in Jerusalem for the outgoing governor.

But if Netanyahu is hoping to snag such a candidate for the Bank of Israel, he is not known to have pursued any potential candidates. Moreover, the assessment is that he will have a great deal of difficulty finding one.

The new governor not only has to have a worldwide reputation as a senior economist, but one specializing in central banking and monetary policy, and he or she would have to move to Israel and learn fluent Hebrew. There are few people in the world who can meet all these criteria.

As to Israeli candidates, the prime minister is not believed to have invested much time or thought in them either.

As far as is known, Netanyahu has interviewed two prospective governors since Fischer announced in January that he would be leaving at the end of June. They are Karnit Flug, who is now the deputy governor, and Manuel Trajtenberg, a former chairman of the National Economic Council and the head of the socio-economic committee formed after the protests of 2011.

Netanyahu knows both personally, but the fact that he has not hinted at which of the two he prefers suggests he is not happy with either. Nor is Netanyahu believed to have any preference for other Israeli candidates who have been suggested for the job.

Many say there is a good chance Netanyahu will not fill the governor’s job by the end of June, if he keeps to his plan to find a candidate with global stature. If so, Flug may serve for several months as interim governor. Under the Bank of Israel law, she would automatically fill the post with the same authority and powers as a regular governor.

Prime Minister Benjamin Netanyahu and Bank of Israel chief Stanley Fischer. Credit: Tomer Applebaum

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