Israel caves to large retailers who refused to open, offering up 6 billion in aid

The retailers had refused to reopen Sunday without more guaranteed government aid.

By Batya Jerenberg, World Israel News

The government decided Sunday night to respond positively to the demands of large retail chains for additional aid. They had refused to reopen in the limited format announced on Thursday by the health authorities due to the continued health crisis caused by the coronavirus pandemic.

The additional state-guaranteed 6 billion NIS (new Israeli shekel) loan fund, not included in the already ratified NIS 80 billion stimulus package, will go to the Knesset for approval following Israeli Remembrance Day and Independence Day, which fall on Tuesday and Wednesday.

Citing economic reasons, most major chains in Israel did not jump at the chance to announce they are reopening this week when the Ministry of Health said they could do so last Thursday.

Loosened restrictions included allowing restaurants on the street (as opposed to indoor malls, which would remain closed) to open for delivery and take-out services. But chains such as Café Greg, Aroma Tel Aviv, Coffix, Landwer and Café Café and their subsidiaries said they could not afford to do so.

“Until we understand where the state’s compensation stands, we will not open,” said Ronen Namani, co-owner of the Café Café group. “Right now, even as is we are barely surviving, if we start work at all we will be wiped out.”

Only some 30 restaurants in his 200-strong chain have been open for food deliveries throughout the coronavirus crisis.

Namani’s concern regarding the money promised to businesses by the government to make up for the forced shutdown was shared by other large chain owners.

Israeli fashion and commercial retailers such as Fox, Optica Halperin and Hamashbir Latzarchan declared a strike Thursday, writing to Prime Minister Benjamin Netanyahu that opening “without receiving a government safety net would only deepen the heavy losses and the pit we fell into.”

“Unfortunately, the Israeli government will continue to fund the salaries of our 350,000 employees (about NIS 3 billion a month) until the Treasury will understand the magnitude of the crisis and the severity of its mortal blow, and fully accept our demands. Our oxygen has been depleted,” they added.

Finance Ministry officials reacted furiously, saying, “This is an attempt to extort the government and turn the employees into hostages.”

Earlier last week, restaurants had complained about being frozen out of the relaxation on the economic front that saw the reopening of furniture, home appliance, textile, carpet and paint stores.

The most notable name brand was that of IKEA, which reopened three of its branches in the restricted fashion demanded by the health authorities and was rewarded with huge lines of masked customers waiting patiently for their turn to go in.

Disgruntled owners posted pictures on social media of their businesses with the Swedish retail giant’s iconic logo papered over their own names, accompanied by the tagline, “We are all IKEA.”

coronaviruseconomic crisis