Prime Minister and Minister of Justice. The rating agencies are having trouble with Netanyahu's double language, which promises them a halt to the reform, and Levin's rival its continuation (Photo: Roni Knafo)
The Israeli economy is stable, but conditionally: The Fitch rating agency published a new report today relating to Israel's credit rating. The company does not harm the current rating or the "stable" forecast given in its previous report, but adds a cautionary note, in light of the prime minister's remarks after the budget was approved, regarding the intention to pass the reform in any case (Netanyahu later issued a clarification that he intended the reform by broad consensus).
"The legal reform has the potential to adversely affect Israel's credit rating if it weakens government institutions, or if the weakening of the protests leads to worse policy outcomes or negative attitudes among investors." The report said.
Netanyahu's speech is explicitly addressed, because it indicates, according to Fitch, that "the coalition's plans are still unclear."
It seems that the prime minister's statement – and the clarification that followed – succeeds in angering Fitch, who may not be aware of the nuances by which Netanyahu once speaks to Israeli ears, especially the extremists in his government who demand the continuation of the legislation anyway, and otherwise to international ears – especially those at the rating agency – to whom he promises that reform will not be passed except by broad agreement.
In any case, if anyone wondered about the impact of the protest, Fitch's report indicates that it actually has a positive effect on the credit rating – and the danger lies not in the continuation of the protest, at least according to Fitch, but rather in the fact that "its weakening will lead to bad political results," that is, it will encourage Netanyahu to adopt the position of some members of the coalition, which demands the continuation of the legislation.
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