25,000 businesses in Israel could close by end of 2020 – report

Some 25,000 businesses in Israel could be forced to close down by the end of the year as a result of the economic fallout from the coronavirus pandemic, an Israeli information services company has warned.

CofaceBDI forecast that the closures would come in two waves, the first of which would be felt in the coming weeks, Channel 12 news reported Sunday.

Business in sectors already reeling from the shuttering of large swaths of the economy, such as tourism, travel and leisure, would be among the first to close, the company said.

It also included in the first wave retailers that don’t sell food or do online deliveries, wholesalers and companies that are export dependent.

The second wave will include companies involved in real estate and industry, according to CofaceBDI.

“Effectively the second wave is influenced both by the collapse [of businesses] in the first wave and the decline in the public’s purchasing power, the number of unemployed, faulty transfer of payments, etc.,” the firm’s CEO, Eyal Yanai, told the television channel.

As with other countries, Israel’s economy has been hard hit by the closure of businesses due to the imposition of far-reaching measures to contain the virus.

On Sunday, the cabinet approved a slight easing of the restrictions that have brought the economy to an almost total standstill. However, non-essential small businesses, such as those in the culture, fashion, and beauty industries as well as shopping malls, could still face a long wait until they are able to return to full work. Pundits have predicted they will be among the last released from restrictions in any plan to end the lockdown.

Since the government began introducing lockdown restrictions requiring most Israelis to remain at home except for essential needs, the unemployment rate has rocketed from around four percent at the beginning of March to 26.25% by mid-April, with 1,093,465 now jobless.

Earlier this month, the government approved emergency grants for self-employed Israelis whose businesses have been hit by the coronavirus pandemic. The funds will go to businesses that have seen at least a 25% decline since the start of the crisis in Israel in March, compared to the same period last year.

Many self-employed small businesses owners have decried what they say is a lack of state assistance, with hundreds rallying near the Knesset Sunday to call for the government to help them weather the crisis.