by Keren Setton
JERUSALEM, March 11 (Xinhua) -- Israeli experts have mixed views on what impact that the strong measures taken by the government to fight the novel coronavirus will have on Israel's economy.
With tens of thousands of its citizens under home quarantine and its main international airport nearly empty, some experts started to worry about the economic impact of these measures.
Israeli health authorities on Wednesday announced 22 new cases of COVID-19 infection, bringing to 97 the total number of the confirmed cases in the country.
To prevent the spread of the virus, Israeli government has announced that anyone entering the country should undergo a 14-day quarantine.
This will likely deter foreigners from travelling to Israel. In response, many airlines have already suspended flights to Israel, experts said.
"This is not a measure that can be maintained for more than two weeks," Dan Galai, finance professor at the Hebrew University of Jerusalem, told Xinhua.
"The Israeli economy is heavily reliant on its international business connections, imports and exports. This will not be sustainable," Galai added.
It is estimated that the quarantine measure will cost the Israeli economy over 1 million U.S. dollars a month, mainly because of the fact that people cannot go to work.
Earlier this week, Bank of Israel, the country's central bank, announced an expected loss of 0.7 percent in GDP growth this year.
"Israel is a very small player on the global stage," said Benjamin Bental, professor of economics at the University of Haifa and the Taub Center. "This makes Israel very vulnerable to all the risks."
Meanwhile, the country has been under a care-taker government for over a year. The previous two elections in 2019 failed to result in a permanent government, which means that Israel is functioning without an updated budget. Following the latest election, it seems that the political deadlock will continue.
The Israeli budget remains the same as that of last year and is handed out on a monthly basis without consideration of population growth and the recent crisis.
"Lack of a government makes it difficult to make decisions," Shlomo Maoz, a prominent Israeli economist, told Xinhua.
The tourism industry in Israel has been the first to suffer a drastic blow by the outbreak of the coronavirus, the experts said.
Israeli airlines have already begun the process of laying off workers and three major hotel chains have issued profit warnings as a number of reservations were cancelled.
There has been criticism in Israel that the measures taken to curb the spread of the coronavirus are not considerate enough for the economy, especially for the small- or medium-sized businesses.
"In wars, you know more or less how long they will last," said Galai. "You can estimate the costs. But, here, the horizon is unclear and not in our hands."
Bental said that the cost of the current measures is "immense," including increase in the costs and the damage to the market.
However, there is also room for optimism, the experts said.
"The crisis hits Israel when the outlook of its economy is positive. The country's unemployment is at record low and its economy is dependent on more than one industry including the hi-tech industry which is currently less influenced by the coronavirus," said Galai.
Maoz highlighted that, as most of Israel's exports to Europe are in the research and development field, which is not affected by recent restrictions.
"Israel has taken the right steps despite the criticism," he said. "The crisis is unprecedented which is not a fiscal or monetary one."