What is Bennett’s 'Singapore Plan' for the Israeli economy?
And what does it have to do with Singapore?
During the recent Influencers Conference, Yisrael Beytenu chairman Avigdor Liberman quipped that his political rival, Yamina party chairman Naftali Bennett, is more likely to become the prime minister of Singapore than of Israel.
His comment was a sarcastic reference to Bennett’s plan for Israel’s economy, which he called the Singapore Plan.
Why is Bennett comparing Israel to Singapore? And what is his plan for improving the Israeli economy?
While the upcoming March 23 election is largely a referendum on Prime Minister Benjamin Netanyahu’s ability to continue leading the nation, few political parties have unveiled specific policies or visions for Israel’s future. By contrast, Bennett has spent considerable time and effort presenting Singapore as an economic role model for Israel’s economy.
This is not a coincidence.
There are several similarities between Singapore and Israel. Both countries are small and densely populated states, both were founded after World War II, both were originally poor and have faced hostilities from their respective neighbors. Singapore’s military was modeled after the Israel Defense Forces with the assistance of Israeli military advisors.
After gaining independence, both Singapore and Israel invested heavily in education and technological development. As a result, Singapore and Israel eventually emerged as first world economies by the end of the 20th century. While Israel became known as the Start-Up Nation, Singapore became a leading financial and technological hub in the global economy.
In his presentation, Bennett notes that Singapore and Israel had a similar GDP per capita in 2003. In 2020, however, Singapore’s GDP per capita was more than double that of Israel’s in terms of purchasing power. Bennett credits competent economic management in Singapore for the current considerable difference in GDP per capita between Singapore and Israel.
The premise of Bennett’s plan is that Israel is successful in innovation, but its economic potential is undermined by poor management and considerable bureaucracy. Bennett holds Netanyahu responsible for Israel’s current socioeconomic problems. While Netanyahu initially streamlined much of Israel’s economic bureaucracy, the cost of living in Israel remains very high due to regulations and lack of competition.
As a result, many young Israeli couples struggle to afford buying a home. In addition, customer service quality in Israel (especially in the public sector) is low compared to the U.S. and other advanced Western economies.
Bennett is the son of American immigrants and has a background as a successful high-tech entrepreneur. Using those credentials, Bennett is seeking to convince Israeli voters that he is also capable of dramatically upgrading the quality of life and standard of living in Israel. Bennett’s plan envisions doubling Israel’s standard of living within 10 years through effective management, transparency and considerable tax cuts.
Bennett also aims to reward working Israelis, while simultaneously dramatically reducing benefits for people who choose to remain outside the work force, such as many of the voters for Netanyahu’s ultra-Orthodox political allies.
While Israel is known worldwide for its innovative high-tech industry, much of Israel’s public sector remains low-tech and bloated. Bennett believes that customer service levels and quality of life in Israel can be dramatically upgraded by introducing effective high-tech management style to Israel’s inefficient and bureaucratic public organizations.
The All Israel News Staff is a team of journalists in Israel.