Israel urged to curb social inequalities

OECD calls on Israel to reduce inequalities faced by Arabs in education, employment.

TEL AVIV - Israel must curb social inequalities that mainly affect Arabs and ultra-Orthodox Jews, the OECD said Wednesday, as the Jewish state readies to join the organization.

Gross domestic product grew by an estimated 0.5 percent in 2009, more than previously expected, the Organization for Economic Cooperation and Development said in reports released in occupied Jerusalem.

GDP growth in 2010 is expected to reach between three and three and a half percent.

"But there are weaknesses in the Israeli economy, particularly on the social welfare side," said OECD Secretary General Angel Gurria who on Tuesday met Israeli leaders for talks aimed at paving the way for the accession of the Jewish state to the organization, likely later this year.

The report praised the authorities' response to the global downturn, but pointed to what it called weaknesses in economic policy, particularly the Bank of Israel's continued intervention in foreign-currency markets.

Another report on labor and social issues said that one in five Israelis lives in poverty, a higher ratio than in any OECD country.

Poverty is highest among the youngest and fastest growing population groups: just over half of Arab Israelis and 60 percent of ultra-Orthodox Jews -- known as Haredi -- have disposable income that is less than half the national median.

About 40 percent of Israelis aged between 15 and 64 are not working, compared to an average of 33 percent among OECD member states.

Most low-paid jobs with little security are filled by Arabs, Haredim and foreign workers and employment levels are particularly low among Arab women and Haredi men.

Israel spends the equivalent of only 16 percent of GDP on social policies as compared with an average of 21 percent for OECD countries, the report said.

The report called for the government to encourage the Haredim to strengthen their vocational skills as part of a drive for a more self-sufficient -- and less poverty-ridden -- balance between religious worship and work.

It also urged action to promote fair employment opportunities among the most vulnerable parts of society.

Both reports stress that employment and social inclusion are vital to Israel’s future economic development and require increased public spending.

"Real progress on social issues requires a more inclusive society and better chances for all citizens to share the fruits of economic growth," said Gurria.

The OECD also urged Israel to reduce the inequalities faced by Arab Israelis in education.

It stressed that while there is a need for increased spending on social policy, Israel must nevertheless reduce the burden of public debt on a sustainable basis.

Gurria said on Tuesday after meeting Israel's leaders that the country is on track to join the OECD.

Israeli officials expect to join the OECD, which seeks to coordinate economic policies among the world's leading industrialized nations, within months, three years after the start of the membership process in May 2007.

When founded in 1961, OECD membership represented 75 percent of global wealth. Today it accounts for 60 percent and efforts are being made to enlarge membership to incorporate rapidly growing economic powers.

Israel has often come under international criticism for ‘racism’ and mistreatment of its Arab minority, who are the original inhabitants of the land.

Source: Middle East Online.
Link: http://www.middle-east-online.com/english/?id=36744.