Barkat said to tell US bankers that only a negotiated judicial reform will pass

Economy Minister Nir Barkat told a group of US bankers that Prime Minister Benjamin Netanyahu is committed to reaching an agreement with the opposition on the controversial judicial overhaul, Channel 12 reported Wednesday.

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Barkat’s comments are the latest government effort to reassure the international community, particularly the financial world, that the planned judicial reforms will not harm Israel’s democracy and system of checks and balances.

This messaging stands in contrast to hardline statements being made for domestic consumption, in which the coalition is still vowing to push through much of the contentious legislative package if talks being hosted by President Isaac Herzog fail.

“The legislation will pass, through agreement. This is also the position of the prime minister,” Barkat was quoted as telling a meeting of US bankers.

“The talks at the President’s Residence are progressing excellently. There are agreements on most issues; it’s nearly finished,” Barkat said.

Barkat declined to comment on the Channel 12 report.

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Israelis protest against plans by Prime Minister Benjamin Netanyahu’s government to overhaul the judicial system, in Tel Aviv, June 3, 2023. (AP Photo/Ariel Schalit)

On Tuesday, Yossi Shelley, director general of the Prime Minister’s Office, suggested in a radio interview that the government’s judicial overhaul plan was as good as dead and “going to disappear.” Shelley later the same day issued a statement saying that he did not mean to imply that “we need to withdraw from the legal reform, which we are committed to,” but rather meant to stress that the government is also involved in many other issues at the same time.

And on Wednesday, Minister of Culture and Sport Miki Zohar put a different spin on the situation speaking to Channel 12.

“The reform will go ahead, it’s just not clear to what extent,” Zohar said. “The prime minister also understands that, if the judicial reform does not go ahead this government will not last. We won’t have a government.”

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Culture and Sports Minister Miki Zohar at his office in Jerusalem, January 2, 2023.(Yonatan Sindel/Flash90)

While Netanyahu faces threats from hardline coalition partners demanding that he push through the reform, he has also faced intense pressure from large swaths of the public who have held demonstrations for 22 weeks against the plan.

He has also seen financial markets react negatively to hints the reform will go through, with the shekel acting as a barometer.

The shekel appreciated against the US dollar for a second day on Wednesday amid signs that the overhaul would not be advanced as planned and amid cautious optimism that a compromise could be reached.

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Anti-overhaul protesters march at the Celebrate Israel Parade in New York City, June 4, 2023. (Courtesy, NYC Loves Israeli Democracy/ Roi Levin)

The local currency appreciated more than 1.8% to 3.64 against the greenback in intraday trading after hitting a four-year low last week amid political uncertainty over the overhaul.

Tel Aviv Stock Exchange’s benchmark TA-125 index gained 2% and the TA-35 index of blue-chip companies rose 1.8% at the close in Tel Aviv.

Protests against the overhaul have followed government MKs and ministers, many of whom have traveled to the US in recent days.

Diaspora Affairs Minister Amichai Chikli saw a meeting scheduled for Thursday with the Jewish Federation of Greater Washington called off amid intense pressure from without and within the federation and after several of the invited rabbis said they would not attend.

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Likud MK Amichai Chikli speaks at the Federation of Local Authorities conference in Tel Aviv, December 7, 2022. (Tomer Neuberg/Flash90)

It was the third public meeting of a minister with US Jewish groups to be canceled in recent days.

Barkat reportedly canceled an appearance at Israel’s consulate in Boston scheduled for Thursday. Sources close to Barkat accused the consul general in Boston, Meron Reuben, of refusing to commit to preventing protesters from entering the conference, according to the Walla news site.

Science and Technology Minister Ofir Akunis pulled out of a Los Angeles event last week amid a protest at the venue.

Critics say the overhaul will sap the High Court of Justice of its power to act as a check and balance against parliament, dangerously eroding Israel’s democratic character and leaving the rights of minorities unprotected. Supporters say the legislation is needed to rein in what they see as an overly intrusive court system.

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