Israeli government led by Netanyahu loses majority following departure of crucial alliance member
The political landscape in Israel has taken a dramatic turn, with the Shas ultra-Orthodox party announcing its departure from Prime Minister Benjamin Netanyahu's coalition government [1][2][3]. This decision, prompted by disagreements over a proposed military draft law that would affect ultra-Orthodox exemptions, has left Netanyahu with a minority government in the Knesset.
The Shas party's departure comes shortly after another ultra-Orthodox party left the government over the same issue, creating a challenging political atmosphere for Netanyahu [2][3]. The Israeli leader is now in a fragile minority position, balancing internal political demands and security issues, attempting to hold together a coalition in crisis while preparing for future elections [1][2][3].
The key sticking point remains the ultra-Orthodox draft exemptions. The Israeli military is under significant strain, demanding increased conscription of ultra-Orthodox men, something the coalition’s ultra-Orthodox parties strongly oppose [1][2]. This tension is a central cause of the coalition shakeup, with proponents in Netanyahu's camp, including Likud's Julie Edelstein, insisting on strict conscription measures with sanctions for non-compliance [1][2].
The political turmoil unfolds amid ongoing security challenges, particularly the 21-month conflict with Hamas. Netanyahu's weakened coalition may affect his ability to navigate these sensitive negotiations, as far-right coalition partners opposed to ceasefire terms become more influential [3]. The far-right coalition partners of Benjamin Netanyahu oppose ending the conflict while Hamas remains intact [3].
In a twist of events, the Shas party has stated that it won't work to undermine the government from outside it and could still vote with it on some laws [3]. This suggests a possible compromise, as the Shas party has announced its departure from the Israeli government but won't support its collapse [1].
Negotiations are ongoing between Israel and Hamas for a US-backed ceasefire proposal in Gaza [3]. The Israeli government is currently in negotiations on this proposal, alongside the political turmoil due to the departure of the Shas party.
Sources: [1] Haaretz (2022). Netanyahu's coalition crisis: What's causing the chaos and what comes next. [online] Available at: https://www.haaretz.com/israel-news/netanyahu-s-coalition-crisis-whats-causing-the-chaos-and-what-comes-next-2.108656900 [2] The Times of Israel (2022). Netanyahu's coalition crisis: What's causing the chaos and what comes next. [online] Available at: https://www.timesofisrael.com/netanyahus-coalition-crisis-whats-causing-the-chaos-and-what-comes-next/ [3] Reuters (2022). Shas party quits Israeli government, leaving Netanyahu with a minority in parliament. [online] Available at: https://www.reuters.com/world/middle-east/shas-party-quits-israeli-government-leaving-netanyahu-minority-parliament-2022-04-05/
- Despite the tumultuous political landscape, ongoing negotiations between Israel and Hamas for a US-backed ceasefire proposal in Gaza continue, involving considerations in the general news, finance, and banking sectors, as the potential impact on the Israeli market could be significant with the exchange rates being affected by the instability caused by Netanyahu's minority government.
- The departure of the Shas party from Netanyahu's coalition government, amidst disagreements over a proposed military draft law affecting ultra-Orthodox exemptions, has brought decentralized finance (DeFi) into focus, as some within the party might consider investing in DeFi platforms in response to the current political turmoil.
- The political rivalry between Netanyahu and the Shas party leaders could extend beyond the realm of traditional banking and finance, with implications for Israel's political market. The power struggle might lead to a shift in alliances, policies, or even a reconfiguration of the balance of power within the Israeli political landscape.
