Privatization in Israel - Privatization Processes

Privatization Processes

The privatization processes in Israel intensified in 1986 following the intensified privatization in Britain in the 1980s. So far around 90 government companies and subsidiaries have been privatized in Israel, which produced for the country, between the years 1991 and 2003 – a revenue amount of 8,749 million U.S. dollars.

The privatization processes in Israel belong mainly to the following types:

• Gradual Sale: a gradual sale or dilution of the state’s holdings in the public body to the extent where the state would no longer have a significant holding of the body. A notable example for this is the gradual selling of the Israeli telecommunications provider "Bezeq" and the gradual selling of the Israeli banks, which were originally nationalized following the Israeli Bank stock crisis in 1983.
• One-time sale: A one-time sales or issuing all of the company’s shares in the stock exchange. This is the method of action which is most common amongst the smaller companies or when there is a single buyer.
• Franchises and Licenses: initiating privatization processes by means of outsourcing, transferring of franchise, privileges, etc., especially of certain services which are consumed by government bodies. Such an action is not considered privatization by the definition of the Israeli government.
• Disassembly: the disassembly of a governmental body completely due to lack of need of its existence or losses which were made due to the existence of a competitive market.

Many refer to the structural change which has happened in many of the kibbutzim in Israel "privatization of the kibbutzim", although this process does not in relate to privatization processes. The kibbutz is a private voluntary association and not a public association, and the changes which occur in it are not considered Privatization as it is described in this article.