"Treasury sees Dead Sea as a bathtub with minerals"

Environment Minister Gilar Erdan attacks the Finance Ministry's deal with Israel Chemicals on salt harvesting.

In a direct attack on the Ministry of Finance, Minister of Environmental Protection Gilad Erdan, said "For generations, the Ministry of Finance has had an aggressive and confrontational attitude toward other ministries; less than towards tycoons. The ministry looks at everything through profit lenses; in other words, it sees the Dead Sea as a bathtub with minerals the profits from which should be maximized."

"The Ministry of Finance's decision was wrong, and it did not take tourism and environmental interests into account," Erdan told the Knesset Finance Committee during a stormy discussion of the agreement the ministry signed with Israel Chemicals Ltd. (TASE: ICL) on the salt harvesting at the Dead Sea and higher royalties on potash sales.

Erdan added, "The Ministry of Finance has acted with a lack of transparency and a lack of understanding. When we come to discuss who will finance the damage, there was no justification to include royalties in the meetings. There should have been a Sheshinski 2 Committee. There should be a progressive tax based on production and environmental damage. I warn you: if production at pool 6 is increased, I'll demand that the agreement be reopened. There should have been a demand to increase public's share should later on."

Minister of Tourism Stas Misezhnikov told the Finance Committee, "The Dead Sea is a wasted area. It has medical tourism, patients with skin and breathing ailments, as well as tourism and workers committees. But people from Jerusalem and Tel Aviv simply don’t go there."

In an attack on Minister of Finance Yuval Steinitz, Misezhnikov said, "I am pleased that the structure that Erdan and I proposed was accepted over the objections of the Ministry of Finance. I, in contrast to those who suffer from ego mania and ego trips, have no problem sharing praise and giving credit."

Accountant General Michal Abadi-Boiangiu said, "In no way whatsoever did we trade commerce and the quality of the environment for money. I say this because these remarks have been said at this table. Ministers said that the money should be earmarked. The government set up a committee to rehabilitate the area. The government has not abandoned its responsibility for the Dead Sea, but there is no connection between the higher royalties and the rehabilitation of the Dead Sea. The Ministry of Finance has already said that this rehabilitation is important. So there is no further amount because there's a committee that is examining the amount."

Israel Chemicals VP infrastructures Noam Goldstein said, "We've acted responsibly. We put our hands deep into our pockets. We had alternatives. We could have asked for very prolonged arbitration proceedings. We now have to roll up our sleeves and get down to work on this very complicated project."

Published by Globes [online], Israel business news - www.globes-online.com - on January 10, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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