The list of putative candidates for Governor of the Bank of Israel is drying up. After the withdrawal of Prof. Leo Leiderman, 48 hours after his appointment to the post was announced, there is sense of shock, and those surrounding Prime Minister Benjamin Netanyahu realize that it will now be hard to find a worthy, self-respecting candidate who will be prepared to undergo the Via Dolorosa of the Turkel Committee.
Nevertheless, the prime minister is determined to appoint a new central bank governor as soon as possible, Sources close to him believe that by the end of this week a candidate will be selected and will be in the throes of the Turkel Committee's examination.
The weekend's events will not be forgotten quickly, however, and already a "Frenkel-Leiderman effect" is detectable. Sources inform "Globes" that two prominent economists have turned down Netanyahu's approaches. One of them is none other than Prof. Eugene Kandel, who heads the National Economic Council, and is in effect the prime minister's economic adviser.
It should be stressed that even on the first day that the race for the governorship of the Bank of Israel began, Kandel sent out a press release declaring that he was not a candidate for the post and did not seek it. That Kandel ruled himself out from the start is one of the great enigmas of the race, since, on paper, he has every qualification for the job. It is believed that the reason behind his refusal is that he is not prepared to receive greater public exposure, beyond that which arises from his current position.
So, despite the sense of obligation that Kandel feels towards Netanyahu, "stage fright" is apparently the overriding factor, especially after the withdrawals of Leiderman and Jacob Frenkel. As mentioned, the position was offered to another economist, believed to be a senior figure at the Bank of Israel.
"Globes" has learned that, despite the pressure being exerted on Netanyahu, Dr. Karnit Flug, deputy governor of the Bank of Israel, and currently acting governor, who was considered the leading candidate at every stage, will not be made governor. The prime minister does not hold her in high regard, and has refused determinedly, even somewhat obsessively, to appoint her, and he is not seen relenting now.
Published by Globes [online], Israel business news - www.globes-online.com - on August 4, 2013
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