Midnight Deadline Looms as Netanyahu Struggles to Form Coalition

Israeli Prime Minister Benjamin Netanyahu has until midnight to form a governing coalition after the surprise withdrawal of a former ally left him short of a majority.

Netanyahu’s Likud is in talks with the right-wing Jewish Home party, the last faction the premier needs to secure a parliamentary majority. If he can’t present a coalition to President Reuven Rivlin by the end of Wednesday, Isaac Herzog, whose Zionist Union has the second-biggest bloc, could get a chance to form a government.

Jewish Home is demanding that Likud grant it the justice ministry as part of its coalition agreement, a condition the premier has been unwilling to accept. Even with Jewish Home’s support, the premier would end up with a one-seat majority in parliament, making his coalition vulnerable to crises and complicating his task to pass on any controversial legislation.

“The demand that we appoint a justice minister from Jewish Home is one that goes beyond the red lines of the Likud,” said Tzipi Hotovely, a lawmaker from Netanyahu’s party. Hotovely, speaking on Channel Two television, said she was still sure that “by midnight today we will have a government.”

Netanyahu is struggling to form a stable coalition after Foreign Minister Avigdor Liberman resigned on Tuesday and said his Yisrael Beytenu party won’t join the government. The task is also complicated by by Netanyahu’s strained personal relationship with Jewish Home’s leader, Economy Minister Naftali Bennett, who once served as the prime minister’s chief-of-staff.

Bennett, whose party opposes Palestinian statehood, has also criticized Netanyahu for not building more in West Bank Jewish settlements.

Blinking First

“It’s a question of who blinks first, but at the end of the day Jewish Home will join with Likud,” said Abraham Diskin, professor emeritus of political science at the Hebrew University of Jerusalem. “Bennett has no interest in a real crisis that would lead either to new elections, or push Netanyahu to join with a left-wing party like Zionist Union.”

Israel’s benchmark TA-25 Index for stocks fell 0.8 percent on Tuesday, trimming its gains this year to 11 percent. The yield on the benchmark government bonds due 2024 rose nine basis points to 1.61 percent, according to data compiled by Bloomberg.

Netanyahu has offered to make Bennett education minister, and give Jewish Home the Agriculture Ministry and the Ministry of Culture and Sport, the Times of Israel website said.

Opposition chief Herzog said Tuesday that the Zionist Union won’t join a Netanyahu-led government if the prime minister fails to reach a deal with other parties.

“It’s now clear to everyone that we are talking about another government of national failure, one that will be weak and deadlocked,” Herzog said at a meeting of his party’s parliament members.

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