Dizengoff Street in Tel Aviv, once a bustling hub of activity and commerce, is now a shadow of its former self. The vibrant street, known for its lively atmosphere and high foot traffic, has become eerily quiet amidst the ongoing Israel-Hamas conflict. As tourism plummets and businesses struggle, Dizengoff Street stands as a stark symbol of the broader economic impact of war.
The War’s Impact on Tel Aviv’s Dizengoff Street
The conflict, which erupted in October, has led to a drastic reduction in tourism—down by a staggering 75% compared to the previous year. The result? Business owners on Dizengoff Street are grappling with a severe downturn. Shops and restaurants that once thrived are now grappling with empty tables, closed storefronts, and a looming sense of uncertainty.
Nirit Aharoni, a sales associate at Shani Kalay Jewelry, describes the current situation as “catastrophic.” She notes, “Tourists aren’t coming, and locals don’t have the means to spend. They’re worried about what tomorrow will bring.”
The Shrinking Foot Traffic and Rising Costs
Dizengoff Street, typically packed with shoppers and diners, now presents a stark contrast. The bustling atmosphere has given way to rows of shuttered doors and “out of business” signs. Business owners are not just losing sales; they’re facing higher operating costs amidst dwindling revenues.
- Sales have dropped significantly.
- Operating costs continue to rise, including rent and utilities.
- Tourist numbers are drastically down, exacerbating the issue.
Shalev Shoshan, co-owner of Fiocco Nero, a men’s shoe store, shares his frustration: “Not only am I not making money, but I’m losing. It’s a situation I’ve never faced before.”
The Broader Economic Fallout
The broader economic landscape mirrors the struggles on Dizengoff Street. The Central Bureau of Statistics reports a 75% decline in tourism for the first half of 2024, with visitor numbers plummeting from 2.1 million in 2023 to just 501,100.
CofaceBDI, a business information company, predicts a grim outlook. They estimate that up to 60,000 businesses might close by the end of 2024, with 46,000 already shut since the war began. The dire conditions are attributed to:
- Fear of escalation and ongoing uncertainty.
- Staff shortages and low demand.
- Increased financing needs and procurement costs.
Government Response and Its Shortcomings
In response to the crisis, the Israeli government has introduced a compensation aid package. This includes:
- Grants for businesses suffering indirect damage.
- A salary reimbursement programme.
- Relief measures for employees on unpaid leave.
However, many business owners feel this aid is insufficient. A survey by CofaceBDI revealed that over 50% of managers received inadequate support, with only 3% satisfied with the assistance provided.
Shoshan laments, “Unlike during COVID-19, where we had more support, now there’s nothing. The government isn’t doing enough.”
The Strain on Small Businesses
Small businesses, particularly those with fewer than five employees, are the most vulnerable. They face immediate financing challenges and find it harder to secure critical funds. 35,000 small businesses have already closed since the conflict began, underscoring their fragility.
Ariel Oronovitch, owner of Ariel Pax Beauty Studio, adds, “More places have closed during the war than before. It’s tough, but you have to stay positive.”
The Uncertain Future
As Dizengoff Street continues to struggle, the outlook remains uncertain. With businesses closing and the economic impact of the conflict becoming more pronounced, many fear the worst is yet to come.
Aharoni warns, “If things continue this way, we might see even more closures.”
Conclusion
The current state of Dizengoff Street is a poignant reminder of the far-reaching consequences of conflict. As businesses fight to survive and the local economy reels, the once-bustling street serves as a microcosm of the broader challenges facing Tel Aviv and Israel.
Photo credit: The Times of Israel
