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Israel now has the highest rate of car theft in the world, according to the Israel Insurance Association. The chart above shows the number of cars stolen each year since 1993 (vertical bars, left axis), along with the cost to insurance companies (green line, right axis).
The increase in car thefts was fueled by the Israel-PLO accords, which were signed in September 1993 and took effect in May 1994. According to the London-based Sunday Telegraph (5 July 1998), Palestinian and Israeli car thieves cooperate, and Israeli police say many of the cars end up in Palestinian-controlled areas. According to one Palestinian car thief, "I can have any car you want within a few hours, I'll just call the Israelis I work with."
"The problem of stolen cars has increased to a real crisis," said Israel Insurance Association spokesman Shmuel Malkis. The Israeli cabinet has even approved a plan to fight the problem. "This is a blight on the country," said Public Security Minister Avigdor Kahalani.
Under the 1993 Israel-PLO accords, the Palestinian Authority was granted jurisdiction over parts of the West Bank and Gaza, putting those areas off-limits to Israeli police. Criminals soon began moving stolen cars into the self-rule areas to evade the Israeli authorities.
Israeli officials believe their Palestinian Authority counterparts are ignoring the problem, pointing to cases in which Palestinian officials have been found driving stolen cars.
The statistics in the above chart were reported by Israeli newspaper Hatzofe (13 March 1998), based on figures from the Israel Insurance Association.
In 1993, some 23,000 cars were stolen, 40 percent of which were recovered, costing insurance companies about 950 million Israeli shekels, or about $260 million. By 1997, nearly 46,000 cars were stolen, but only 20 percent were recovered, with costs totalling nearly 2.5 billion shekels. While the number of thefts has risen rapidly, the number of vehicles recovered has stayed about even.
Over the five years (1993-97), over 166,000 cars were stolen, 71 percent of which were never found. Costs totaled almost 8 billion shekels. These cost estimates do not appear to include secondary costs to the economy, such as the 28 percent rise in insurance premiums and increased spending on vehicle security devices.
Overall, 30 out of every thousand vehicles in Israel will be stolen sooner or later, compared with 8 to 12 per thousand in the United States and western Europe.
The Israel-PLO agreements took effect in May 1994, with the Palestinian Authority taking control of the Gaza and Jericho areas. A stolen car industry then began to develop in Jericho. In December 1995, the main Arab cities in Judea and Samaria (the West Bank) were all turned over to the PA, except for Hebron, which followed suit in January 1997. By 1997, car thefts had doubled since 1993, and the number of vehicles never recovered had increased by two and a half times.