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Israel and Australia discuss free trade agreement, boosting trade relations

J-Wire | 29 October 2021

Israel and Australia discuss free trade agreement, boosting trade relations

by Aryeh Savir - TPS

Israel’s Minister of Economy and Industry Orna Barbivai met virtually on Wednesday with the Australian Minister of Trade, Tourism and Investment Dan Tehan to examine the viability of a Free Trade Agreement (FTA) between the countries, and to examine ways and tools to strengthen trade relations between Israel and Australia.

An FTA promotes the development of bilateral trade and economic cooperation between the two countries and reduces tariffs.

During the conversation, the two ministers agreed on preliminary talks as early as January, with a desire to create new initiatives that will serve as a lever for economic cooperation between the two countries.

The Ministry of Economy and Industry’s Foreign Trade Administration, entrusted with promoting and leading the processes for establishing Israel’s FTAs with countries and trade blocs around the world, estimates that an FTA between Australia and Israel will increase Israeli exports to Australia and increase trade between the countries.

Ohad Cohen, Head of the Foreign Trade Administration at the Ministry of Economy, stated that “Australia is a significant market for Israeli exports. A free trade agreement – if signed – could help Israeli companies compete in the Australian market and strengthen business ties between companies and corporations in the two countries.”

Israeli export of goods and business services to Australia in 2020 amounted to about $736 million, and imports amounted to about $325 million, and the total volume of trade is over $1 billion.

Israeli exports to Australia, most of which consist of products, software and high-tech technologies, and medical equipment, are five times higher compared to imports from Australia to Israel.

Most imports from Australia to Israel consist of agricultural produce.

The Foreign Trade Administration estimates that a significant portion of Israeli exports to Australia is made through third countries and that the volume of mutual trade between the two countries amounts to about $2 billion.

In the past year, a number of Israeli companies have won tenders on a significant scale in Australia, and Israel expects that these successes will be reflected in the coming years.

About 70% of Israel’s international trade takes place within the framework of FTAs.

In the past decade, seven free trade agreements have been signed or upgraded with countries such as South Korea, Colombia, Canada, and Ukraine. This doubles the seven agreements that were in force in 2009.

In addition, Israel is currently negotiating with a variety of other significant markets such as China, Vietnam, Russia, Belarus, Kazakhstan, Kyrgyzstan, Armenia and Guatemala.

 source: J-Wire