Israel and China participated in the first direct talks on a free-trade agreement at the end of March since November 2019 and the eighth round since 2016, Globes reported.
Talks between the two countries have stopped due to the beginning of the COVID-19 pandemic resulting in the lockdown.
The Ministry of Foreign Affairs of the People’s Republic of China confirmed that the talks between representatives from the two countries took place and that issues related to free trade were discussed, including the transportation of goods and customs procedures.
A source close to the talks told Globes that the two sides were “at an advanced stage of tying up loose ends” and that “the agreement between the two countries could be signed this year.”
China is Israel’s second-largest trading partner by country after the United States, with the value of trade increasing last year by 11.6% to $24.45 billion. Israel’s exports to China in 2022 were valued at $4.68 billion, second to the United States. (The European Union is Israel’s largest trading partner.)
The most recent free-trade agreement involving Israel was the United Arab Emirates.
It was signed on May 31, 2022—less than two years after the signing of the Abraham Accords in the fall of 2020—and went into force on April 1 of this year.
Before that, Israel signed a free-trade agreement with South Korea on May 12, 2021, which went into force on the first of this year.
Israel is also negotiating bilateral trade agreements with Abraham Accords partner Bahrain as well as Australia, India, Japan, Vietnam and the Eurasian Economic Union.
Amid the tension between the United States and China, Israel has had a long economic stance with the American nation in a free trade agreement since September 1, 1985.
Since 2022, Chinese imports that including Teslas manufactured in China increased by 276%. The deliveries of Chinese brands totaled 25,238 represented 8% of all deliveries to Israel.
China became the second-largest vehicle exporter around the world where they’ve exported over one million vehicles after Germany.
“The negotiation on a trade agreement with China are proceeding according to the original timetable,” said Israel’s Ministry of Industry, Trade, and Labor.
Chinese-made EVs have the led the deliveries of exports by brand and model in Israel.
Israeli Prime Minister Benjamin Netanyahu led the charge in the Chinese free trade relations making Beijing as Israel’s second-largest trading partner.
“In recent years, the establishment has moved,” said Assaf Orion, director of the Diane and Guilford Glazer Israel-China Policy Center at Tel Aviv’s Institute for National Security Studies. “It’s pretty obvious to see that we’re not in the same place where we used to be. Netanyahu saw a great opportunity in China in the last decade. He still sees the opportunity. But I think the whole world is now more balanced to the view that it’s not a pure opportunity, it’s not a pure danger – it’s an opportunity with some risks to manage.”
The U.S. relationship with China has hardened since President Joe Biden entered the White House in 2021.
Israeli-Chinese relations grew as China’s influence in the Middle East has grown. It’s believed that China and Israel’s honeymoon period is over despite incoming economic agreements.
Produced in association with Jewish News Syndicate