Canada and Israel Form New Free-Trade Agreement

Canada and Israel have long enjoyed a mutually beneficial trade arrangement. That relationship strengthened even further on Tuesday when the two nations announced a new free-trade agreement expected to facilitate the import of fish and baked goods to Israel and the export of farm products and wine. The new agreement has the formal title Canadian-Israel Free Trade Agreement (CIFTA).

Canada and Israel have long enjoyed a mutually beneficial trade arrangement. That relationship strengthened even further on Tuesday when the two nations announced a new free-trade agreement expected to facilitate the import of fish and baked goods to Israel and the export of farm products and wine. The new agreement has the formal title Canadian-Israel Free Trade Agreement (CIFTA).

Canada and Israel had a prior treaty dating back to 1997. The CIFTA treaty replaces that agreement which, over its duration, caused trade between the two nations to rise as high as $1.6 billion last year. Prior to the 1997 treaty, trade between Canada and Israel amounted to a mere $500 million.

According to a report by Haaretz, the new negotiated agreement will still need to be ratified by each nation’s parliament before it will take effect. Still, the news of the agreement is expected to cause a further boost in trade, and lead to long term financial benefits to both nations.

When asked about the new treaty, Canadian Prime Minister Stephen Harper said Tuesday that “Israel is a priority market for Canada and holds great potential for Canadian companies in a variety of sectors…An expanded and modernized free trade agreement will lead to a strengthened bilateral relationship as well as an increase in jobs and opportunities for Canadians and Israelis alike.”

Israel’s Prime Minister, Benjamin Netanyahu, echoed these sentiments, calling Canada “one of Israel’s closest friends,” and commenting that the new agreement would be advantageous for both countries.

CIFTA will reduce customs on agricultural products and other food items. Additionally, it will increase transparency and reduce bureaucracy.

In announcing the new agreement, the Canadian government issued a statement to the media. According to the statement, “Canada values its long-standing relationship with Israel, which is based on shared values, common interests and strong political, economic, cultural and social ties. An expanded and modernized agreement will further enhance Canada’s visibility and terms of access in the Israeli market, while supporting the close bilateral relationship more generally…Key opportunities for Canadian companies exist in sectors such as defense, information and communications technology, life sciences, sustainable technologies, agriculture and agri-food, and fish and seafood.”

The CIFTA agreement represents just one of several such free-trade treaties Israel is currently pursuing. According to Ohad Cohen, the head of foreign trade at the Israeli Economy Ministry, “Currently more than 60% of Israel’s foreign trade falls under free-trade agreements. Israel is now in negotiations with India, Panama, and Ukraine, and is about to begin negotiations with other countries in Asia.”