Trade between Israel and the US continues to make great strides, as the US remains Israel’s most important trade partner.
In 2016, Israeli trade with the US grew to $20.3 billion from $19.8 billion in 2015, and recent statistics from the Foreign Trade Administration at the Israeli Ministry of Economy and Industry show that the US continues to be Israel’s most important trade partner.
Israel signed a free-trade agreement with the US in 1985, the first such free-trade agreement ever signed by the US, and the second one signed by Israel. The first trade-agreement signed by Israel was with the European Union (EU).
In 2016, trade of goods between the US and Israel reached $27 billion, $17.6 billion of which was Israeli exports to the US and $9.4 billion in imports from the US to Israel.
Per capita, Israel is the US’s 12th largest export recipient, and despite its small size, is overall the 25th largest importer of American goods.
Trade of goods constitutes some 50 percent of economic activity between the two countries: trading in services constitutes 19 percent; and investments make up the additional 31 percent.
Israeli export of goods to the US, not including the diamond industry, is concentrated in two main sectors: chemicals, including pharmaceutical products, and electronic equipment. These two sectors constitute more than 50 percent of the total export of goods from Israel to the US.
Imports from the US come mainly from the following sectors: electronic equipment, transportation equipment (mainly aviation), and chemicals. These constitute more than 50 percent of imports from the US to Israel.
In 2016, some 5,000 Israeli companies exported products and services to the US.
Massive US Investments in Israeli Ingenuity
A significant number of American companies have production facilities in Israel, including Intel, HP, Applied Materials, Perigo, Unilever, and others.
Many large multinational corporations like Microsoft, Intel, Apple, Google, Motorola, IBM, and others have established R&D centers in Israel.
In 2014, American investments in Israel reached $9.7 billion and Israeli investments in the US reached $6.1 billion.
There are a number of joint research and development channels between the two nations, including the BIRD Foundation established by the US Government and Israel in 1977. Some $110 million in joint investments were made by the foundation. It is the largest binational industrial R&D foundation established by the Israeli government.
Since its establishment, the fund has supported more than 800 joint R&D projects and has allotted grants totaling $400 million. The products developed as part of these joint projects have brought in over $4 billion in revenues and have created thousands of workplaces in the US.
In addition, the United States-Israel Binational Science Fund (BSF) supports basic research and the Binational Agricultural Research and Development Fund (BARD Fund) supports joint research on agricultural developments.
The Israeli Ministry of Economy and Industry has five trade missions in the US: New York, Washington, Chicago, Houston, and San Francisco. These support and promote Israeli exporters and foster investments in Israel.
In 2016, the Israeli Ministry of Economy and Industry, through the efforts of its network of trade representatives, organized thousands of meetings for Israeli companies, whether at national pavilions at exhibitions such as RSA, HIMSS, CES, PMA, and the Israel Dealmakers Summit or by organizing dozens of delegations of companies to the US in various sectors such as: water, energy, cyber-security, medical equipment, Ed-Tech, FinTech, food and more.
Going forward, the “US has been, is and will continue to be Israel’s most important trade partner,” said Economy Minister Eli Cohen.
By: Max Gelber, United with Israel
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Source: United with Israel