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Israel-China ties will strengthen after trade deal

Wednesday, December 21, 2022

Significance

Israel’s economic ties with China have flourished over the last decade. China is now Israel’s third-largest trade partner behind the EU and the United States. Since the two countries started FTA talks in 2016, the value of bilateral trade has grown from USD11.0bn to USD18.2bn in 2021.

Impacts

  • China is set overtake the United States as Israel’s second-largest trade partner as trade in goods continues to grow.
  • Progress on the FTA will lead to further lobbying by Washington to restrict Israel’s economic ties with China.
  • Netanyahu is a proponent of closer relations with China and will look to deepen economic ties.
  • China’s initial success at making inroads into sensitive Israeli industries such as critical infrastructure and technology will slow.
  • An FTA with Israel would be China’s first in the Middle East and could energise efforts to reach similar deals with other regional states.

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