THREE newly signed agreements with Israel are expected to enhance business-to-business (B2B) interaction between Israel and the Philippines, bringing bilateral trade beyond pre-pandemic levels, the Israeli embassy said.
“The challenge is to show to both sides that the Philippines is an interesting market which brings interesting opportunities,” Israel Ambassador to the Philippines Ilan Fluss told reporters on Friday.
“This is done not only with figures, statistics and by sending e-mails, you have to have interaction,” he added. “Our plan now is to work more on the interaction between business to business, the private sector.”
The ambassador noted that Israel is currently searching for new partners since it depends on exports as a small country. “We always look abroad,” he added, noting that its traditional markets include the United States and Europe, with the recent addition of China and the United Arab Emirates.
Israel Embassy Economic Attaché and Head of the Economic Mission Tomer Heyvi said there is great potential for trade and investment in the Philippines. “We do expect it to grow in the coming years.”
Israel is targeting more electronics imports from the Philippines, as well as food, agriculture-based products, and consumer goods such as garments and textiles.
However, more support must be given to the private sector to achieve its potential, Mr. Fluss said. “We are not tapping the potential, this is the main message, and it is up to us to help the private sector to fulfill this potential.”
The three agreements signed last week included an investment promotion and protection agreement (IPPA), a memorandum of understanding (MoU) forming the Joint Economic Commission (JEC), and a MoU seeking to strengthen cooperation with the Israel Innovation Authority.
The IPPA, which needs ratification from Congress, provides the framework for a closer investment relationship between Israel and the Philippines. It also specifies investment protection elements such as national treatment, most favored nation treatment, free transfers, rules-based expropriation and compensation, and investor-state dispute settlement.
The JEC seeks to intensify the bilateral economic cooperation and linkages, enhance the current state of trade and investment, and address trade barriers.
Cooperation with the Israel Innovation Authority will take place in research and development and commercial relations.
Bilateral trade in goods between the Philippines and Israel peaked in 2019 at $338 million. It dropped in 2020 due to the pandemic, but rebounded to $323 million in 2021.
Mr. Heyvi said Israeli exports to Philippines are still “relatively low, consisting of only 0.3% of Israel’s total exports.
“But I’m sure that with the two major agreements, the IPPA and the joint committee, we (have) planted the seeds for better economic and trade relations between the two countries,” he added.
Once further growth has been attained, both countries can begin negotiations on a free trade agreement, Mr. Heyvi said. — Alyssa Nicole O. Tan