The agreement on a free trade area between Israel and Ukraine entered into force

The agreement on a free trade area between Israel and Ukraine entered into force on January 1, 2021. The agreement was signed by former Minister of Economy and Industry Eli Cohen and his Ukrainian counterpart last year and underwent ratification process in both countries.
The agreement includes tariff reductions on both Israeli exports to Ukraine and imports of products to Israel, and will improve the mutual approach in the field of goods of the two countries. The negotiations on the agreement were led by the Foreign Trade Administration in the Ministry of Economy and Industry, in collaboration with the Ministries of Foreign Affairs, Agriculture and Justice as well as the Customs Administration.
Upon the entry into force of the agreement, a variety of products from Israel will receive a customs exemption on exports to Ukraine. Products include plastic and rubber products, machinery, medical equipment, chemicals and fruits and vegetables such as dates, avocados, persimmons and fruit products. The agreement is also expected to lower the tariffs on products imported from Ukraine, including: wheat and various agricultural products, fish, processed foods, various types of oils, iron, steel and other raw materials intended for industry, thus helping to reduce the cost of living in Israel. Lowering tariffs on agricultural products and processed foods is expected to lead to increased imports and thus constitute an important line for the Israeli consumer.
Ukraine is an important trading partner for Israel. According to data from the Ministry of Economy and Industry, exports from Israel to Ukraine in 2019 amounted to about $ 162 million, and the total volume of trade in 2019 was about $ 857 million.
The trade agreement is of great importance to the relations of the countries. Its entry into force will promote bilateral economic relations and is expected to increase the volume of trade between the countries.
The main industries exporting goods from Israel to Ukraine are chemicals (63%), plastics and rubber (10%) and machinery (8%).
The main imports of goods from Ukraine to Israel are agricultural products and food products (74%), base metals (16%) and machinery (4%).
Minister of Economy and Industry Amir Peretz stated: "Foreign Trade Administration in the Ministry of Economy and Industry initiates and negotiates new trade agreements of the State of Israel in order to promote local industry in world markets while giving competitive advantage to Israeli manufacturers, lowering imports to Israel and reducing cost of living and regular maintenance. Of these agreements and thus addresses trade barriers to exports for Israeli companies. The trade agreement reflects, among other things, the ministry's policy of helping to diversify exports and opening new markets for Israeli industry, thus helping to strengthen Israeli exports and the economy during this challenging period. Growing and expanding exports are part of the significant growth engines of the Israeli economy that will help emerge from the corona crisis.
Today, about 70% of the international trade of the State of Israel takes place within the framework of free trade agreements. Ukraine is a good friend of Israel and the strengthening of economic relations with it is a necessary step. The signing of the free trade agreement between Israel and Ukraine will open up additional opportunities for Israeli exports in this market and will also be a foothold for Israeli exporters in the Eastern European market. "