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Israel, Egypt to boost economic ties, step up bilateral trade to $700m
May 29, 2022
Economy Ministry says countries to develop commercial crossing as joint employment area, engage in R&D cooperation, and increase economic activity
Israel and Egypt are moving to strengthen economic ties and hope to reach $700 million in annual bilateral trade in the next three years, the Economy and Industry Ministry said Sunday.
Under a new proposed plan, the two countries are set to jointly develop the Nitzana crossing between them, where commercial trade is handled, as a regional logistics center and a joint employment area; engage in R&D cooperation; develop joint projects in the area of green energy; and increase the number of direct flights. The plan will also see Israel increase imports of food, fresh fish, and construction materials from Egypt and exports of agriculture solutions and technologies.
The two countries are targeting annual trade (excluding tourism and natural gas exports) at about $700 million by 2025, up from about $300 million in 2021, according to the ministry.
Most Israeli exports to Egypt are in the textile sector, with the rest in areas like chemicals, rubber and plastics and other materials. Israel imports agricultural and food products from Egypt, as well as chemicals, electrical machinery, rubber and plastics, and minerals and fuels, the ministry said.
The new plan will expose more Israeli industries to the Egyptian market and make development and infrastructure projects accessible to Israeli tech companies, the ministry added.
Economy and Industry Minister Orna Barbivai said the countries will work to upgrade the Nitzana crossing, “which will promote trade relations with Egypt, and create quality employment in the south [of Israel], alongside activity by Israeli companies in the Egyptian market, and lower the cost of living [in Israel] by importing food and cement.”
Israel and Egypt signed a peace agreement in 1979 but relations have been mostly frosty, thawing more recently in the past few years. The countries maintain close security ties and share security interests in the Gaza Strip as well as in Sinai and the eastern Mediterranean but most Egyptians reject ties with Israel. Cairo, like Jerusalem, sees Gaza’s Hamas rulers as a serious threat and has restricted crossings to and from the enclave.
In early 2020, Israel began exporting natural gas to Egypt, marking a historic moment for both countries.
The move came shortly after natural gas started flowing from the massive Leviathan gas field, and some seven years after Israel started pumping gas from the nearby Tamar field.
Leviathan, discovered 130 kilometers (81 miles) west of the Mediterranean port city Haifa in 2010, is estimated to hold 535 billion cubic meters (18.9 trillion cubic feet) of natural gas, along with 34.1 million barrels of condensate.
US-based Noble and Israel’s Delek, the consortium leading the development of the Leviathan and the smaller Tamar field, struck a $15 billion 10-year deal in 2019 with Egypt’s Dolphinus to supply 64 billion cubic meters (2.26 trillion cubic feet).