MercoPress. South Atlantic News Agency

Mercosur/Israel trade deal comes into effect following Argentina’s signature

Israel’s Deputy Director of the Industry, Trade and Labour Ministry Boaz Hirsch

A free trade agreement between Israel and Argentina is set to come into effect on September 9, the Israeli Industry, Trade and Labour Ministry announced this week.

The arrangement between Israel and Argentina completes the free trade deal Israel signed with the Mercosur bloc of which Argentina is part, but did not initially approve, although it went into effect on January 1, 2010.

With Argentina finally signing the agreement, Israel can now freely trade with the bloc with no restrictions.

In 2010, Israeli companies did 1.8 billion dollars of business with Mercosur countries, but only about 130 million with Argentina, because of high tariffs on Israeli goods there. With the expiration of the tariffs prescribed by the free trade agreement, Israeli officials are very optimistic that trade with the bloc will increase substantially.

It should be noted that Israel is the only country outside of Latin America to have such an agreement with the Mercosur countries.

Israel’s Deputy Director of the Industry, Trade and Labour Ministry Boaz Hirsch said that the agreement would “give Israeli companies a unique opportunity to reach markets in Latin America. This agreement is also important in that it increases ties between Israel and the countries in the bloc”.

Hirsch recalled that Israel has a long tradition as a trailblazer in free trade agreements and nearly 65% of Israel's exports are to countries with which it has free trade agreements.

Israel was the first country to sign an FTA with the United States, and was the first country to have one with both the US and European Union.

“The FTA with Israel is Mercosur first; Mercosur bloc is the fifth largest market in the world and numerous countries have tried to negotiate deals with the bloc, but have so far failed” said Hirsch.