Israel And EAEU Edge Closer To A Free Trade Agreement

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Israeli Prime Minister Naftali Bennett’s had talks with Russian President Vladimir Putin on Friday, with discussions running over five hours. That meant the Israeli delegation stayed longer than originally intended, leaving for Israel after the Shabbat (Saturday). The meetings were held in Sochi, Russia’s Black Sea resort, with the Israeli prime minister’s office adding that the meeting was warm and positive, with the leaders focusing on the issues crucial in relations between the two countries and “addressed a range of significant issues in bilateral relations.” according to the statement.

A key part of this would have been dealing with the proposed Israel-Eurasian Economic Union (EAEU) free trade agreement, suggesting a deal may be announced soon. The EAEU includes Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Russia and represents a market of some 183 million with a per capita average income level higher than China’s.

Bilateral trade between Israel and exceeded US$5 billion in both 2018 and 2019 according to Jerusalem Affairs Minister Ze’ev Elkin, although it dipped 3.9% in 2020 due to the impact of covid. Bilateral trade between Israel and Armenia and Belarus can also be expected to increase.

Israeli exports to the region are mainly agricultural fruits and vegetables plus a growing electronics sector. Armenia, Belarus and Russia export petroleum, coal, fertilizers, and gemstones to Israel. Annualized trade growth between Russia and Israel has averaged nearly 5% per annum since 1995, while discussions have also taken place concerning a proposed Russian Special Economic Zone in the country.

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