Asia to Surpass U.S. as Israel’s No. 2 Export Target After Europe

2014 is likely to be the first year in which Israeli trade with Asia will surpass Israeli trade with the United States, with 21% of Israel’s trade projected to be with the East this year, according to Israel’s Economy Ministry.

The Times of Israel reports:

The change in the destination of Israeli exports from West to East is due to a combination of forces, according to the Israel Export Institute. In a 2012 report on Israeli export activity, officials said that, due to the lingering effects of the recession in the US and Europe, Israeli companies developed new markets for their products and services in the Far East, particularly India and China, but also Taiwan, Singapore, South Korea and Vietnam. …

If the Economy Ministry is right, 2014 will be the first time Israel sends more products to Asia than to the US on an annualized basis. Israel’s largest trading partners in Asia are China and India, respectively.

The European Union, with 32% of Israel’s trade remains Israel’s largest trading partner, and will likely remain so for the near future.

According to the  Israel Trade Mission in China, nearly 300 Israeli companies are doing business there.

One of them, Solbar, has even won an award for its management practices from the Chinese government, a rare achievement for a foreign company in China.

In addition, Asian investors are starting to show an interest in trade with Israel.  According to the report, Israel’s Catalyst Equity Management and Hong Kong-based Everbright Limited Investments have established a fund that invests in Israeli companies that have commercial ties with China.

In related news, a leading Hong Kong investor, Li Ka Shing, is planning to invest $10 million in Tipa, an Israeli company that makes biodegradable packaging. Previously Li had invested in Waze, which was bought by Google for $1.3 billion, and Onavo, which was bought by Facebook for over $100 million.

[Photo: Israel-Asia Center / YouTube ]