Israel

Under the United States-Israel Free Trade Area Agreement (FTA), signed in 1985, the United States and Israel agreed to implement phased tariff reductions culminating in the complete elimination of duties on all products by January 1, 1995. Most tariffs between the United States and Israel have been eliminated as agreed.  To address remaining tariffs affecting agricultural trade, the United States and Israel signed an Agreement on Trade in Agricultural Products (ATAP) in 1996, establishing a program of gradual and steady market access liberalization for food and agricultural products, which is currently effective through December 31, 2009.

Trade in Goods

The U.S. goods trade deficit with Israel was $7.8 billion in 2008, an increase of $72 million from 2007. U.S. goods exports in 2008 were $14.5 billion, up 11.3 percent from the previous year. Corresponding U.S. imports from Israel were $22.3 billion, up 7.4 percent. Israel is currently the 20th largest export market for U.S. goods.

Trade in Services

U.S. exports of private commercial services (i.e., excluding military and government) to Israel were $3.4 billion in 2007 (latest data available), and U.S. imports were $3.1 billion. Sales of services in Israel by majority U.S.-owned affiliates were $1.1 billion in 2005 (latest data available), while sales of services in the United States by majority Israel-owned firms were $1.5 billion.

Investment

The stock of U.S. foreign direct investment (FDI) in Israel was $10.1 billion in 2007 (latest data

available), up from $9.4 billion in 2005. U.S. FDI in Israel is concentrated largely in the manufacturing and information sectors.