Records impressive 70% Year-over-Year growth rate
By THEPHILBIZNEWS STAFF
Amid the disruption created by the pandemic that literally put the whole world at a standstill situation, it is interesting to note that the Philippines and Israel’s bilateral trade relations marked an outstanding performance as we deal in the post-pandemic world.
This year will mark the 65th anniversary of the bilateral diplomatic relations of the State of Israel and the Republic of the Philippines, which was established back in 1958. Since then, both countries managed to develop and maintain strong and friendly relations, relaying on extensive cooperation in the areas of agriculture, defense, labor, tourism, technology & innovation as well as in trade and investments.
An evidence to the tightening of Israel-Philippines relations, is the growing volume of the bilateral trade, reaching its peak in 2022 with a total of 534 Million US Dollars’ worth of goods. This an impressive 70% Year-Over-Year growth rate, driven by the rebounding of both the Israeli and Philippine economies in 2022 following the Covid-19 crisis.
Tomer Heyvi, Economic Counselor and Head of the Israeli Economic Mission to the Philippines mentioned that “2022 was indeed a track record year of Israel-Philippines bilateral trade relations with a remarkable 70% YoY growth rate, but the potential is much higher and yet to be fulfilled. In recent few years, we see a growing demand in the Philippines for Israeli products and technologies in various sectors such as agriculture, water, homeland security, cybersecurity, ICT and connectivity, medical device and healthcare, among others. As a consequence, the Foreign Trade Administration within the Ministry of Economy and Industry of Israel, decided to establish an Economic Mission in the Philippines to further boost the commercial ties between Israeli and Filipino companies.
Tomer added that “at the same time, there is also a growing demand in Israel for products and services from the Philippines such as electronics, agriculture produce among other products, as well as to BPO services. This is represented in the consecutive growth of our imports from the Philippines in both 2021 and 2022.”
According to the Central Bureau of Statistics of Israel, the export of goods from Israel to the Philippines in 2022 grew by 94% compared to the previous year, and reached 340 Million US Dollars’ worth of goods.
Machinery and Electronic Equipment were the top exported category with a 54% share valued at 183 Million US Dollars. This category included semiconductors, telephone sets, electronic integrated circuits, automatic vending machines, valves and data processing equipment. The next category was Transportation Equipment with a 30% share, mainly including aerospace and maritime equipment for the Philippine defense industry. Base Metals accounted for 9% of the total Israeli exports while Optical Equipment, mainly referring to optical fiber, medical appliances and various industrial tools accounted for 5.6%. Chemical Products, mainly referring to fertilizers, organic chemicals, cosmetics and pharmaceutical products accounted for 2.6% while Rubber & Plastics, at 2.2% mainly refers to industrial agriculture products. Finally, Agriculture products and Foodstuff as fruit juice, sauces, sugar and edible vegetables, accounted for about 1.6% only.
The Israeli imports from Philippines in 2022 grew by 39% comparing to last year, reaching 193 Million US Dollars’ worth of goods. The top category was Machinery and Electronic Equipment, accounting for 83% of the total imports, including electronic integrated circuits, printing machinery, engine and motors, telephone sets, vacuum cleaners and water heaters. Next was the Agriculture products and Foodstuff with a 6.1% share, mainly including edible fruits and nuts (mainly coconut), fruit juice, baked goods, tapioca and fish products. Textile and Footwear accounted for 5.3%, mainly included footwear, bags, clothing and clothing accessories, while Optical & Medical accounted for 3.7% mainly referring to gas and water meters, optical fibers measuring instruments and medical instruments and appliances.
The above trade statistics are limited to trade in goods and do not include trade in business services such as cybersecurity services and enterprise solutions exported from Israel versus BPO services imported from the Philippines. Therefore, the estimated bilateral trade of Israel and the Philippines in both goods and services in expected to be higher than 534 Million US Dollars.
The growing bilateral trade relations of Israel and the Philippines are also reflected in the closer economic dialogue between the two countries.
In June 2022, few important agreements and MOUs were signed during the visit of former DTI Secretary Mr. Ramon Lopez to Israel. Among them was the Investment Promotion and Protection Agreement, expected to enter into force within this year. Another one is the MOU between the Department of Trade and Industry and the Israel Ministry of Economy and Industry on Economic Cooperation and the establishment of a Joint Economic Commission. The first JEC is expected to take place this year and further promote the bilateral trade relations of Israel and the Philippines.
