Israel, South Korea agree on terms of free-trade deal, sans West Bank, Golan

Israel and South Korea announce that long-delayed talks on a free-trade agreement have finally come to an end, potentially opening up the world’s 11th largest economy to more competitive Israeli exports and lowering prices for a huge array of South Korean imports, including consumer tech and household appliances.

A statement by Israel’s Economy Ministry reads: “In 2018, trade between Israel and South Korea amounted to approximately $2.5 billion, an almost 15% increase over 2017. It is anticipated that the free trade agreement will further increase bilateral trade. Upon the agreement’s taking effect, most Israeli exports to South Korea will be exempt from customs duties, including machinery and electrical equipment, mechanical devices, fertilizer, medical equipment, cosmetics, plastics, metals, fruit juices and wine. From the other side, customs duties will be lowered on South Korean goods imported into Israel such as automobiles and automobile parts, refrigerators, medical equipment, electronic components, toys and games, plastics and chemicals.”

The talks were stalled for years over South Korea’s demand not to include contentious areas controlled by Israel but not recognized as Israeli by the international community in the free-trade agreement. They included the West Bank and Golan Heights.

In a likely bid to demonstrate his government’s foreign policy and economic chops ahead of the September 17 election, Prime Minister Benjamin Netanyahu acceded to the South Korean demand, exempting those areas from the agreement and pushing officials on both sides to quickly finalize the trade deal.