Israel likes to boast of its shut ties with the Trump administration within the US, as evidenced for instance in President Trump being persuaded to hitch the assault on Iran. However within the US tariffs program, Israel has obtained no preferential remedy, not within the consequence and never within the negotiations that preceded it.
Virtually till the final minute, the Israeli authorities believed that the tariff on Israeli exports to the US could be 10%, in keeping with the provisional tariff imposed a couple of months in the past, which might have given Israel a bonus over different nations. That hope evaporated in a single day, with the announcement in Washington of the tariffs on every US buying and selling associate. To the nice disappointment of these accountable for the negotiations with the US – Prime Minister Benjamin Netanyahu’s financial adviser Prof. Avi Simhon, Minister of Finance Bezalel Smotrich, and Minister of Economic system and Trade Nir Barkat – the tariff on Israeli exports was set at 15%.
Not simply the ultimate quantity, but additionally the way in which wherein was set point out that the Individuals didn’t actually contemplate Israel of their calculations. Trump declared that nations with which the US has a commerce deficit that had not reached a brand new commerce settlement would mechanically have a 15% tariff imposed on them. Israel is a kind of nations. However why has no commerce settlement been signed between the 2 nations?
Israel supplied the US many commerce advantages within the preliminary discussions. In actual fact, nearly all the small print had been finalized. There have been no actual gaps between the nations, not less than not within the talks on the skilled stage. Signing a commerce settlement would have introduced Israel to the wished-for 10% tariff, however earlier than the signing stage, the Individuals instantly disappeared. There was no-one with whom to signal the settlement, Israeli sources say.
The negotiations had been in contrast to something Israel had identified to this point with the US – inconsistent, incoherent, and unclear.
Prime Minister Benjamin Netanyahu was the primary world chief to go to the White Home to debate tariffs with President Trump, after the latter introduced his world plan in April. Netanyahu promised in a dwell broadcast to the entire world that Israel would cancel all tariffs on US imports. The promise was not stored in full, due to stress by the Israeli farmers’ foyer, which demanded safety for native produce. However Israel went again to the Individuals with an much more beneficiant supply: the state would subsidize the acquisition of pricey wheat from the US.
The Individuals seized on the chance and pressed their Israeli colleagues to finalize shortly the association proposed by Minister of Agriculture Avi Dichter. The Ministry of Finance objected, however Netanyahu determined, and ordered compliance with the Individuals’ needs. In the long run, the settlement was not signed, and never due to the Israeli aspect.
Why, in the long run, did the US delay signature on an settlement that might have considerably diminished the tariff on Israeli exports? It could appear that the issues weren’t financial, and had been definitely not within the arms of the negotiating groups. In the long run, the tariffs program can be a software of overseas coverage, a lever that Trump is utilizing to stress governments world wide to come back into line with him on varied issues. In Israel’s case, essentially the most pressing context is Trump’s need to finish the struggle within the Gaza Strip and attain an settlement with Hamas on the return of Israeli hostages. That has nonetheless not occurred, and – related or not – neither has a commerce settlement.
There may be nonetheless hope that the image will change and that the tariff might be diminished in a while, when an settlement is signed. However as soon as the brand new tariffs come into power and are utilized to Israeli exporters, it will likely be more durable to reverse them.
The tariff might be 10% on the UK, 15% on the EU, South Korea and Japan, and 25% on India, as a penalty for what Trump sees as unfair commerce coverage and for Indian purchases of arms and vitality from Russia. Canada has additionally been penalized, with a 35% tariff.
A spokesperson for the Ministry of Finance mentioned, “The tariff set by the US for Israel is on the decrease price for nations with which the US has a commerce deficit, and is decrease than the speed set for Israel on April 2 (17%). Israel’s inclusion on this group displays the optimistic dialogue between Israel and the US administration. These talks proceed with a view to reaching a complete, improved settlement.”
Revealed by Globes, Israel enterprise information – en.globes.co.il – on August 1, 2025.
© Copyright of Globes Writer Itonut (1983) Ltd., 2025.
