Trade Tech – Trade Tuesday looks at the UK/Israel trade talks

Last week, the UK and Israeli governments concluded their second round of trade talks, marking another step towards deepening trade links with a key economy in the Middle East. The 2030 roadmap for UK-Israel bilateral relations signed in March focuses on tech, research development, security, health and climate. With a marked increase in the value of the trading relationship with Israel - up 42% in 2022 compared with 2021 and currently valued at £7.2 billion - this trading relationship is therefore of increasing interest to the business community in the UK.  

How could this upcoming trade deal impact business and what are the positions of the political parties?  

For the Conservatives, the tech innovation industry has been a central focus, and they are keen to display this as a thriving area of trade policy negotiations. The Minister for International Trade, Nigel Huddleston, stated in the Commons last week that a trade deal should focus on building existing arrangements around innovation in the tech sector. An example of this is the UK and the Israel Innovation Authority. This agreement funds up to £6 million worth of collaborations championing UK and Israeli businesses to develop new innovative products and aims to boost technological trade. 

For Labour the focus while the party remains in opposition is on setting out its stall for its broad trade policy. Shadow Foreign Secretary David Lammy recently produced a pamphlet entitled ‘Britain Reconnected[FR1] ’, which outlined the philosophy behind the party’s trade policy. Lammy said that under Labour the UK will work with other countries where their interests overlap while simultaneously holding governments to account on points of disagreement.

For Labour, forming a robust relationship with Israel is a high priority. Labour MP and Chair of Labour Friends of Israel Steve McCabe has emphasised Labour’s desire to improve relations with Israel, stating that the party supports the trade deal pursued by the Conservatives, noting that Israeli companies provide one in seven NHS drugs contributing to a trading relationship worth £7 billion.

The response to the negotiations has demonstrated that there will be a great deal of cross-parliamentary support for a trade deal with Israel. It will be interesting to view how this trade deal progresses in the coming year, as both parties seek to sharpen up policies in preparation for next year's general election.