Canadian Jewish Political Affairs Committee
Canada-Israel Relations

Business Development Mission to the Middle East

Canada-Israel Relations

Canada and Israel enjoy a friendly and maturing bilateral relationship. It is founded on Canada’s strong support for Israel since its inception in 1948 and our commitment to Israel’s well-being as an independent state in the Middle East.

For many years, Canada and Israel have had excellent relations based on shared values and strong bonds of friendship and culture. The Canadian Jewish community is estimated at about 350 000. Approximately 15 000 to 20 000 Canadians reside in Israel.

Canada has provided staunch support for Israel in multilateral fora. We are committed to Israel’s full participation and acceptance in international organizations.

Canada is an active and strong supporter of the Middle East Peace Process. We support the Interim Agreements reached by Israel and the PLO on Palestinian autonomy in the West Bank and Gaza Strip. We have called on the parties to honour the existing agreements and to pursue a negotiated solution to all outstanding issues. Canada’s goal is a just, lasting and comprehensive peace agreement, based on UN Security Council resolutions 242 and 338. Through our role as Gavel of the Refugee Working Group and through the multilateral track of the Middle East Peace Process, we have encouraged other countries to normalize relations with Israel.

On January 1, 1997, the Canada-Israel Free Trade Agreement (CIFTA) came into effect, removing tariffs from all but two industrial products of Canadian or Israeli origin. Only women’s swim wear and cotton fabrics will continue to be subject to tariffs until these products are phased out by 2000.

There have been a number of high level visits in recent years. The Minister of Trade and Industry, Natan Sharansky visited Toronto in July 1996 to sign the Canada-Israel Free Trade Agreement. In February 1997, the Minister for International Trade, Art Eggleton, made a return visit to Israel, leading a large business delegation. In the same month, the Minister of National Defence Doug Young, made a brief visit to Israel as part of a tour of peacekeeping operations in the region.

In September 1997, Israeli Foreign Minister David Levy made a brief visit to Ottawa, in conjunction with a private visit to Toronto. Mr. Levy had meetings with both Foreign Minister Axworthy and Prime Minister Chrétien. In November 1997, Mr. Axworthy visited Israel as part of his visit to the Middle East. In June 1998 both Minister for International Cooperation Diane Marleau and Minister for Intergovernmental Affairs Stéphane Dion visited Israel. Industry Minister John Manley discussed Israel’s research and development programmes and policies during his January 1999 visit.

In 1998 two-way trade exceeded $550 million. Our bilateral trade has grown steadily throughout the 1990s – up 37 per cent since 1994 alone. Canadian commodity exports exceeded $230 million in 1998, consisting of a wide assortment of manufactured goods. Major Canadian sales include machinery and parts, aluminum, paper and paperboard, electrical equipment and parts, wood pulp, cereals, sulphur and asbestos, optical measuring and checking equipment, wood and synthetic staple fibres. Services exports are estimated at $100 million.

Canadian imports from Israel were valued at more than $350 million in 1998, almost double 1994 figures. As in previous years, the largest categories of imports were diamonds, and mechanical and electrical machinery and equipment.

While Canada and Israel currently have strong commercial relations, the CIFTA agreement is generating more business opportunities for Canadian goods to compete in this growing and dynamic market. Two years after CIFTA’s implementation, bilateral trade has risen 19%, and Canadian firms are making a major impact in several sectors — most notably transportation and telecommunications.

The Export Development Corporation (EDC) offers four lines of credit (US$10 million each) for buyer credit financing in Israel. Canadian exporters looking to sell goods or services in Israel can benefit from the full range of financial and risk management services offered by the EDC.

The Canada-Israel Industrial Research and Development Foundation (CIIRDF) was established in 1993 to promote research and development co-operation between Canadian and Israeli firms. Jointly funded by the Governments of Israel and Canada, CIIRDF has approved $5.55 million for ten full-scale and six feasibility projects. CIIRDF will become self-financing in the year 2000.