Israel Japan | Business Guide | 2023

despite the three-year global pandemic, during which the possibility of in-person meetings were mostly unavailable. Japanese investments in Israeli Hi-tech have reached new levels each year, in both volume and number of transactions, hitting the landmark of nearly 3 billion USD in 2021 . With the lifting of travel restrictions towards the end of 2022 , business travel picked up substantially. Both governments have stepped up efforts to create favorable conditions for economic cooperation, sending a solidmessage to thebusiness sectors and encourage the bilateral collaborations further . Along with the official Prime Ministers’ visits in Japan ( 2014 ) and Israel ( 2015 and 2018 ), numerous visits of senior officials were organized in recent years. Official visits of Ministers of Economy and Industry, accompanied by business delegations, are considered importantmilestones inwhich agreements were signed and ties between the countries were strengthened. During 2022 , Israel’s Ministers of Tourismand Defense visited Japan and historic visits are planned for 2023 , emphasizing the aspiration of both sides to strengthen the bilateral relations. The bilateral investment treaty signed in 2017 , for the promotion and protection of bilateral investments, and the recent announcement in November 2022 regarding the initiation of a joint study, leading to a free trade area agreement (or Economic Partnership Agreement) also serve as good examples. Bilateral Trade Exports of goods from Israel to Japan is quite diverse and are comprised mainly of: Medical and optical devices, electrical devices and machinery, chemicals and chemical products, tools of base metals and processed food preparations. The leading industries in imports of goods from Japan are: vehicles and transportation products, electrical devices and machinery, chemicals and chemical products, and medical and optical devices. As can be seen in the chart below, exports of goods from Israel to Japan registered an upward trend since 2019 , reaching $ 1 . 128 billion USD in 2022 . This increase is especially noteworthy considering the state of the global economy of recent years; rising prices and interest rates; the extreme depreciation of the Japanese Yen; the supply chain crisis; and the war in Ukraine that led to a sharp increase in fuel prices and a record high trade deficit for Japan. Israeli exports to Japan represent about 1 %of its global exports, whereas imports from Japan represent about 2 % of global imports to Israel. Exports of services have been the growth engine for Israeli exports and for the Israeli economy as a whole. Since 2021 , Israel exports to theworldmore services than goods. This positive trend is also present in exports to Japan though still far from the existing potential. According to Israel Central Bureau of Statistics, exports of business services to Japan in 2020 was $ 252 million USD, compared with $ 202 million USD in 2019 . However, it should be noted that according to World Bank data, exports of services from Israel to Japan aremuch higher: between 2010 and 2019 a constant increase was registered, starting with $ 566 million USD in 2010 and reaching $ 1 . 24 billion USD in 2019 (Trade in services data is based on surveys conducted with ununiform methodologies. Moreover, only ‘business services’ export data is published by the CBS). 13