Israel–United Kingdom Free Trade Agreement
proposed free trade agreement between Israel and the United Kingdom
The Israel–United Kingdom free trade agreement is a proposed free trade agreement which began negotiations on 20 July 2022. The trade agreement would be the third FTA to cover Israel–UK trade, and superseding the Israel–UK Trade Continuity Agreement, extending the deal to cover services and digital trade. Trade value between Israel and the United Kingdom was worth £6,881 million in 2022.
On 20 May 2025, the United Kingdom suspended free trade negotiations due to the Israeli military expansion in Gaza; Foreign Secretary David Lammy announced the suspension in the House of Commons where he stated said events in Gaza were damaging Britain's relationship with Israel.
History
From 1 June 2000 until 30 December 2020, trade between Israel and the UK was governed by the Israel–European Union Association Agreement, while the United Kingdom was a member of the European Union. Following the withdrawal of the United Kingdom from the European Union, the UK and Israel signed a continuity trade agreement on 18 February 2019, based on the EU free trade agreement; the agreement entered into force on 1 January 2021.
Negotiations
Israel and the United Kingdom formally launched negotiations for the new free trade agreement on 20 July 2022.
The UK and Israel concluded the fourth round of negotiations on 29 February 2024.
The fifth round of negotiations highlighted that trade in services comprise around 80% of both the UK and Israel's economies, yet services only make up just over one third of total trade between the two countries; officials blamed this on the current Israel–UK Trade Continuity agreement which only covers trade in goods. The trading relationship between the UK and Israel was valued at £6.4 billion, as of September 2023.
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