The Philippines is exploring a free trade agreement (FTA) with Israel in a bid to expand both countries’ trade relationship, currently valued at over $400 million, according to the Department of Trade and Industry (DTI).

DTI Secretary Cristina Roque announced at the conclusion of the first Philippines-Israel joint committee meeting on Tuesday, July 29, that the government is targeting to complete the FTA with the Middle Eastern country before President Marcos’ term ends in 2028.

Roque said the DTI will soon start consultations with local stakeholders and industries to assess their aspirations regarding the potential benefits of the agreement.

She said negotiations for an FTA with Israel should not be too much of an issue given both countries’ strong trade relationship.

Trade in goods between the Philippines and Israel was valued at $400.42 million in 2022, with exports to Israel totaling $142.46 million and imports from Israel reaching $257.65 million, according to DTI data.

Israel was the 30th most valuable trading partner of the Philippines last year, out of 223 countries.

DTI Undersecretary Allan Gepty, the country’s top negotiator for FTAs, said a potential agreement with Israel is a welcome move for the country as it is aligned with the trade priority of the Marcos administration.

“As to what concessions will be extended, of course we don't want to preempt the negotiations, but there are key interests of both parties,” said Gepty.

“We'll work on that after we have, of course, finished the necessary domestic process,” he added.

Israel Minister of Economy and Industry Nir Barkat said the FTA with the Philippines, which could be their 17th, is part of Israel’s commitment to build a strong relationship with its trade allies.

Barkat said the agreement will “dramatically increase” exports between both countries as potential benefits will spur companies to strengthen their manufacturing.

“It's a classic win-win, in my mind, that the FTA could provide,” the official said.

“If you have to do business, you want to do it with people that you love. So I think that my expectation is you're going to see growth in the collaboration and doing business together,” he added.

Barkat noted that Israel joined the Asian Development Bank (ADB) as its 69th member last year, which strives to expand investments of Israeli companies in Asia.

With the ADB membership, he said Israel can leverage the FTA to further amplify investments of its companies into the Philippines.

He particularly cited the potential in increasing the presence of Israeli agri-technology firms in an effort to strengthen the country’s agriculture sector.

For instance, Barkat said one aquaculture company is interested in expanding in Asia, which presents a strong investment opportunity for the Philippines, given its vast waters.

“I can think of no better partner than the Philippines that is well-positioned to take advantage of something like this,” he added.

In terms of defense, he also hinted at potential collaborations, citing the Philippines’ role as a “friend,” similar to the United States.

With three years left in the Marcos administration, Roque said the government is being aggressive in its pursuit to secure FTAs to drive more investments in the country, which could boost economic growth.