(JNi.media) Israel and China on Thursday announced they are expanding by $500 million a protocol financing Israeli exports to China. The financial protocol is an agreement between the two governments setting up the infrastructure for exports from Israel to China.
According to the ongoing deal between the two countries, Israeli banks finance long-term credit for Chinese companies purchasing equipment in Israel. Insurance for each deal with China is provided by the Ministry of Finance’s Israel Foreign Trade Risks Insurance Corporation Ltd. (Ashra).
The new agreement raises the funds available for financing to $2.6 billion, as part of an Israeli government push for local companies to export to the Far East.
China is Israel’s second-largest trading partner.
Israeli Accountant-General Michal Abadi-Boiangiu said the added agreement “indicates the success of the protocol in opening the Chinese market to Israeli companies.”
This means Chinese buyers enjoy long-term, low finance loans, and the new deal will allow Israeli banks to offer them this long-term credit, helping Israeli exporters to compete successfully in the global market, with easy, government-subsidized insurance.
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“The policy of using state guarantees to support growth-generating targets is reflected in the expansion of the protocol, which will lead to the increase in the Israeli exports, thus benefiting employment, GDP, and tax revenues,” Abadi-Boiangiu said.
According to the Finance Ministry, since 2010, Israeli companies have executed 100 export transactions totaling $100 million, utilizing the protocol.
Transactions include the sale of medical equipment, and the construction and renovation of hospitals. Also exported: goods related to education, transportation, communication, infrastructure and agriculture.